By Karin Strohecker

LONDON (Reuters) - Rattled by the political and economic risks over Britain's Brexit vote, European funds have cut equity exposure to the lowest level in at least five years and boosted cash holdings to the highest since last summer's market rout.

The poll of 15 European asset managers was conducted between June 15-29, straddling Britain's shock vote to leave the European Union. European stocks <.FTEU3> suffered their biggest daily drop since the 2008 financial crisis after the Brexit result.

At least two-thirds of the poll respondents submitted their data after the vote.

Funds' equity holdings fell to 40 percent of global balanced portfolios, while cash holdings rose to just above 10 percent - their first time back in double-digits since August-October last year, when investors sought refuge as China's surprise devaluation of the yuan sparked a global sell-off.

Bond holdings remained almost unchanged at just above 41 percent, while the allocation to alternative assets - hedge funds, private equity and infrastructure - rose to nearly 8 percent as fund managers sought out assets less correlated to world markets, and ways to protect returns.

"We expect a risk-off attitude in financial markets to continue as investors digest the potential impact of the Brexit and as the geopolitical risks remain high given the unclear path of what will be a long Brexit process," said Matteo Germano, Global Head of Multi Asset Investments at Pioneer Investments.

The Brexit volatility and recession fears has driven a further slump in bond yields, with over $11 trillion of government debt now yielding less than zero.

Across global fixed income portfolios, the survey found that funds slashed their exposure to UK bonds to 2.1 percent from 2.7 percent - the lowest in at least five years - while also reducing holdings in emerging European debt, reflecting the region's vulnerability to Brexit.

Holdings in U.S. bonds fell by nearly 4 percentage points to 28.1 percent while those in Japan lost 0.5 percentage points to 0.3 percent.

Meanwhile, holdings in euro zone debt gained 0.7 percentage points to 51.5 percent.

Fund managers also expressed their concerns over more political uncertainty ahead, with the possibility of a win for Donald Trump in U.S. presidential elections seen by nearly all respondents as negative for markets.

"It would once again increase the geopolitical risk at a worldwide level," said Nadege Dufosse, Head of Asset Allocation, Candriam.

"Concerning the impact on US business and economy it is more difficult to assess now but in our first estimates it is more a risk than an opportunity," she added.

Within global equity portfolios, managers raised their exposure slightly to the U.S. and Asia ex-Japan, but trimmed holdings in British, Japanese and Western as well as emerging European stocks.

(Additional reporting by Massimo Gaia in Milan; Editing by Hugh Lawson)