‘Muhurat Trading’ will be conducted on November 1, the authorities of both BSE and NSE have communicated in circulars. It will mark the start of new Samvat 2081, the Hindu calendar that starts on the auspicious day. Though the bourses will be closed for normal business due to Diwali, it will open for this special session only.
An old adage says, “Investment is an act of faith.” The trijunction of investment, faith and auspicious moment takes place every year in India on Diwali, arguably the most widely celebrated event across this vast country. Every year, Muhurat trading is keenly watched by all categories of investors, who take it as an indicator of the mood of the investors and traders at the beginning of the year ahead.
What is Muhurat Trading?
The market opens for just 1 hour on the evening of Diwali every year to conduct a trading session. The word ‘muhurat’ refers to an auspicious time. During the trading both investors and traders pray for good fortunes during the year ahead.
Every year the stock exchanges convey the time for ‘muhurat’ trading before the auspicious day of Diwali. The trading takes place on both platforms Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
Muhurat Trading Date and Auspicious Time
This year Muhurat trading is supposed to take place on Friday, November 1. The stock exchanges officially announce that the symbolic trading session will be held between 6 pm and 7 pm. The pre-opening session will take place from 5:45 pm to 6:00 pm.
Importance of Muhurat Trading
The significance of Muhurat trading is more than one. To begin with, it marks a ceremonial flagging off to the financial year in a ‘feel good’ atmosphere. Since trading is frequently linked to sentiment, it often leads to a favourable market environment. Experts also point out that Muhurat trading offers an opportunity to realign portfolios. Last but not the least, new investors also use the auspicious moment to launch their journey in equity investments.
What Happens in Muhurat Trading?
All normal trading activities both in the cash and derivatives segment take place just like normal trading sessions. Only the time is truncated. It has become a tradition and marries finance and faith. Last year, Muhurat trading took place on November 12. Trading began at 6:15 PM and ended at 7:15 PM.
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