Muhurat Trading 2022 Do’s and Don’ts: Time is your friend and impulse can cost you your money

Diwali marks the start of the Hindu New Year calendar. Throughout India, this festive period is considered the most auspicious time to welcome wealth, prosperity and luck. Right from Diwali poojan to business activities, everything revolves around favorable Muhurat and pleasing the gods of money. As a centuries-old practice, the exchanges will open for a special Muhurat session on October 24, 2022, from 6:15 p.m. to 7:15 p.m. The pre-opening session will begin at 6 p.m. for 15 minutes.

The “Muhurat” for the one-hour special trading session is announced based on the auspicious planetary positions. A lot of excitement and interest is seen among new and active traders and investors across the country during the Muhurat session. More than booking profits, investors are especially excited to participate in this customary and auspicious trading ritual. More so, even new ventures, business activities and business projects are also ushered in during this festive season for a good start and favorable returns next year.
If you too are planning to complete your portfolio on the auspicious day of Diwali and looking to welcome fortune and good returns from the markets, let us understand the best way forward.
Time is your friend; impulse can cost you money
Whether a new investor in the markets or an active trader, everyone on the day of the festival during the special one-hour trading sessions full of festive cheer and looking to make a trade for good reasons. And historically, 11 out of the last 15 Muhurat Trading sessions have been positive. However, markets move with fluctuations and therefore it is recommended to always trade quality and fundamentally sound stocks. You should not make impulsive decisions without knowing the investment logic.
All major brokerages along with market experts are sharing the best stock picks for the samvat new year and muhurat stock ideas for long and medium term investors a few days before Diwali. You should read these reports beforehand and be sure that you can make informed decisions during an hour of muhurat trading. You should refrain from buying penny stocks based on the whims of headlines or social media trends that day.

Moreover, buying gold is also considered auspicious during Diwali. Investors of any ticket size can buy gold by investing in gold ETFs. Adding gold will also diversify your portfolio. Those who are new investors and particularly risk averse can also choose to invest in top-rated mutual funds during Muhurat Trading.

As Muhurat trading is a short one-hour window, one should be vigilant and knowledgeable about the fundamentals of stock picks. Stick to the basics and don’t make hasty decisions for quick short-term returns. It is always advisable to keep in mind the medium and long term investment periods. New investors should also avoid trading options as it is a high risk, high reward instrument. Be informed and choose stocks based on your time horizon, risk appetite and profile.
Happy Diwali.

The author is Vice President, Research, Religare Broking.