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The rules for buying mutual funds have changed. Which NAV will be applicable?

On Thursday, Sebi issued a circular on mutual funds to change the rules for net asset value. From January 1, investors will get the purchase NAV on the day the investor’s money reaches AMC. “It has been decided that with regard to the purchase of units in mutual funds (except liquid and overnight funds), Closing net asset value of the day will be applicable on the day the funds are available for use, regardless of the size and time of receipt of such a request, ”said the Sebi circular.

The new net asset value rules will not apply to liquid and overnight funds.

Here is the net asset value you will get on your funds:

Equity funds

  • Investments up to ??2 lakh: Currently, an investment of up to ??2 lakh obtains the net asset value of the same day if the request is submitted before 1 p.m., regardless of the realization of funds. However, if the investment request is made after the cut-off time, the investor will get the net asset value for the next day.
  • Investments on ??2 lakh: Investors get the net asset value for the day when the funds reach the AMC. Suppose you submit an investment request ??3 lakh in an equity fund before 1 p.m. on Monday. If the investment amount reaches the mutual fund house the next day, you will get Tuesday’s NAV as the purchase NAV, not Monday’s.
  • New rule: From January 1, all investments will recover the net asset value of the day the funds reach the AMC, regardless of the size of the investment.

Debt Fund

  • Investment up to ??2 lakh of debt funds other than liquid and overnight plans: Currently, if a request is filed before 1:00 p.m., the investor will get the same day NAV, regardless of the realization of the funds.
  • Investment on ??2 lakh of debt funds other than liquid and overnight plans: Any further request ??2 lakh submitted before the 1pm cut-off time, will get the net asset value on the day the funds reach the AMC.
  • New rule for debt funds other than liquid and overnight plans: Investors will get the NAV, subject to the realization of funds. Thus, an investor will get the NAV on the day the funds reach the mutual fund house, regardless of the size of the investment.
  • Liquid funds and overnight funds: Right now the cut-off time for these categories of debt programs is 12:30 p.m. and the investor will get the NAV on the day the funds are realized or, we can say when the funds get to the AMC.
  • New rule: There is no change in the rules for liquid and overnight funds. The same rules apply to liquid funds and overnight.

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