Is it permissible to buy and sell precious metals and commodities on the market?

Q: I am interested in trading precious metals and commodities on the market and wanted to know if this is halal. Looking at the market they seem to sell silver based on GBP. Am I allowed to buy and sell these items in the same way shares are bought and sold, in order to gain […]

Read more...

Is it permissible to purchase stocks using call and put options?

Q: Is it permissible to purchase stocks using call and put options? الجواب حامدًا و مصليًا و منه الصدق و الصواب A: Call and put options are essentially the sale of a right which one party gives to another in return for a fee. The option holder purchases the option to hedge against possible negative […]

Read more...

Is it permissible to work as an energy trader?

Q: Is it permissible to work as an energy trader? The role would involve trading futures contracts. الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب A: Trading in futures contracts does not comply with Shari‘ah requirements and so any remuneration earned for performing such activity is not halal. Essentially, a sale contract must be contracted at […]

Read more...

What is the Islamic position on ‘Spread Betting’?

Q: What is the Islamic position on ‘Spread Betting’?  Please find below two definitions given for this activity. From http://www.investopedia.com/terms/s/spreadbetting.asp Definition of ‘Spread Betting’ A type of speculation that involves taking a bet on the price movement of a security. A spread betting company quotes two prices, the bid and offer price (also called the spread), […]

Read more...

Is leveraged trading through a broker providing interest free brokerage account permissible?

Q: Is leveraged trading through a broker providing interest free brokerage account permissible? الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب A: Leveraged trading is not permissible as you are selling something you don’t have or does not even exist.    

Read more...

What is the ruling on Binary options trading?

Q: What is the ruing on Binary options trading?   الجواب حامدا ومصليا ومنه الصدق والصواب A:  Please see the following link: http://alqalam.org.uk/fatawa/investments-fatwa/is-it-permissible-to-purchase-stocks-using-call-and-put-options/ Binary options (all-or-nothing options) are simply another form of call or put options and are not sanctioned in Islam.    

Read more...

Is trading “covered warrants” on the stock market permissible?

Q: Is trading “covered warrants” on the stock market permissible? الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب A: Warrants represent a right to purchase an asset similar to a call option and do not represent the underlying asset itself. Thus, they cannot be traded.

Read more...

What is the Islamic position on CFD Trading?

Q: What is the Islamic position on CFD Trading? I know Spread Betting is not allowed and is fundamentally different to CFD Trading as the former is a synthetic market that can be manipulated by the market makers. Additionally, with regards to ‘owning the stock’, an individual does not own the stock if bought via […]

Read more...

How to determine the unlawful percentage received from dividends?

Q: I would like to know with regards to investing in stocks and shares more specifically on purification of the income received as a result of an investment in a company that is sharia compliant according to your screening criteria outlined in the article on ‘investing in stocks and shares’ http://alqalam.org.uk/research-papers/investment-in-stocks-and-shares/. The question I would like to […]

Read more...

Can I recover initial investments made towards CFDs?

Q: Would it be allowed to  recover my initial investment made into CFDs or do I call it ‘quits’?   الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب A:  You cannot take possession of any money that you have received through the CFDs investments even if it is to recover your initial capital deposit. As CFDs […]

Read more...