Magellan Fund Keeps More Cash on Hand

Fidelity Investments’ flagship Magellan Fund raised the portion of its assets held in cash to the highest since Robert Stansky took over more than three years ago, new data show.

Stansky increased the fund’s cash to 7.8% of its assets at the end of July from June’s 6.9%. That represents about $1 billion more cash on hand for the world’s biggest mutual fund, which has assets of about $93.6 billion. It’s more than double the 3.3% of assets held in cash at the start of the year.

“It may be an indication [he got] a little more cautious on the market,” said Nikolas Lanyi, editor of the Fidelity Insight newsletter.

The S&P; 500 fell 3.2% in July, the second-biggest monthly decline this year, after gaining 5.4% in June. Many stocks fell much more sharply.

Stansky, who took the helm of Magellan in June 1996, may also be preparing for rising investor withdrawals related to year 2000 computer concerns, analysts speculated.

The fund’s cash position could also have shifted--in either direction--in the six weeks since the end of July.