Stockbrokers in India view Diwali as the start of their fiscal year. Many investors view this session as an opportunity to buy stocks and ensure prosperity for the coming year. Additionally, it gives traders the chance to open new settlement accounts and diversify their portfolios. Despite being mostly symbolic, Muhurat Trading usually draws a lot of activity, with many seasoned investors taking advantage of the chance to make changes to their portfolios. Nevertheless, market fluctuations are frequently erratic due to their short duration. Muhurat Trading not only celebrates the start of a new year but also represents hope and expansion for the forthcoming business season. It represents prosperity for the upcoming year and increases confidence in the stock market.
On Friday, November 1, 2024, from 6:00 PM to 7:00 PM, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) will hold their annual Diwali Muhurat trading session to mark the beginning of the Hindu calendar year Samvat 2081.
The session begins on Diwali, signifies the beginning of the Hindu calendar year, or Samvat. It is believed that trading during the ‘Muhurat,’ or auspicious hour, brings prosperity and financial growth for practitioners.
On Diwali, there will be a unique one-hour trading window available in the evening, but the market will be closed for regular trading. From 5:45 to 6:00 PM, there will be a pre-opening session.Experts in the market point out that Diwali is customarily regarded as the best time to launch new businesses.
Even though there is only an hour of trading and markets are often volatile, investors are thought to benefit all year long from taking part in this session. It is possible that the symbolic gesture is given more weight than financial gain. Securities lending and borrowing (SLB), equity futures and options, commodity derivatives, and currency derivatives are among the segments in which trading will occur during this hour.
Investors have historically seen favorable returns; in the last 17 special sessions, the BSE Sensex has closed higher 13 times. Even though the equity indices have performed well overall during these sessions, trading volumes have usually been low, and fewer stocks have made substantial moves during the short trading window.
An exception was in 2008, when the Sensex rose 5.86% in an hour, exceeding even the most optimistic expectations. It closed the day at 9,008, but because of the developing global financial crisis, it stayed mostly range-bound for the rest of the year.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
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