What is Diwali Muhurat Trading?

Muhurat Trading is the well-known old ritual that is being followed by the trading community from ages. This is the auspicious one-hour trading that is held on the day of Diwali and the time for the same is specified by the stock exchange every year. It is an old belief that by doing trade during Muhurat trading, a trader or investor will earn wealth and prosperity the whole year. This session is mostly held during the evening and most of the traders buy stocks during this time.

The word "Muhurat" means an auspicious time and as per the Hindu calendar, during this time, the planets align themselves in a pattern and doing a trade during this time brings in prosperity. Most of the traders trade during this time for religious, sentimental and traditional reasons.

How did it all begin?
Diwali Muhurat Trading is unique to the Indian stock markets only and brokers used to open the new settlement accounts for all their clients on the day of Diwali during the Muhurat trading session. The same tradition is followed in the capital market where on the day of Diwali, Laxmi pujan is done and investors purchase shares of the good companies so that they can hold them for long-term gains. Muhurat trading gives us two clear messages; to focus on quality and to invest with long-term goals.

Things that you should know about Muhurat Trading

1. Auspicious day to invest
The day of Diwali and especially the time of Muhurat trading is considered to be quite auspicious to invest one 's money. This is one of the reasons that many traders start the occasion with special prayers; moreover, they buy shares for the companies they wish to hold for long-term. One also needs to predict the stock market trading activity the day before to make a wise investment.

2. Good for new investors
Muhurat trade is also known as the most auspicious time for a new trader to do his/her first trade. One gets to understand the market and can experiment with a small investment. Once a thorough understanding is gained, traders can invest by picking up the best stocks.

3. Brings in profits for intraday traders
There are many traders who believe that Muhurat trading brings them a lot of profit as Sensex would have a bullish trend. Hence, many buy the stocks and sell them on the same day. However, one has to be cautious while doing so as there are Muhurat trading sessions where the Sensex has seen a loss. Also, there are times when the Sensex has dipped on the day after the festival.

What the investors need to do?
Any investor needs to lookout for good company stocks that are showing high returns or good cash flows to invest. Adding gold to your investment portfolio must be done wisely in order to generate good returns. At Motilal Oswal, we've recently launched Me-Gold on the MO Investor platforms, through whichthe investors can buy, store and sell 24K 999.9 pure Gold online.
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If you are one of those many traders who haven 't yet found the right time to start your first trade, Muhurat trading 2021 is the right time to venture into the stock market trading. This is the very exciting time for both investors and traders and it is important not to get carried away with the fervor to earn more and remember to trade smart. Muhurat trading this Diwali will be held on the 04 number 2021, On Thursday. The timings will be 6.15 PM to 7.15 PM.
So, it is time to get ready by doing your research on what stocks to trade and invest during the Muhurat Trading this Diwali.