In Islam, not every type of trade is allowed, and therefore some brokers have created accounts for representatives of this religion with special conditions that meet their spiritual needs.
The rules of Islam sometimes differ from the financial traditions of the Western world. Therefore, not all brokers are ready to meet Muslims halfway. In addition, customer service on special terms is often less beneficial. And, nevertheless, a trader who wants to open an Islamic account will have an impressive list of reputable companies that provide such an opportunity.
Features of Islamic accounts
Perhaps the main feature of Islamic accounts is the absence of swaps inherent in most other types of accounts. That is, there is no interest that a trader usually receives or pays for leaving a position open during the day overnight.
It is forbidden to use leverage as loans are not permitted by Islam. But it is possible in Islam to borrow money without interest in order to profit from it and return the same amount.
But the broker must also make profit from clients. Therefore, users of Islamic accounts pay margin and fees.
Traditionally in Islam it was believed that trade deals should be concluded only when its participants look each other in the face, hit each other on the hands. In the modern world, this is rarely possible. Therefore, the concepts of the correctness of transactions have been transformed. And now it is believed that the exchange should take place immediately, which corresponds to the speed of the Forex market, where the execution of orders usually takes a fraction of a second.
What can Muslims trade
Having dealt with the basic principles of trading, the believer may wonder what tools are available for him in trading. Almost everything except binary options, futures and bonds. They do not meet the requirement for here and now transactions. Binary options have an expiration period - the closing of the transaction. Futures contracts have pending rather than instant execution. Bonds have a fixed interest rate linked to the life of the security.
Trading in stocks is also not a sin. Indeed, in this case, a person becomes a co-owner of the company, which is quite natural for representatives of any religions. Another thing is what kind of business a particular organization is doing. If it is related to gambling or alcohol production, then believers will not buy stock. But if a company produces, for example, food and alcohol too, then there is a way out of this situation. Let's say the share in the total income from alcohol is 10%, then the shareholder gives 10% to charity.
Gambling is also prohibited in Islam. But if someone compares them to trading, then they are deeply mistaken. After all, success in the game is an accident. And profit from transactions is based on forecasting based on analysis.
Summing up, we can say that if you adhere to the Muslim religion and still have doubts about whether it is worth working on Forex, then it would be best to contact a representative of the clergy with a question.