Indian stock exchanges will hold a special Sunday trading session to mark the beginning of Samvat 2083. Here are the timings, historical returns and precautions investors should consider.
The stock markets will open for the special Muhurat trading session on November 8 to celebrate Diwali and mark the beginning of Samvat 2083, the new Hindu calendar year. The National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) have announced an afternoon trading window, continuing a departure from the traditional evening schedule.
For many investors, Muhurat trading is an opportunity to make a symbolic investment at an auspicious time. However, historical market performance suggests that buying shares during the special session does not necessarily guarantee profits in the months ahead.
According to the exchange circulars, the special session will follow this schedule on November 8:
Pre-open session: 2.05 pm to 2.20 pm
Special trading session: 2.20 pm to 3.30 pm
Normal trading in stocks covered by the closing auction mechanism ends at 3.15 pm, followed by a special auction window
Equity derivatives trading: 2.20 pm to 3.40 pm
This will be the second consecutive year that Muhurat trading takes place in the afternoon rather than the evening, as was customary for decades.
Regular trading will resume on Monday, November 9. However, the exchanges will remain closed on Tuesday, November 10, on account of Diwali Balipratipada.
Muhurat trading has its origins in the traditional practices of Gujarati and Marwari business communities.
During Diwali, traders would close their old account books and begin new ones after performing a ceremonial prayer known as Chopda Pujan. The practice symbolised prosperity, financial discipline and the beginning of a new business year.
The BSE formalised Muhurat trading in 1957, followed by the NSE in 1992. Over the decades, the practice has evolved into a widely observed stock market tradition, attracting participation from investors who regard the occasion as an auspicious time to begin or add to their investments.
Historical figures suggest that Muhurat trading sessions have generally produced positive returns, although the gains have been modest. Between 2015 and 2024, the Nifty recorded an average gain of 0.53% during Muhurat trading. The index finished higher in eight of those ten sessions.
The previous year's session also ended with marginal gains:
Nifty: Rose 0.10% to close at 25,868
Sensex: Gained 0.07% to finish at 84,426
These figures highlight a positive historical tendency during the special session. However, a rise during Muhurat trading cannot be treated as a reliable indicator of how the market will perform throughout the new Samvat year.
Market movements over the longer term depend on several factors, including corporate earnings, economic conditions, global developments and investor sentiment.
Although Muhurat trading carries cultural significance, transactions executed during the session are genuine and legally binding. Investors should therefore approach the occasion with the same caution they would exercise during regular trading.
Key precautions include:
Make symbolic investments: Investors can consider allocating a small amount to fundamentally sound companies they have already researched, rather than buying unfamiliar stocks simply because it is an auspicious occasion.
Prefer limit orders: The shorter trading window can lead to sudden price movements. Limit orders allow investors to specify the price at which they are willing to buy or sell.
Avoid excessive leverage: Highly leveraged derivatives positions can expose traders to significant losses, particularly during volatile trading sessions.
Maintain a long-term perspective: A gain or loss during the special session should not determine an investor's strategy for the entire year.
Muhurat trading is primarily a symbolic beginning to a new financial year rather than a dependable opportunity for immediate gains.
While investors may associate the occasion with prosperity, the performance of their investments will ultimately depend on the quality of their decisions and the broader market environment.
The historical record shows that Muhurat sessions have frequently ended in positive territory. But those gains offer no assurance that the market will continue rising.
For long-term investors, the occasion may be an opportunity to review their portfolios, reassess financial goals and make carefully considered investments instead of pursuing short-term profits.
Disclaimer: This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security or mutual fund.
