Last Updated on November 7, 2023 by BFSLTeam BFSLTeam
Muhurat Trading is a special trading session, conducted during the auspicious occasion of Diwali. It holds a significant place in the hearts of many Indian traders and investors. It’s a time when the markets open for a short duration, typically about an hour, but it carries a unique sentiment. Traders see it as a chance to invoke good luck and fortune in their financial endeavours for the upcoming year. Both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) actively participate in this special session. The significance of Muhurat Trading goes beyond just buying and selling shares; it’s about embracing positivity and auspiciousness in one’s financial journey. Muhurat Trading might be brief, but it’s an opportunity that traders keenly await. To make the most of this auspicious session, traders often employ specific strategies to maximise their chances of success.
Here, we’ll explore some time-tested and proven Muhurat Trading strategies that you can consider:
Table of Content
Review Your Portfolio
Begin by assessing your existing portfolio. Identify underperforming stocks that you might want to sell or consider opportunities to reinforce your positions in fundamentally strong companies.
Additional Read: Muhurat Trading Hours 2023
Invest for the Long Term
Muhurat Trading isn’t just about making quick profits. It’s an excellent time to invest in companies that you believe have long-term potential. Focus on stocks with a solid track record, growth potential, and strong fundamentals.
Set Clear Goals
Define your investment objectives and risk tolerance. Decide whether you want to make short-term trades or prefer to hold stocks for a more extended period. Having clear goals will help you make informed decisions.
Additional Read: Diwali Market Analysis
Plan Your Entries and Exits
Determine the price levels at which you plan to enter and exit your trades. Having a well-thought-out plan can help you avoid impulsive decisions during the fast-paced Muhurat Trading session.
Diversify Wisely
Diversification is a fundamental strategy in any trading session, and the same holds true for Muhurat Trading as well. Spread your investments across different sectors and industries to minimise risk. Don’t put all your eggs in one basket.
Stay Informed
Keep an eye on market news and company announcements leading up to Muhurat Trading. Staying informed about recent developments can help you make informed decisions. Although the market sentiment around Diwali is usually upbeat, trading without relevant information is like swimming in the dark.
Trade with Caution
Muhurat Trading might carry a sense of optimism, but that doesn’t mean you should throw caution to the wind. Stick to your risk management rules and avoid over-trading or making impulsive decisions. Avoid getting carried away by the vibe of the occasion and keep your emotions in check.
Things to Keep in Mind
While Muhurat Trading can be a rewarding experience, it’s essential to keep a few things in mind:
- Timing: Muhurat Trading, this year, will take place on 12th November between 6:15 PM to 7:15 PM.
- Limited Time: Remember that this is a short session, so don’t rush into decisions. Take your time to make informed choices. Avoid making trading decisions owing to pressure of time or the fear of missing out.
- Historical Performance: Past performance during Muhurat Trading doesn’t guarantee future results. Be mindful of the risks involved. All your trading decisions should be backed by sound research.
- Risk Management: Always practise sound risk management principles, like stop loss, to protect your investments.
- Seek Professional Advice: If you’re new to trading, consider seeking advice from financial experts or advisors.
Additional Read: Sector Wise Performance in Diwali season
Benefits of Muhurat Trading
Muhurat Trading isn’t just about strategy; it also offers several benefits:
- Positive Sentiment: It’s a time when traders and investors come together with a sense of positivity and auspiciousness, setting a harmonious tone for the year ahead.
- Blessings for the Portfolio: Many believe that trading during this session can bless their portfolios and bring good fortune.
- Emotional Control: Muhurat Trading encourages traders to be patient, make thoughtful decisions, and not be swayed by emotions.
- Evaluate Your Approaches: Given the brief trading duration and typically lower trading volumes, this session presents an excellent chance to assess and put your trading techniques to the test in actual market conditions. It also serves as a valuable practice arena, particularly for beginners entering the realm of stock trading.
BFSL: Your Partner in Muhurat Trading Success
As you prepare for Muhurat Trading, consider leveraging the capabilities offered by Bajaj Financial Securities Limited. BFSL’s trading platform provides real-time market data, research reports, and advanced trading tools to assist you in making well-informed decisions. With the right strategies, a cautious approach, and the support of a reliable trading platform, you can set yourself up for success during this auspicious trading session.
Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.
Investments in the securities markets are subject to market risk, read all related documents carefully before investing
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Sources:
https://www.etnownews.com/markets/diwali-muhurat-trading-2023-guide-attractive-bets-which-stocks-to-exit-investing-strategy-for-first-timers-article-105005308
https://www.moneycontrol.com/news/business/markets/how-to-make-the-most-of-muhurat-trading-4577391.html
