What is Stock Market timing?
Stock Market is an unpredictable place. But for an investor, it does provide both the risk and opportunity. It totally depends upon the type of investor, he/she is, whether he is an aggressive one or the passive one. But to make successful trades, an investor needs to know how to time the market. Timing plays a crucial role in maximizing gains or reducing the loss in a trade. But for any new investor, before they start trading in the stock market, they must know about one critical thing which may impact their trade, i.e. Stock Market Timing.
Every stock market in the world has certain fix timing of various trading operations. In India, there are two major stock exchanges in India, i.e.- BSE Sensex and Nifty. The timing of the Indian stock market is divided into three sessions:
- Pre-opening Trading Session
- Normal Trading Session
- Post-Closing Trading Session
- Pre-opening Trading Session:
The Pre-opening Trading session duration is between 9.00- 9.15 AM. Now, this is further divided into three sub sessions:
- Order Entry Session:
The timing of the session is between 9.00 to 9.08.
- An Investor or Trader can place their order to buy and sell stocks.
- An Investor or Trader can also modify their order.
- Order Matching Session:
The timing of the session is between 9.08 to 9.12 AM. The task undertaken under this sub session is following:
- Mainly for order matching and calculating the opening price of stock for the normal trading session.
- Apart from that, the investor or trader can modify, cancel, buy or sell stocks.
- Buffer Session:
The timing of the session is between 9.12 Am to 9.15 AM. This sub session is used as a buffer for any kind of abnormalities in the previous two sub session. Pre- opening session are mainly used by experienced investor.
- Normal Trading Session:
The start of the normal trading session is between 9.15 AM to 3.30 PM. One can buy and sell stock in the session. It is the session where actual trading takes place. It follows the bilateral matching session, i.e. when the buying price is equal to the selling price, then the transaction is complete.
The time of the post-closing session is between 3.40 PM to 4. 00 PM. In this session, a trader or an investor can place the order to buy and sell stocks at closing price. In case, if the buyer and seller or available during that time, then your trade will be confirmed at the closing price.
Apart from that there is other additional information regarding the Indian stock market timing:
- There is no break in the timing of the Indian Stock Market.
- Indian stock market has an open trading secret during Diwali 2018 and called as “ Muhurat trading session ‘’. It’s trading time is declared a few days before Diwali.
- The stock market is closed on the national holidays and weekends i.e. Saturday and Sunday.