A fund dealing cut-off is the time on a dealing day by which a subscription or redemption order must reach the fund's transfer agent in order to be executed at the next calculated price. Orders received after the cut-off are held over to the following dealing day. Open-ended funds deal on a forward pricing basis, meaning the investor does not know the price when placing the order, and the cut-off, set in the prospectus, is fixed at or before the valuation point to preserve this.
The cut-off protects existing investors. An order accepted after the valuation point at a price already known would allow a trader to profit at the fund's expense, a practice known as late trading, which is prohibited. The cut-off also starts the timetable for subscription processing, redemption processing and the net asset value calculation carried out in fund accounting.