Buying share, stocks and mutual funds : investment techniques in stock trading

Fatawa Question

Dear Sir.... I am a Muslim Egyptian and I have a question for you please. I am an investor in the Egyptian stock market where there are some rules ; price changes have a 5 % limit for up and down movements, also we have three days for settlement before which we cannot sell any purchased stock... BUT the market is full of speculators and there are large price swings mainly attributed to the economic disturbances in the last year, but these price changes are more or less predictable so some investors usually follow this technique… They buy a special amount of a certain stock and keep it (I do follow Islamic restrictions on buying stocks acc. to Dow Jones Criteria)....... During market rises they buy another amount of the same stock (this technique allows them to sell the older amount before the settlement of the newer one. So they profit even if the market rise ends before the three days)................. Is that permissible from the Islamic point of view ? Thank you and jasakom Allah khairan for your patience and precious time.

Fatwa

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Publication Date

2001-08-08

Main Subjects

Financial and Accounting Sciences
Religion
Islamic Studies

Topics

• Islamic jurisprudence
• Investments
• Purchasing
• Stocks

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-726850

• APA
• MLA
• AMA