456 replies to this topic

[msaeed]

Dear All,

As long as I understand following are the Islamic ways of trading at stock exchange:

1: Day trade is unislamic. (Not sure about the delivery you are having)
2: GOLA or short selling of stocks (which you donot have in your posession) is unislamic.
3: Future trade in all respects is not Shariya compliant.
4: Shares bought under CFS are unislamic.
5: Shares bought with your own money(Delivery) cannot be sold for three days after buying if shariya compliant trading is in focus (Due to T+3). As soon as we shall have T+1 trading at KSE we shall be able to sell shares in one day(As per my information T+1 exists in UAE etc).
6:Most importantly we need to know the financial position of the company because debt to equity ratio(how much leverage company is enjoying).So small investors are advised to invest in cash rich companies.
7:Earning of company through interest (i.e cash is kept at bank and interest income is earned)should not exceed a certain level of total earning.
8: You can also invest in some shariya compliant mutual fund.

Disclaimer: These are all my own views based on my research and can be partially or totally wrong but posted on forum for a good cause and open discussion.

Please try to earn HALAL money and do your best to avoid unislamic ways of earning.

Best Regards,

[Sid2]

AbDuLmAtEeNkHaN, on Mar 1 2007, 10:41 AM, said:

One of Friend who is MasshAllah mufti have send me some material on stock market few days back ... main nay abhi parha nahi hay pura ..... kal topic dekha tu .. un sub papers ko scan kar kay ready kiya tha so just uploaded them hope kesi kay kaam ajay ga ....
http://www.4shared.com/file/11490688/6f29d...ell_in_KSE.html

Condition (3) states that there should be profit and loss sharing.

Condition (4) states that the share of profit should be fixed.


I think that these conditions are difficult to fufill by publicly traded companies on the KSE.

- The shares of KSE companies are issued on the limited liability principle. The most the person can lose is the value of his original investment but if, for example, the equity of a company becomes negative then he is not required to pay anything extra to share in the losses.

- Out of one year's profits, the company has complete discretion regarding how much to pay to shareholders as dividend, and how much to keep in its reserves, so the share of profit is not fixed.

[Muzammil Akhund]

what abt SPOT items (T+0) can they be bought and sold at same day ..r they islamic


: Shares bought with your own money(Delivery) cannot be sold for three days after buying if shariya compliant trading is in focus (Due to T+3). As soon as we shall have T+1 trading at KSE we shall be able to sell shares in one day(As per my information T+1 exists in UAE etc).

[Nomi929]

Muzammil Akhund, on Mar 3 2007, 02:38 AM, said:

what abt SPOT items (T+0) can they be bought and sold at same day ..r they islamic


: Shares bought with your own money(Delivery) cannot be sold for three days after buying if shariya compliant trading is in focus (Due to T+3). As soon as we shall have T+1 trading at KSE we shall be able to sell shares in one day(As per my information T+1 exists in UAE etc).

Shares,Commodities and Currency that are traded in SPOT i.e ( Items that immediately exchange hands between buyer and seller) can be traded .

Here is the book send to me by Mr. Ovais. It contains info about all the matters.

http://www.4shared.c...611794/bb424d42

Regards.

[msaeed]

Muzammil Akhund, on Mar 3 2007, 02:38 AM, said:

what abt SPOT items (T+0) can they be bought and sold at same day ..r they islamic


: Shares bought with your own money(Delivery) cannot be sold for three days after buying if shariya compliant trading is in focus (Due to T+3). As soon as we shall have T+1 trading at KSE we shall be able to sell shares in one day(As per my information T+1 exists in UAE etc).

In my view 3 days after buying are required so that at KSE these shares should be transferred to your name. So you should be termed as owner of this stock as per KSE record. If under SPOT these shares will be transferred to your name in one day then it is like T+1 and can be sold after one day.
Personally I have never done this and thanks for adding this new point in my information.

Keep sharing such information.

Disclaimer: Please do your own due diligence before making any decision. Above views are my personal views and can be wrong as well, because I am not an authority to comment.

[msaeed]

Shariya Compliant Trading,
How to earn HALAL money through trading of stocks?

Dear All,

As long as I understand following are the Islamic ways of trading at stock exchange:

1: Day trade is unislamic. (Not sure about the delivery you are having)
2: GOLA or short selling of stocks (which you donot have in your posession) is unislamic.
3: Future trade in all respects is not Shariya compliant.
4: Shares bought under CFS are unislamic.
5: Shares bought with your own money(Delivery) cannot be sold for three days after buying if shariya compliant trading is in focus (Due to T+3). As soon as we shall have T+1 trading at KSE we shall be able to sell shares in one day(As per my information T+1 exists in UAE etc).
6:Most importantly we need to know the financial position of the company because debt to equity ratio(how much leverage company is enjoying).So small investors are advised to invest in cash rich companies.
7:Earning of company through interest (i.e cash is kept at bank and interest income is earned)should not exceed a certain level of total earning.
8: You can also invest in some shariya compliant mutual fund.

Disclaimer: Please do your own due diligence before making any decision.These are all my own views based on my research and can be partially or totally wrong but posted on forum for a good cause and open discussion.

Please try to earn HALAL money and do your best to avoid unislamic ways of earning.

Best Regards,