Your guide to Muhurat Trading this Diwali

If one was raised in a Hindu traditional family, he must have seen the practice of marking a new beginning at certain auspicious hours of the day. The importance behind that comes from a belief that whatever is begun at such an auspicious time brings in success. Muhurat Trading is based on the same belief and has been taking place in Indian stock markets for more than 50 odd years.

The traders and investors at Dalal Street believe that this is an auspicious time for a beginner to start investing in the stock market. If you are someone who has been planning on starting to invest in the stock market, you might as well consider giving an auspicious start by buying some shares on the day of Diwali.

Let us guide you through the basics of Muhurat Trading and how, to begin with, trading and investing.

Muhurat Trading

Muhurat Trading is a short trading session of approximately one hour that takes place on an auspicious day of Diwali. This session goes live every year on the evening of Diwali giving a small window for traders and investors to place their bids. The Hindu communities, especially Gujaratis and Marwaris, strongly believe in buying some quantity of shares at this auspicious hour.

We call it ‘Shagun Ke Shares’. The word shagun means auspicious or good omen. The shares bought during this time are envisaged to bring in good fortune and wealth in the long run.

When is Muhurat Trading in 2021?

Muhurat Trading session takes place on the day of Diwali when Goddess Laxmi is worshipped. This year, Muhurat Trading shall take place on the 4th of November from 6:15 PM to 7:15 PM.

One can simply start investing as this muhurat is considered favourable for financing activities. You can open your account on or before 4th November and place your first order in this auspicious hour of Muhurat Trading.

How to begin investing with Muhurat Trading?

As we discussed the relevance of new beginnings on an auspicious day and time, many of the new investors and traders want to begin their journey with Muhurat Trading. Here’s a brief guide on various points to help you do a nayi shuruaat.

Open your Demat Account:

You must have a Demat account to enter the stock market. This is the first step to start investing. A Demat account is where your shares are stored in electronic mode allowing easy transactions of buying and selling.

Decide your capital and add funds:

After opening your Demat account, you need to add the decided amount of capital allotted for investment. We always recommend investing in a phased manner and never going all in.

Select the assets you want to invest in:

Multiple assets are available to invest in such as precious metals like gold and silver, stocks of companies, exchange traded funds, mutual funds, currency, etc. With your all-in-one demat account, you will have a plethora of investment options to choose from as per your needs.

Fixed criteria to pick stocks:

Suppose you are picking equity for investment. To invest in Shagun Ke Shares, we recommend you to start with stocks that are fundamentally strong and are large cap, and are more liquid. As a beginner, you can begin your investment by buying a small quantity of Shagun Ke Shares with a long term financial plan.

Points to remember while starting with Muhurat Trading

T+2 Settlement: Though the market opens for Muhurat Tradingfor one hour on a holiday, settlement procedure remains the same. It takes T+2 working days for settlement of delivery of shares to complete.

Don’t be over-optimistic: Many investors and traders are present on Muhurat Tradingday to buy but markets have seen a downfall on such days in the past. It is advised to take a cautious view after doing some research.

Brace up for volatility: Since the activity in the market increases on the day of Muhurat Trading, price movement could be more volatile. One must be prepared for increased price swings.

Conclusion

Buying Shagun Ke Shares will give an auspicious start to your financial planning, but certain emotions need to be kept at bay in order to become a successful investor or trader. One must always control two emotions while dealing with the stock market, greed and fear. All successful investors and traders have mastered these two emotions along with being patient. This Diwali, we wish you all tonnes of patience with strong emotions to help you gain more prosperity with Shagun Ke Shares.

Disclaimer: The article is for educational purposes only. Investment in securities is subject to market risk. Read all related documents carefully before investing.