It’s the time of the year again when Muhurat Trading is on your mind! Many families and individuals in India prefer to begin something at the right Muhurat. Muhurat means an auspicious time to initiate an activity. Whether it is buying a new house, a new car, or a new business – everything must align with the position of the stars at the right time.
As per the Hindu calendar, Diwali is regarded as the new year. So, people begin by investing in the appropriate stocks to safeguard their future. It is believed that investing on the auspicious day of Diwali will bring good fortune, success, and prosperity to your portfolio.
What is Muhurat Trading?
Muhurat Trading is an hour-long trading session scheduled on the special day of Diwali. It is a traditional ritual that symbolizes investing for your future during the most auspicious one hour.
When is Muhurat Trading: Time and Date
For Vikram Samvat 2023, Muhurat Trading is on Sunday, 12th November, for an hour, between 5.45 pm and 7:45 pm.
| Diwali Muhurat Trading Session on Sunday, November 12, 2023 | |
| Segment | Pre-open session |
| Block Deal Session | 6:00 - 6:08 pm |
| Pre Open* | 6:00 - 6:08 pm |
| Normal Market | 6:15 - 7:15 pm |
| Call Auction Illiquid Session* | 6:20 - 7:05 pm |
| Closing Session | 7:25 - 7:35 pm |
| Trading Modification Cut-off Time | 6:15 - 7:45 pm |
Diwali is a festival of light and warmth, which brings prosperity, wealth, and happiness. Hence, an hour-long trading window is opened for investors to participate in the stock market during these hours after a 15-minute pre-market session.
The usual schedule for any trading day starts at 9 am with a pre-market for 7 minutes, which includes block deals, overnight trade settlements, and global market movements priced into the stock prices. This is followed by a regular trading session from 9:15 am to 3:30 pm.
Muhurat Trading also follows a very similar structure. It starts with a block deal session followed by a pre-open market session for about 15 minutes for the prices to settle. This is followed by a regular trading session where all buyers and sellers can participate like any other trading day. But Muhurat Trading lasts only for an hour.
History of Muhurat Trading
The oldest exchange in India, the Bombay Stock Exchange (BSE), started the ritual of Muhurat Trading on the auspicious day of Diwali in 1957. In 1992, the National Stock Exchange (NSE) adopted the practice of Muhurat Trading, and since then, it has been a norm for both stock exchanges.
Significance of Muhurat Trading and How to Pick Stocks
Diwali is considered an auspicious time when people believe that planets, stars, and timings align to bring good luck, prosperity, and abundant wealth. So, Diwali can be an excellent opportunity to begin your investment journey. Investing in good stocks with sound fundamentals and promising future earnings is essential to build a strong portfolio. Therefore, during the muhurat trading session, focus on purchasing stocks with exceptional long-term prospects.
The markets tend to be volatile since the Muhurat Trading window is open only for an hour. Therefore, we compiled the data on market movement on Muhurat Trading Day over the last decade.
| 10 Year Mahurat Trading Nifty Performance | ||
| Year | Date | Nifty Day Movement |
| 2022 | 24-10-2022 | -0.03% |
| 2021 | 04-11-2021 | 0.49% |
| 2020 | 14-11-2021 | 0.47% |
| 2019 | 27-10-2019 | 0.37% |
| 2018 | 07-11-2018 | 0.65% |
| 2017 | 19-10-2017 | -0.63% |
| 2016 | 30-10-2016 | -0.14% |
| 2015 | 11-11-2015 | 0.54% |
| 2014 | 23-10-2014 | 0.23% |
| 2013 | 03-11-2013 | 0.28% |
| 2012 | 13-11-2012 | -0.40% |
As you can see, the stock market has delivered positive returns on 7 Muhurat Trading sessions over the last ten years. Between 2012 and 2022, NIFTY has grown more than 3 times, while several individual stocks have grown multifold.
So, if you believe in starting on an auspicious day, then the Muhurat Trading Day is a good day to begin your wealth-creation journey.
Let’s put this into perspective. Nifty has grown at a compound annual growth rate (CAGR) of 11.76% between 2013 and 2023. So, if you had invested Rs. 10 lakhs on the Muhurat Trading Day in 2013, your investments would have been worth Rs. 30.44 lakhs in 2023.
Here are a few things to keep in mind before participating in Muhurat Trading
- The Muhurat Trading session will occur on 12th November, and the trading window will open between 5:45 pm and 7:45 pm, as per the NSE’s latest circular.
- Muhurat Trading is similar to a typical trading day, where all open positions at the end of the session become a settlement commitment. It’s essential to be mindful of your trades.
- Many brokers, traders, and investors believe this time of year is ideal for investing in the stock market. As a result, more people participate in Muhurat trading than usual.
- Investing in stocks based on business fundamentals is a timeless approach. As a long-term investor, seeking out companies with a solid industry reputation, consistent growth in revenue and profits, positive cash flow, and other favorable indicators is essential. Doing so lets you decide which stocks to buy on Muhurat Trading Day.
- The primary investing principles still apply, but assessing your risk tolerance and financial and personal objectives is essential.
- Investors should be cautious during this excitement as rumors and tips spread quickly.
The takeaway for Muhurat Trading 2023
Muhurat Trading Day is a sign for those waiting on the sidelines and looking for the right time to invest in the stock markets on the day. Though it is called Muhurat Trading, an investor can consider it a Muhurat Investing Day to begin investing in the stock market for wealth creation.
*Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as recommendation or investment advice by Research & Ranking. We will not be liable for any losses that may occur. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.
Read more: About Research and Ranking
I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.