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For a purchase in a liquid fund, the applicable NAV is generally that of the day on which:

AThe application is submitted, regardless of when funds are received
BThe units are allotted, which is always T+3
CThe investor completes KYC
DThe funds are available for utilisation by the scheme before the cut-off timecheck_circle

Correct answer

D. The funds are available for utilisation by the scheme before the cut-off time

lightbulbDetailed Solution

For liquid and overnight funds, NAV applicability depends on the funds being realised and available for utilisation by the AMC before the applicable cut-off time — not merely on the time of application submission. This 'realisation of funds' rule prevents investors from getting a prior day's NAV without money actually reaching the scheme.

Reference: NISM Series V-A Mutual Fund Distributors, Chapter 5.

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