Muhurat Trading 2023: All You Need to Know

Muhurat Trading is a unique trading session that takes place during the festival of lights, Diwali. It is considered a lucky moment to trade in the Indian stock market. Read the article to know the exact time and date of Muhurat Trading 2023 specified by the stock exchanges.

What is Muhurat Trading?

Muhurat trading is the one hour trading that is done on the day of Diwali. Indian stock markets open for only one hour on Diwali day. This one hour is known as Muhurat trading hour. This Muhurat trading is done as part of a long established tradition of Indian equity markets.

Muhurat Trading 2023 Time and Date

This year Diwali is falling on Sunday, 12th November 2023. So Muhurat trading will take place on this day. It will take place between 6 p.m. and 7:15 p.m. in the evening. The 15 minute pre-market session will be from 6 p.m. to 6:15 p.m.

Many investors consider trading in the Muhurat hour on Diwali as favorable and auspicious. Trading takes place in the usual way during Muhurat trading as on any other day. Trading takes place in equities, currency & commodity derivatives, equity derivatives such as futures & options etc. Block deals take place on this day and so do normal trades. Pre-market bids and closing bids can also be made.

What is a Muhurat Trading Session?

Muhurat trading refers to trading that occurs during certain auspicious times as fixed by a calendar. This form of trading has been prevalent in Indian stock markets for many years and recently gained prominence as an alternate way to trade stocks.

The main purpose of these ‘trading hours’ is to allow investors who may not be able to actively participate in trading all year round to participate during special festivals like Diwali, Dussehra, etc., depending on one’s religion (Hindu, Muslim, Christian or other).

The other objective of these trading sessions is to allow retail investors access to institutional brokers through High-Frequency Trading (HFT) platforms without having access all year round. Recently, the NSE (National Stock Exchange of India Limited) has also provided facilities for online Muhurat Trading available every day.

During regular market hours, these activities are deemed illegal since it interferes with any activity occurring at that time. For example, if Nifty futures contracts worth ₹5 million were traded during regular market hours, then another ₹10 million will have to be sold/bought at regular market prices thereby affecting its future price due to excess demand/supply.

Who Can Benefit from Muhurat Trading?

There is a long-standing tradition of Diwali Muhurat Trading Sessions in India. According to Hindu tradition, there are specific times when actions must be undertaken. Hindus have been following astrological recommendations for thousands of years now, and they believe that certain activities must be carried out at precise moments in time. In India, financial markets have been closed on occasions when major events took place.

Investors can benefit from Diwali Muhurat Trading Sessions, particularly those who want to buy or sell a large number of shares. Because many retail investors have limited knowledge about market trading, they often struggle to figure out which day is considered auspicious for trading. For instance, you might know that Friday and Saturday are considered bad days for buying stocks. However, since each stock has its Muhurat date, you will have to do more research on that before doing any transaction.

Higher probability of markets ending in green at the close of Muhurat trading

The probability of Indian stocks markets ending in green is higher at the end of Muhurat trading. According to available data, out of the past 10 years, in 7 years markets ended in green at the end of Muhurat trading. But again, there is no guarantee that the markets will end in green at the end of Muhurat trading hour.

Liquidity is low on Muhurat trading day

Liquidity or trading volume on Muhurat trading day is very small when compared to other days. This is because the market is open for only one hour on this day. And many people are busy with Diwali festivities. So a lot of investors that do trading or investments on this day, do so in small amounts.

Like any other day, you should make trading & investment decisions on the Muhurat trading day after considering all the relevant factors. Do not make investment & trading decisions in a hurry. Do not get buoyed by the sentiments of festivities. Otherwise, the chances are higher that you may incur losses on the trades and investments that you make on this auspicious day.

Things to keep in Mind Before Indulging in Muhurat Trading

Get your trading account registered: If you don’t have an NSE/BSE account for Diwali Muhurat Trading yet, make sure you get it registered well in advance so that market data is available when trading begins and doesn’t disrupt your performance.

Double-check your accounts: Make sure all KYC (know-your-customer) documents like identity proof and address proof are well within sight when trading begins. Incomplete or incorrect information can lead to steep fines from exchanges if found out later on.

Check volume levels: Volume levels indicate interest levels of investors towards specific assets which directly affects prices during muhurat trade timing.

When should you start trading?

Although different brokers might give you different indications regarding opening times for trading, generally brokers suggest trading around 20 minutes before the opening bell. However, if stocks remain locked beyond 17 minutes after opening bell, exit immediately as sudden price movements often occur at such times due to automatic trades executed by brokerages once markets open.

Should I buy shares at the opening bell?

This depends largely on your goals. If you are trying to benefit from upward movement, buying at the opening bell would be ideal since stocks will likely open higher than their previous close price. On the other hand, if your primary goal is to avoid losses then it would be better not to buy until prices settle down following heavy volatility right after the opening bell.

You should try trading in the Diwali muhurat trading NSE session since it is a good opportunity to make maximum profits. Whether you’re trading in stocks or commodities, or any other kind of business, there are always ups and downs. Sometimes, your best-laid plans can fail at their very outset due to unforeseen circumstances. So it’s important to be aware of all that is relevant when you plan to undertake a new endeavor. That way, you can take measures that will not let your money, time, and energy go to waste even if things don’t go according to plan.