What is Muhurat trading and why it is significant in Indian stock market?

November 11, 2023

Muhurat trading is a special one-hour trading session held on the day of Diwali, the Hindu festival of lights, in the Indian stock market. The word “muhurat” means an auspicious time, and it is believed that investing in stocks during this time will bring good luck and prosperity.

The tradition of muhurat trading dates back to the 18th century, when stockbrokers would open their new year accounts on Diwali. This tradition has continued to this day, and many people still believe that it is a lucky time to invest.

Muhurat trading is typically held in the evening, after the Lakshmi Puja, a ritual to worship Lakshmi, the goddess of wealth and prosperity. The exact timing of the trading session varies from year to year, but it is usually between 6:00 PM and 8:00 PM IST.

During the muhurat trading session, investors typically buy stocks of companies that they believe are auspicious or have strong fundamentals. Some popular stocks to buy during muhurat trading include gold stocks, consumer goods stocks, and information technology stocks.

While there is no guarantee that investing in stocks during muhurat trading will lead to profits, the tradition remains popular among many Indian investors. It is a way to celebrate Diwali and express their hope for a prosperous year ahead.

Here are some of the reasons why muhurat trading is significant in the Indian stock market:

• It is a reflection of the Hindu belief in the importance of auspicious timing. Hindus believe that certain times are more favorable for certain activities, and that investing in stocks during Muhurat trading will bring good luck.
• It is a way to celebrate Diwali. Diwali is a major Hindu festival, and Muhurat trading is a way for people to participate in the festivities and express their hope for a prosperous year ahead.
• It can generate excitement and positive sentiment in the market. Muhurat trading can sometimes lead to increased trading activity and positive sentiment in the market. This can be beneficial for investors, as it can lead to higher stock prices.

It is important to note that Muhurat trading is not a guarantee of profits. Investors should always do their own research before making any investment decisions.