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This year on Saturday, November 14, Diwali will be celebrated and both stock exchanges will hold Muhurat trading from 6:15 pm to 7:15 pm.
Muhurat trading is a popular trading session held on the occasion of Diwali every year by the stock exchanges.
This regular one-hour trading session is considered auspicious, usually in the evening, and marks the start of the new Samvat, which is the Hindu accounting year.
Many believe that trading in this one hour will bring good luck in investing in the new Samvat for them for the whole of next year.
Trading in Muhurat is more of a customary activity than a true investment case. It’s got a tinge of religion and shades of history.
Muhurat is an occasion for investing and trading communities to pay tribute to the goddess Lakshmi, the benevolent lord of riches and prosperity, and to celebrate the beginning of ‘Samvat’ or the New Year. Muhurat is considered an auspicious time according to the Hindu calendar. And during this hour, the planet set itself in such a way that work taken out during this time brings good results and prosperity.
At this juncture, when the market is full of positivity and looks poised for scaling new peaks, by making fresh bets on quality stocks, one can make the most of Muhurat trading.
As Muhurat trading marks a new beginning, experts point out that it’s the best time to analyze asset allocation and find out what works best and what is not.
Since trading is limited to an hour only one must not be carried away and make a prudent pass.
Experts indicate that during this special trading session, as the space for profit-booking is also small, one can avoid day trading strategy, while new investors can make token investments to mark the auspicious occasion, looking to get started.
“An investor needs to check due diligence before investing, whether you invest during Muhurat trading or regular days. Once the company has strong due diligence, an investor must go through the financials of the company and what are the factors that will drive growth and return ratio,” said Parmar.
“A organization with clear management and a healthy balance sheet that has long-term growth potential should be considered for investment,” he added.
With COVID-19 coming under control and the economy back on track, analysts think the new Samvat will augur well for the market.
The rate of change is picking up and I remain as bullish as ever on the market. In June, I was extremely bullish, and even today I am extremely bullish,’ Ace Investor Rakesh Jhunjhunwala said in a CNBC-TV18 interview.
Jyoti Roy, DVP- Angel Broking’s equity strategist believes that over the next year, a 10-12 percent growth in Nifty is likely on the markets, citing the growing possibility of a second US stimulus package coupled with low-interest rates globally and increasing the probability of vaccination starting at the beginning of 2021.
“We believe it should not be difficult for the Nifty, by next Diwali, to trade closer to levels of 13,500,” he said.