What Is Mahurat Trading investing?
Mahurat trading is the auspicious stock market trading for an hour on Diwali (Deepawali), the biggest festival for Hindus. Stock brokers’ offices take on a distinctly ethnic look with neatly designed rangolis and innumerable diyas lined up to welcome Goddess Lakshmi. Muhurat trading is one of the many links the broking community retains with its rich past. The practice of muhurat trading has been retained and observed for ages. Usually, the Sensex closes on a higher note on the muhurat trading day. Most traders buy on this day.
With this, the traders on Dalal Street welcome the New Year on a positive note. The traditional mahurat trading on the day of Diwali still retains much significance for many traders. Many start the New Year with traditional ceremonies and pujas.
Mahurat trading is traditionally an occasion for an auspicious beginning to the traditional New Year. Investors place token orders and buy stocks for their children, which are held for the long term and sometimes never sold. Traders normally book their intra-day profits, however small they may be.
For the forex trading communities of the north, the new financial year begins with Diwali. That is the reason puja is performed to accounts books and safes on Dhanteras as well as on Diwali day. A coin – which signifies wealth – is placed on the account books before the puja.
The time of the mahurat trading is specified by the stock exchange. It is a part of the traditional rituals among the stock broking community. The event is believed to bring in wealth. A nominal trading time is allowed.
Special about Muhurat trading:
Ethnic Look And Feel
For a change, stock broker offices will take on a distinctly ethnic look with neatly made rangolis and innumerable diyas lined up to welcome the mother goddess Lakshmi, and of course the clients and their better halves.
Global Outlook, Indian Core
The Muhurat trading appears to be the only link the broking community retains with its rich past. The trading ring has given way to the computer links and the only place you see the famous Gujarati topi is in the teak-framed photos of yesteryears.
For the trader, it pays to buy a day before and sell on the Mahurat trading day. A study of the last seven years show that on all the occasions the Sensex closed on a higher note on the Muhurat day. Most traders, in fact, buy on the Muhurat day.
The chances of selling on the next day at a loss are fair as, in four out of seven years, the Index has closed lower on the subsequent day. To assist the beleaguered pockets of someones celebrating the holidays, and to forbid spoiling the cheerful seasons because of a deficiency of cash in hand, a lot of lenders provide payday loan.
It pays to stick to the small-caps for trading as returns are usually better. In all the seven years under study, the returns in the BSE 500 are more than the Sensex.
Today’s Muhurat trading will be the first time the Sensex is in five digits. For the next 87,000 odd points this is not going to change.
Considering the fact that returns in this Samvat have been close to 62 per cent more than the cumulative return of the preceding two years, the probability of the markets doing an encore is less. But then optimism is what Muhurat is all about.
Source: Wikipedia / www.rediff.com (Muhurat trading / What Is Mahurat Trading)
