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Muhurat trading, a unique tradition observed in India, takes place on the evening of Diwali, an auspicious festival of lights. During this special trading session, which typically lasts for an hour, investors believe that buying stocks and other financial instruments will bring good fortune and prosperity in the coming year. This belief is rooted in the cultural and religious significance attached to Diwali, a time for new beginnings and wealth.
The practice of Muhurat trading stems from the belief that starting new ventures during this auspicious time will lead to success. This sentiment extends to the stock market, where investors see Muhurat trading as an opportune moment to add promising stocks to their portfolios. Despite the sentimentality surrounding Muhurat trading, it is important to note that the stock market remains subject to market forces and economic factors. Past performance does not guarantee future returns, and investors should conduct thorough research and analysis before making any investment decisions.
For those who do not possess a demat account, which is typically required for stock investments, there is an alternative way to participate in Muhurat trading: investing in mutual funds. Mutual funds allow investors to pool their money together to invest in a diversified portfolio of assets, including stocks, bonds, and other instruments. This approach eliminates the need for a demat account, making it accessible to a broader range of investors.
Investing in mutual funds during Muhurat trading can be done through the mutual fund house website. The process involves logging in, selecting the desired scheme, specifying the investment amount, and choosing the preferred investment mode, whether a lump sum investment or a systematic investment plan (SIP). However, it is essential to note that Muhurat trading is primarily associated with stocks, gold, and ETFs, and not necessarily with mutual funds. While mutual funds can be purchased during this time, it is not considered a traditional practice.
Despite the sentiment attached to Muhurat trading, it is crucial for investors to approach this event with a rational mindset. While the belief in its auspiciousness might be comforting, it should not overshadow the importance of sound financial planning and investment strategies. The decision to invest during Muhurat trading should be based on a thorough analysis of market conditions, individual financial goals, and risk tolerance.
Ultimately, Muhurat trading serves as a reminder of the deep cultural and religious significance that permeates various aspects of Indian life, including financial markets. While the practice holds a special place for many investors, it is essential to approach it with a balanced perspective, blending tradition with informed investment decisions.
Source: Muhurat Trading: Can you invest without a demat account during the auspicious hour today?