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Madinat al-Muslimeen Islamic Message Board
| Can muslims use shares? |
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| Chris |
| 01/14/03 at 15:29:21 |
| I have to do a project with a muslim on shares and we were wondering if Muslims can trade in stocks and shares? Are they considered as Interest, or something else? Chris |
| Re: Can muslims use shares? |
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| jannah |
| 01/14/03 at 16:35:22 |
| Hey Chris, In general, common stocks in companies that are not partaking in any haram(restricted) things is allowed. Like I guess blue chip, pharmaceuticals, etc.. Preferred stock, bonds, futures are not allowed because they all involve interest or gaining money based upon money wth no risk involved. Islamic financing and ecnomics is a huge, complex and vast topic which is pretty interesting too. Here are some sites for more study: http://www.islambank.com/ <---- our own bro himy's cool site http://muslim-investor.com/mi/ http://islamic-finance.net/ http://www.maktabaonline.com/elief.html http://www.islamic-economics.com/ http://www.albalagh.net/Islamic_economics/ http://www.usc.edu/dept/MSA/economics/ http://www.cie.com.pk/ http://www.irti.org/ |
| 01/14/03 at 16:48:35 |
| jannah |
| Re: Can muslims use shares? |
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| Chris |
| 01/14/03 at 16:54:14 |
| Thanks, Jannah, you're a gem. Hope others appriate you. C |
| Re: Can muslims use shares? |
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| Moe_D |
| 01/15/03 at 11:46:32 |
| [slm] Jannah, i knew that one could not have stocks in companies that are involved in any haram things. But most tech, pharmaceuticals, automobiles and etc.. are all ok. But what about companies who are in the millitary industry?? i mena not all countries buy military equipment for an evil purpose. or what about companies that are involved in cloneing people? or at least trying to clone people?? But why common stocks allowed and Preferred stock not ??? preferred stocks might have less risk and are guaranteed a dividend but that and voting rights are the only major diffrence. im having trouble understanding this as ive never learned much about what islam has to say about interest other then its haram. But i see everyone buying homes, property and businesses with a mortgage. any help or opinions would be appreciated :) Thanks, Mohmmad |
| Re: Can muslims use shares? |
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| jannah |
| 01/15/03 at 12:08:18 |
| [wlm] bro that's why it's a complex and vast issue ;) very few of these things existed at the time of the prophet [saw] so now scholars and financial experts are struggling to take what existed then and the principles and try to apply it to modern day things like 401ks !!! mortgages is a hotly debated issue...one scholar says it is ok only under the condition that you would never be able to buy a house on your own even if you save your whole life and that it is your primary residence and some other things... other scholars are like no way it's still interest so there's a lot going on here besides "interest is haram".. i mean they have to figure out what is interest.. what does it mean and is X interest and what if the shariah isn't being fulfilled through it and its actually doing the opposite of what was intended... so go check out those sites :) btw prefered stock is guaranteed dividends.. basically ur making money b/c u have it with no risks... it's interesting that this is haram in an islam. so in an islamic society u can't just make money b/c u have it, thereby perpetuating the status quo and making the rich richer, u have to spend ur money, risk it...thereby spreading it in the economy....i forget what u call that in economics 101 :) Here's 3 books online: [url=http://www.wponline.org/vil/Books/MG_CIBF/default.htm]A Basic Guide to Contemporary Islamic Banking and Finance[/url] by Mahmoud Amin El Gamal [url=http://www.wponline.org/vil/Books/MF_ICIT/Default.htm] Islam and Contemporary Economic Theories[/url] by Dr. Mohammad Shawqi Al-Fanjari [url=http://www.wponline.org/vil/Books/MF_EEP/default.htm]The Essence of Economic Policy in Islamic Economics[/url] by Dr. Mohammad Shawqi Al-Fanjari |
| 01/15/03 at 12:09:22 |
| jannah |
| Re: Can muslims use shares? |
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| Dawn |
| 01/16/03 at 15:30:17 |
| Hmmm, I think this might be a good thread to ask a question I stumbled into concerning Rent vs. Riba. I read the following article [url]http://www.understanding-islam.com/related/text.asp?type=question&qid=135[/url] and I will reproduce the relevant portion below: [i]Keeping the above points of distinction in mind, it should be clear that a rental agreement is quite distinct from a Riba-based loan or financing agreement. A Rental agreement can only be comparable to a Riba-based loan or financing agreement if: [list][*]It requires the tenant to pay the periodic rent; [*]It is irrevocable till the full value of the rented asset is received; and [*]It requires the tenant to return the original (full - i.e. 100%) value of the rented asset at the end of the rental agreement (this implies that at the end of the rental agreement, the tenant be required to return the rented asset, not in its existing state, but in its original state at the time the rental agreement was contracted). [/list] In the absence of these clauses, it is quite obvious that a rental agreement is distinctly separate from a Riba-based loan or financing agreement.[/i] Is this implying that if a rental agreement actually contains one or more of these clauses, then it would be haram to enter into it? For instance, here in Switzerland, when one rents an apartment, one is required to return the apartment in the condition which it was in when one moved in, or else pay for the owner to have it fixed up again. Clearly, the third clause is violated by such a requirement. Also, renters here are not allowed to just "leave" their rental contract. That is, if the contract goes till May, and you want to leave for some reason in February, you are required to pay the rent until May, or find a subletter which the owner approves of. This is true, even if you can't pay the rent and so move out (an example given in the article). Even in such a case, you are still responsible for the rent through the end of your contract, unless a suitable (again, to the owner) subletter is found. I think this is somewhat similar to what is meant by the first clause above. Or, would ALL THREE of these clauses have to be present for a rental contract to be considered the same as riba? Thanks in advance! With Peace, Dawn |
| 01/16/03 at 15:30:48 |
| Dawn |
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