Cut-off times and which day’s NAV you get

The cut-off time is a daily deadline set by regulation that decides which day’s NAV your purchase or redemption is priced at. For most mutual fund schemes it is 3:00 p.m. on a business day. Submit a valid request before the cut-off — and, for a purchase, make sure the money has reached the fund by then — and you are allotted that day’s NAV. Miss it and you are allotted the next business day’s.

What a cut-off time is

A cut-off time is the point in the day by which your instruction must reach the fund for it to count as that day’s business. A fund’s NAV is struck only once a day, after the market closes, so the fund needs a clean line between “received today” and “received tomorrow”. The cut-off is that line. It is the same idea as a bank’s deadline for same-day processing, applied to which day’s price you get.

Which day’s NAV you are allotted

For a purchase in most schemes, a valid request received before the 3:00 p.m. cut-off, with the money already credited to the fund, is allotted the same day’s NAV. A request that arrives after the cut-off, or whose money arrives later, is allotted the NAV of the business day on which both conditions are finally met. Redemptions follow the time rule too: a redemption request before the cut-off is processed at that day’s NAV, and one after it at the next business day’s.

The second rule people miss: the money must actually arrive

For a purchase, hitting the cut-off with your request is only half of it. The money has to be realised — actually credited to the scheme’s bank account — before the cut-off as well. This rule applies to all purchases regardless of the amount. So a large lump sum you initiate at 2:55 p.m. may still get a later day’s NAV if the transfer only settles the next morning. For a regular SIP this rarely bites, because the auto-debit mandate is timed to clear on your chosen date; it matters most for a one-off large transfer.

Cut-off times by scheme type

The deadline is not the same for every kind of scheme. Liquid and overnight funds — the ones people use to park cash for days — have an earlier purchase cut-off and their own pricing quirk, because they can allot the previous day’s NAV when the money is in early.

Scheme type	Purchase cut-off	Redemption cut-off
Equity and most debt schemes	3:00 p.m.	3:00 p.m.
Liquid and overnight funds	1:30 p.m.	3:00 p.m.

These are the deadlines fixed by regulation and applied across fund houses; a scheme’s own scheme document states them for that scheme. The times are read in the fund’s local business hours, on a day the market and banks are open — a request on a weekend or a holiday is treated as arriving on the next business day.

When the cut-off actually matters

For most long-term investing, the cut-off barely matters: one day’s NAV is not meaningfully different from the next, and an SIP running for years will not notice a single day’s shift. Chasing a particular day’s NAV is not a strategy — you cannot see the NAV before it is struck, so there is no dip to time. The cut-off is an operational fact to work with, not an edge to hunt.

Where it does matter is admin certainty on a large or time-sensitive transaction: a big redemption you need settled by a known date, or a lump sum you want on record before a financial year ends. In those cases, allowing a clear business day for the money to move, rather than acting minutes before a cut-off, is the whole trick.

What to do about it in practice

The practical rule is short. For a one-off purchase, transfer the money a day ahead so it is realised well before the cut-off, rather than initiating everything at once close to 3:00 p.m. For a redemption you need by a certain date, count business days back from that date and place the request with a day or two to spare. For your monthly SIP, you need do nothing — the mandate handles the timing.

If you would like a hand making sure a large or time-sensitive transaction lands on the day you intend, that is the sort of admin we help with — at no charge, and without being told what to buy.