- Forex Trading: Halal or Haram? – Practical Islamic Finance
- Forex trading halal ou haram em urdu
- day trading in islam
- Binary options halal atau haram,financialmarketswizard.com
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Assalaamu 'alaykum Is online forex margin trading halal or haram? My question might be cleared by the following example: I trade currency via an online trading platform. It is called 'leverage'.
Forex Trading: Halal or Haram? – Practical Islamic Finance
I will get profits or losses regarding to my transaction; if I buy then the price goes down, I will loss, vice versa. If I get profits, the broker will credit it into my trading account as the transaction closed with no delay. Conversely, if I loss, they will cut it from my trading account. Is this kind of transaction permissible in sharia law?
Because I have read split opinions about this leverage. PS: NO interest riba involved, because the broker provides no-interest accounts for Muslim traders. Therefore, bonds can be considered haram because they are based on an interest rate, even if when you invest through CFDs you do not receive interest, it is the value of the interest rate that is at the root of the spread. Therefore, investing in this asset would be like taking advantage of an interest rate. Futures contracts are also considered haram due to the deferred nature of the exchange of goods, after the "signing" of the purchase or sale agreement.
It is not immediate. Although there are no Islamic cryptocurrencies as such, that is, cryptocurrencies dedicated to Islamic finance, they work exactly the same as traditional Forex currency pairs. They are quoted against the dollar or another currency, so their fluctuations depend solely on changes in supply and demand. They are not based at any time on interest rates, directly or indirectly, which makes it possible to consider halal cryptocurrencies in the context of Islamic finance.
The MetaTrader trading platform is the most-used platform in the world. It is also the most popular trading platform among Forex brokers and online CFDs. So, what could be more normal than questioning whether it meets the criteria of Islamic finance?
Forex trading halal ou haram em urdu
The MetaTrader trading platform can be considered halal, simply because it is only a trading platform. In fact, this platform is just a tool, an interface that allows you to open your orders in the market. Regardless of the nature of the trading account you use, be it a standard account, a pro account or an Islamic account, your orders will be executed in the same way. Only your broker can define the trading conditions with which you are going to invest, the platform does not alter or modify them in any way.
In addition, only the trading account you choose will have an impact on your trading conditions and can become a halal or haram trader. Hence the importance of choosing an Islamic trading account with your broker so you don't have to pay interest rates. You can learn more about how MetaTrader works or about general trading concepts with our free online courses:. Let's now look at some trading strategies to use in your broker's account without swap. Day Trading is one of the three types of trading, along with scalping and swing trading that we will analyse.
This type of strategy consists in opening positions that will be closed during the sessions, that is, before the markets close at the end of the day.
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The interest of this type of operations during the same session is the fact that the open positions are not kept at night, the payment of swap commissions is avoided and, therefore, the interest rates, even if you are not operating in an Islamic trading account without a swap. Sometimes a trader opens a position in the morning, with the intention of closing it at the end of the day, but at the end of the session the position is making a profit and the trader anticipates that the movement should continue. In this case, it may be prudent for him not to close his position and maintain it for a greater benefit.
day trading in islam
If the trader has an Islamic account, he can take full advantage of this opportunity, but if the trader has a standard account, he will have to give up this potential gain to respect the principles of Islamic finance and not pay interest rates. Trading in a non-Islamic account also exposes the Islamic trader to the risk of forgetting and falling into a haram trading activity. Like intraday trading, scalping is a trading style.
This implies the opening of positions, by the trader, that are destined to close quickly, in a few minutes or even a few seconds. The goal of a scalper a term that refers to a trader who practices scalping is to open many small positions by earning only a few points in each of them. The advantage of scalping is that, as with intraday trading, as positions are closed quickly there is no interest rate payment, since the position will close after a few seconds or minutes. Therefore, an Islamic scalper can easily use a standard account and is not limited to the use of an Islamic trading account.
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On the other hand, as with intraday trading, if the scalper wishes to maintain a position for a longer period of time, and this position is destined to become a long-term position to accumulate more attractive potential benefits, he will have to use an Islamic account, otherwise you will have to cut your position to avoid paying interest.
Swing trading consists of opening positions for several days or even weeks. Therefore, a swing trader that respects the principles of Islamic finance must work with an Islamic account, no matter what, if you want to avoid paying interest. Swing trading is considered the least risky of the three short-term investment approaches, but a swap-free trading account is essential for an Islamic trader.
The main difference between Islamic accounts and basic accounts is that there are no swap commissions. This can be a very important advantage, since you can open long-term positions without running the risk of reducing your profits due to swap commissions. The second great advantage is that the trader will be able to open positions in currency pairs in which swaps costs are generally very high especially in exotic pairs.
The absence of the swap can also be detrimental to the halal forex trader, since it will not be able to benefit from the positive interest payments that are often paid to short positions, along with the benefits of carry trading strategies. Often, to remain profitable after the elimination of interest, the non-swap broker will charge a fixed administrative fee, as banks do in Islamic finance. It is clear that halal trading will depend partly on your actions and partly on the broker you choose.
Once you have tested the conditions of the broker and practiced in a demo account you can open an Islamic account to start trading. Admiral Markets is a multi-award winning, globally regulated Forex and CFD broker, offering trading on over 8, financial instruments via the world's most popular trading platforms: MetaTrader 4 and MetaTrader 5. This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer or request for any transaction in financial instruments.
Keep in mind that such business analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decision, you should seek the advice of independent financial advisors to ensure that you understand the risks. We use cookies to give you the best possible experience on our website. By continuing to browse this site, you give consent for cookies to be used.
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