A solid and respectable Forex broker will have concrete answers and will make you feel at ease, not uncomfortable. But there are many Forex brokers who are providing such special Islamic swap free account for those Islamic traders.
What is the ruling on Forex Trading in Islam?
You have just executed a speculative option contract that you expect, for example, EUR to go higher or lower. So in short, you own nothing, you trade the speculation. The leverage is basically a conditional loan, given to you on the bases that you will only be able to use it for trading with the same broker. This is not permissible according to the Hadith:. Thank you for the A2A.
So if i want to answer it,it will be too long to write and maybe more complicated to understand. So i would like to suggest you a link to check out the answer. Ruling on trading in currencies. Need to ask a jurisprudent or faqih. In general trading buying and selling of goods and services is halal and is actually encouraged. Islam generally has a good attitude to business and enterprise. Before I went to Malaysia last time I did a massive research on this topic. Gambling is haram in Islam and there is a thin line between trading and gambling, we all must admit it.
But the good news is that you can avoid being a gambler. If you manage to stay on the positive side of your will, then Forex is Halal in Islam. The above conclusion was made based on real discussion with Islamic Scholars. You can see the complete Islamic Forex research  here.
Hai guys just a quick question. Some say forex is Halal and some is Haram. Is is Halal if it is in the same sitting which means you buy or sell the currency on the spot which in forex it means Market Order. So is this Pending Order considered Haram? So, anything that involves speculation or charging or gaining interest is a no no, as in Haram. You need to choose Islamic broker with no swaps.
This page may be out of date. Save your draft before refreshing this page. Submit any pending changes before refreshing this page. Ask New Question Sign In. Is leverage in forex haram? Is trading stocks halal? Can all muslim business work forex in market? Is forex halal or haraam? Is forex trading halal or haraam? I'm a muslim and yes I do trade fx.
And I once argued with one of my colleague about it he's an old timer conservative. Since both of us working abroad, I explained to him that either profit oriented or not, both of us are involved in currency trading. Just like transferring money home, as USD is our world's reserve currency which means we're indirectly involved in currency trading even in an atomic portions of it fx trading circulates over 5 trillion dollars a day. So yes, we're all in it. The thing that makes it quite questionable is regarding swap for as muslims it's clearly categorized as riba just like loans interest.
But nowadays many brokers provide swap free or islamic account for higher spread as consequence. Yet from my personal view and many fellow agree with it, there's another catch that makes trading to be considered as haram. Jumping in a trade as rolling a dice without proper analysis and such could put you in a gambling situation. It's a bit blurry so to say.
But if you're honest to yourself, you know whether you're trading or gambling. And to support my answer, trading without swap is considered as halal by Islamic authority in Indonesia - my home country- which is the largest muslim country. Learning to do our best in trading should prevent us from making ourselves gamblers in trading fields. Thank you for your feedback! Scholarly response to the question.
And Allaah is the source of strength. Quora User , works at Pritle. Answered Dec 29, Answered Sep 24, This is not permissible according to the Hadith: I'm a Hindu by religion but I have read many things about Islam it is somewhere written that forex trading when done physically on the spot is Halal and permissible.
Any profit earned from such trade is permissible. Link- Ruling on trading in currencies. Answered Nov 25, Many broker offers Islamic account that are swap free, or interest free, meaning that you do pay or get any rollover when holding a position overnight. The broker usually charges a higher spread to make up for it. Answered Feb 10, Footnotes  Forex is Halal or Haram? Is Forex trading haram in Islam? No, if the trade is done at spot or without profit for either side of the transaction.
Answered Apr 21, Answered Jan 14, There is no actual buying or selling or owning of the currency. And so, we still have to ask: Is this type of speculation permitted for those who follow Islamic law? Islam understands that everyone strives to earn more money and that every opportunity to enhance your financial standing comes with a certain level of unpredictability.
When faced with multiple opportunities, we aim to combine research with past experience to choose the path that will lead to the most favorable results. However, according to Islamic law clearly prohibits gambling. So, what makes Forex trading okay and permissible according to Shariah law?
One author suggests that is the method of research used for the currency speculation that makes Forex trading either permissible or banned. On the simplest level, one could argue that using fundamental analysis is allowed but using technical chart-based analysis is not.
With technical analysis one speculates on the bets of others, relying on others to influence his or her position, which connects trading closely to gambling, a pursuit that is clearly prohibited by Islamic law. Critics of this reasoning challenge: Perhaps it can be argued that a Muslim cannot speculate on the currency markets unless he or she has strong basis upon which to expect a positive outcome.
Accordingly, all trades must then involve either fundamental analysis or chart-based analysis that the trader has a strong belief in.
It is easier to establish a probable technical trend, and it will probably have underlying fundamental reason than using a fundamental outlook. In this case, Forex trading could theoretically be permissible according to Islamic law. Based on our findings, it would seem that as long as there is no question of riba, the trade is made hand to hand the exact definition of this phrase is still open to interpretation for many Muslims , and the person doing the exchange has a valid reason upon which to expect profit, currency exchange is permitted according to Islamic law.
There are many Islamic Forex brokers who ensure all of this is taken into account when a Muslim would like to open Forex account and trade.