Muhurat Trading Time 2020 & its History

thumbnail
Reading Time: 3 minutes

This article has been written by Priyansh Chachani for FinMedium Research Desk.

What is Muhurat Trading and Muhurat Trading Time of 2020?

The word Mahurat in Sanskrit means an auspicious day or time as per the Hindu calendar. During this time, planets align themselves in a pattern, and doing trade at this time is said to bring wealth the entire year.

BSE CEO, Mr. Ashish Chauhan, performing Laxmi Puja during Muhurat Trading | Source: Prokerala

Most of the traders trade during this time for religious, sentimental, and traditional reasons.

As on the day of Diwali, people also do Lakshmi Puja, this Mahurat Trading is said to be auspicious as it brings wealth the whole year.

This ritual is followed by the trading community since ages.

This happens on the day of Diwali every year and the time for the same is notified by exchanges every year. It is generally held during the evening and all traders participate during this time.

Also Read on FinMedium:  The marginal utility of Money

History of Muhurat Trading

This all started back in 1957 in the BSE when Hindu traders used to celebrate this auspicious day of Lakshmi Puja and mark the start of “Naya Samvat” (New Year).

Back in those days, when there were no electronic ways of trading, people used to gather at the BSE trading ring for an hour or so to trade.

On this day, jobbers were also allowed to bring in their friends and or family members and clients to show how trading happens at the BSE.

There was an exchange of sweets among everyone and that day used to be one of the most awaited days of the years.  

In the outcry system, as there were tables for jobbers trading into the company so one must go for that table to trade into that company.

It mostly used to be in the afternoon or evening. BSE was dominated by the Gujaratis and Marwadi clans and there always used to be a tussle of supremacy at the BSE.

Jobbers were to trade for their brokers. Jobbers used to say that if you buy a share on Diwali, one will have a lot of luck in that share. That share would give you handsome returns and would multiply your wealth.

Also Read on FinMedium:  #22 Surveys are important! - Bank on Basak

Markets on Mahurat Trading Day:

In the past out of 14 sessions markets have been positive in 11 sessions of Mahurat Trading. Last year Sensex rose 0.7% while Nifty 50 rose 0.65%.

muhurat-trading-time-bse
BSE CEO, Mr. Ashish Chauhan, during Muhurat Trading | Source: ET

In October 2008 when the whole world was doomed by the Financial Crisis, Sensex rose nearly 6% which shows how important and full of optimism the Mahurat day can be.

Things that one should know:

  • Propitious day to invest: It is one of those auspicious days to invest in the market for long term purpose in some good companies who can provide you returns of more than 10-12% a year. One should also check on the market sentiments in the past few trading sessions to have a better idea of what to expect when the markets open on Mahurat.
  • Opportunity for new investors: Once a newcomer has gained knowledge about investing and trading, this could be a day to enter the markets.
  • Good for Intraday profits: As many traders feel that this is an auspicious day and markets will remain bullish so for those intraday traders this is a good day to trade and book profits.
Also Read on FinMedium:  Orient Carbon OCCL Business Analysis

Also Watch: Diwali Muhurat Trading

What could we expect this year?

As this is a pandemic year which has been a lot of pessimism in the first half, this could be one of those days to be full of optimism.

Looking at the global sentiments, Joe Biden winning elections has uplifted the markets, vaccine news has given another booster to this upswing in the markets so this Mahurat day we can expect a good move in the markets.

Muhurat Trading Time for Year 2020

MUHURAT TRADING TIME & SESSIONCAPITAL MARKETEQUITY DERIVATIVESCURRENCY
DERIVATIVES
COMMODITY
DERIVATIVES
SECURITIES
LENDING &
BORROWING
SCHEME (SLBS)
Block Deal Session17:45 – 18:00 hrs
Pre-Open Market18:00 – 18:08 hrs
Normal Market18:15 – 19:15 hrs18:15 – 19:15 hrs18:15 – 19:15 hrs18:15 – 19:15 hrs18:15 – 19:15 hrs
Call Auction Illiquid session*18:20 – 19:05 hrs
Closing Session19:25 – 19:35 hrs
Set up cut off time for Position Limit / Collateral value19:25 hrs
Trade modification18:15 – 19:45 hrs19:25 hrs19:25 hrs19:25 hrs
Muhurat Trading Time 2020

This article has been written by Priyansh Chachani for FinMedium Research Desk.

Cover Image: ET

Every Wednesday and Saturday, we send Info-Graphic and FinMedium Weekly Digest newsletters to our 25000+ Subscribers.

Join Them Now!

Please Share :)
FinMedium Research Desk
Read our research and analysis on Sectors, Companies, Investing Ideas, and other cool financial stuff. All from our in-house Research Desk.
Back To Top