Stock traders and investors are gearing up for their annual muhurat trading session as the festival of lights approaches. Diwali muhurat trading is a yearly tradition that is carried out on the stock exchanges of India.
Mahurat trading is an activity in the Indian stock market which is done on the auspicious occasion of Diwali. ‘Muhurat’ is a Hindi word meaning ‘auspicious time’. In the Hindu calendar, a muhurat is said to occur when the planets are aligned to bring good fortune and prosperity.
Each year, the stock exchanges announce a one-hour session dedicated to Diwali muhurat trading. The muhurat trading time is usually in the evening. Hindu traders and investors buy or sell stocks on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) during muhurat trading time as a symbolic gesture. By doing so, they hope that wealth and prosperity will follow them the rest of the year.
The NSE and BSE Muhurat Trading session in 2023 will be conducted on Sunday, 12th November, 2023.
6:00 PM – 6:08 PM IST
6:15 PM – 7:15 PM IST
7:30 PM – 7:38 PM IST
7:40 PM IST
|Pre-Open Session||6:00 PM – 6:08 PM IST|
|Muhurat Trading||6:15 PM – 7:15 PM IST|
|Post-Close Session||7:30 PM – 7:38 PM IST|
|Market Close||7:40 PM IST|
Planning to engage in a spot of Diwali trading this year but don’t know the ropes? Here are some muhurat trading facts to get you started:
Muhurat trading time: The BSE and NSE muhurat trading time is specified by the stock exchanges each year. The special Diwali trading sessions last around one hour. The markets are generally closed for Diwali the next day. Many traders begin the session with a special Laxmi puja.
New year begins: For the Gujarati and Marwari communities, the session marks ‘Samvat’ or the new year. Many people from the two communities engage in stock trading and broking. For many in the business community, this is when old ledgers are closed and new ones are opened to mark the beginning of a new year.
When it started: Special Diwali trading has been conducted on the BSE since 1957. Muhurat trading started on the NSE from the year of its formation in 1992.
Trading in the stock markets carries some risk. So, don’t just jump in blindly and trust that the planetary alignment will work in your favour. All smart traders follow certain key steps regardless of whether they are trading on Diwali or on a regular trading day.
1. Shortlist promising stocks: Know what you are going to trade well in advance. The muhurat trading session is very short—you have only around one hour. So, it would be a good idea to pre-select stocks of companies that show high returns and healthy cash flows. Fundamental analysis on different companies will help in this regard. Keep in mind that many traders choose the occasion to buy shares that they will hold on to for the long term.
2. Do your research: Once your stock shortlist is ready, check the technical indicators as well. For instance, the historical price patterns of a particular stock could help you assess future trends. Based on your assessments, you could identify the best time to buy or sell a particular stock depending on the prevailing market trends.
Hindus participate in the Diwali trading session because they deem it auspicious. But you do not have to be Hindu to take part in muhurat trading. You would simply need to have a demat account and a trading account to buy and sell securities on the stock market. If required, you could open an account with a full-services broker like Kotak Securities and start trading.
Muhurat trading on the occasion of Diwali presents an excellent time to buy and sell securities. But it is not enough to simply make a token purchase or sale of a stock. Instead, use the occasion to set up your future trading strategy. Here are some ways in which you can benefit from the muhurat trading session:
1. Take your first steps in the stock market: If you are new to stock market trading, use the occasion of muhurat trading to kickstart your trading career. A good approach is to start small. Invest small amounts in one or two stocks. Use the weeks or months that follow to monitor their price movements. Once you have some trading experience, you could gradually scale up your portfolio to include more securities.
2. Profit from the bullish trends: Muhurat trading tends to bring bullish sentiments to the market. If you happen to be an intraday trader, this would spell good news. You could book profits from the price appreciation if you buy and sell a set of stocks before trading ends for the day. However, be cautious, for sometimes the markets may take a bearish turn. Study the markets closely before making a move.
Muhurat trading could be the perfect time to rethink your current trading strategy or implement a new one. Just do your research to get a thorough idea of the current trends, and make sure to keep an eye on changing stock prices. Once you’ve done your homework, you will be primed to make good trades when the muhurat trading session begins.
The trading day for Diwali Muhurat is November 12, 2023.
The trading session for Muhurat will last for just one hour.
Yes, intraday trading is allowed during Muhurat Trading.
Yes, it is possible to participate in F&O (Futures and Options) trading during Muhurat Trading.
Yes, Muhurat Trading is a special trading session and differs from regular trading hours. It is a short one-hour session conducted on Diwali.
Yes, investors can buy or sell mutual fund units during Muhurat Trading, similar to individual stocks.
No, Muhurat Trading is not mandatory for investors. It is optional, and investors can choose to participate if they wish.
No, there are no specific tax benefits associated with trades made during Muhurat Trading. Taxation follows the regular rules applicable to trading income.
Muhurat Trading is not inherently bullish, market conditions and investor sentiment during the session determine whether it is bullish or bearish.
Generally, there are no specific market restrictions during Muhurat Trading, and trading takes place as per regular market rules.
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