Sprott Asset Management Inc. has been given permission to expand the gold holdings in its Sprott Canadian Equity Fund. Sprott said today it has received an exemption allowing the fund to invest up to 20% of its net assets in gold and permitted gold certificates.

Sprott said in a statement it intends to invest in gold and gold certificates as a defensive strategy in adverse market, economic, political or other circumstances. “Sprott considers gold and gold certificates to be a viable alternative to holding cash or cash equivalents in such markets. Investment in gold and gold certificates will permit Sprott additional flexibility to seek to increase gains for the fund in certain market conditions, which may have otherwise caused the fund to have significant cash positions.”

Toronto-based Sprott has assets under management of more than $1.1 billion as of Sept. 30.