With Diwali around the corner, people across the country are preparing for celebrations. Like Diwali isn’t complete without lights and sweets, for traders and investors, celebrating Diwali is incomplete without participating in Muhurat Trading. It is one-hour symbolic trading observed every year on Diwali evening before or during the puja hours.
In Hinduism, Muhurat means an auspicious time of the day as per the alignment of the stars and planets. Unique to India, the tradition includes investors and traders participating in the stock market as ‘Shagun’ (good omen) to seek the blessings of the Goddess of Wealth – Goddess Laxmi.
It is believed that if you initiate something during the Muhurat, the auspicious period, it will be rewarding. Taking place in India for more than 50 years, Muhurat trading is also built on the same belief.
Around this time, Dalal Street investors and traders also encourage people to join the stock market and recommend doing so by making their initial investments during the Muhurat Trading hour.
If you are someone who has been planning to invest in the stock market, Muhurat Trading time is the best to make that first purchase of shares on Diwali.
There is no better reason than an auspicious occasion to start your investment journey, but here are some other reasons why you must start investing this Diwali:
Investing in stocks or any other assets means growing your wealth to achieve personal goals. Investment tools like stocks, bonds, and mutual funds help you grow your wealth over the long term. Even though the stock market can be volatile, stocks have a lot of growth potential and have historically delivered healthy returns. Investors reap positive returns if they continue investing over a long period of time.
Saving for Retirement
Another reason to start investing is to build a source of income for retirement. You can’t be working throughout your life. You can build a retirement portfolio which comprises different asset classes. One of them can be a stock investment. Once you are retired, you can live off the returns earned on the stocks you have invested in.
Achieving financial goals
Starting investment at the right time also enables you to reach your financial goals. Investors earn better returns by investing their money in stocks instead of putting it in a savings account. You can invest based on your short-term goals like a vacation and long-term goals like purchasing a house or a car or starting your own business, or sending kids to college.
How to start investing during Muhurat Trading?
Investors and traders who are planning to start investing this Diwali will have to start by opening a Demat account, which they can do either on Diwali or before the festivities set in. A Demat account is mandatory to start investing in the stock market. A Demat account stores your shares electronically, enabling you to easily transact in them.
Plan your investments
Once you have opened the account, you need to decide the amount you want to invest as your first-time investment. It is best to invest in a phased manner as compared to lump sum investing.
Select your assets
Demat account gives you a plethora of investment options. So you must research in advance and choose whether you want to invest in stocks, Futures & Options, mutual funds, etc.
Picking the stocks
If you are a new investor and picking the stock for your first investment, you can choose shares of large-cap companies with strong financial backgrounds. Being new to the stock market, you have the liberty to choose a small number of shares for investment, but make sure they are part of your long-term plan.
Muhurat trading in 2022
Muhurat Trading will take place on 24th October from 6:15 PM to 7:15 PM for trading in equity, equity and derivative segment on NSE and BSE. The pre-open session timings are 6:00 PM to 6:08 PM. Trade modification in the call auction will end at 7:45 PM this year.
To start your investment journey in the stock market, you can simply place an order during the Muhurat hour.
Buying shares on Muhurat trading and starting your investment journey during an auspicious time is not something you can always do. The opportunity comes once a year, and people considering starting an investment must leverage it.
However, new or seasoned investors must keep their emotions aside while investing in the stock market during Muhurat Trading and otherwise. Keep fear and greed both aside while investing.
(The author of this article is Chief Growth Officer, Angel One)
Disclaimer: The views and recommendations given in this article are those of the author. These do not represent the views of MintGenie.