This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Cash as a Percentage of Mutual Fund Portfolios

Cash as a Percentage of Mutual Fund Portfolios (Since 2000)
Source: Investment Company Institute
Related Metrics
  • Assets in Money Market Funds
  • Mutual Fund Inflows/Outflows

    ** Back to Metrics **

    For the second month in a row, cash sitting in mutual fund portfolios fell, according to figures released Tuesday afternoon from the Investment Company Institute. Cash as a percentage of mutual fund holdings fell to 5.6% in January, down from the December figure of 5.8%. Just three months ago, cash as a percentage of mutual fund portfolios reached a three-year high of 6.5%.

    With a strong stock market in January, it's no surprise that cash levels came down a bit during the month. There's little doubt that some of the cash deployed by mutual funds helped boost stock prices during January. February's difficult stock-market environment, however, may temper fund managers' enthusiam for deploying large amounts of cash into equities. Indeed, fund managers might be content to let their cash earn 5% in money market accounts instead.

    Why This Metric Matters
    This figure shows the percentage of assets under management that equity mutual fund managers have in cash or cash equivalents like money market funds. When this number rises, it indicates that money managers are growing cautious. That's typically bad news short term -- as money managers are reluctant to spend that cash on equities.

    But it's often seen as a positive for the market looking out a little further, as managers can be expected eventually to use that cash to load up on stocks. So, short term, rising cash levels can be seen as a negative. Longer term, it's a potential positive.

    Consider this: In October 1990, cash levels reached nearly 13%. The market rallied sharply right after that: The S&P 500 bottomed that month but was trading almost 30% higher within a year. In March 2000, cash levels reached their lowest levels of the decade, just as the Nasdaq and S&P 500 reached their all-time highs. Since then, the indices have fallen and cash levels in mutual funds have begun to rise.

    How Often Updated on TSC
    Monthly, near the end of the month for the prior month
    Historical Info
    The Investment Company Institute has been tracking this particular metric since 1970. During the '90s bull market, this metric recorded a high of 12.9% in October 1990. Its lowest point from the 1990s forward came in March 2000, when it sank to 4.1%. (See this related story for more historical info.)
    Top of page | Back to Metrics

    Select the service that is right for you!

    Action Alerts PLUS
    Try it NOW

    Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

    Product Features:
    • $2.5+ million portfolio
    • Large-cap and dividend focus
    • Intraday trade alerts from Cramer
    • Weekly roundups
    TheStreet Quant Ratings
    Try it NOW
    Only $49.95/yr

    Access the tool that DOMINATES the Russell 2000 and the S&P 500.

    Product Features:
    • Buy, hold, or sell recommendations for over 4,300 stocks
    • Unlimited research reports on your favorite stocks
    • A custom stock screener
    • Upgrade/downgrade alerts
    Stocks Under $10
    Try it NOW

    David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

    Product Features:
    • Model portfolio
    • Stocks trading below $10
    • Intraday trade alerts
    • Weekly roundups
    Dividend Stock Advisor
    Try it NOW

    Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

    Product Features:
    • Diversified model portfolio of dividend stocks
    • Alerts when market news affect the portfolio
    • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
    Real Money Pro
    Try it NOW

    All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

    Product Features:
    • Real Money + Doug Kass Plus 15 more Wall Street Pros
    • Intraday commentary & news
    • Ultra-actionable trading ideas
    Options Profits
    Try it NOW

    Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

    Product Features:
    • 100+ monthly options trading ideas
    • Actionable options commentary & news
    • Real-time trading community
    • Options TV
    To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
    Submit an article to us!


    DOW 17,804.80 +26.65 0.15%
    S&P 500 2,070.65 +9.42 0.46%
    NASDAQ 4,765.38 +16.9840 0.36%

    Brokerage Partners

    Rates from

    • Mortgage
    • Credit Cards
    • Auto

    Free Newsletters from TheStreet

    My Subscriptions:

    After the Bell

    Before the Bell

    Booyah! Newsletter

    Midday Bell

    TheStreet Top 10 Stories

    Winners & Losers

    Register for Newsletters
    Top Rated Stocks Top Rated Funds Top Rated ETFs