Is leverage or margin trading halal?
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Thanks for watching our video: Is leverage or margin trading halal?
Margin and leverage involve the broker lending the customer money (providing margin) to trade with.
So it’s a loan from the broker to the customer.
In Islam there are two types of loans:
Charitable loan (Qard Hassan), The lender does not expect to benefit in any way in this life.
Ribawi loan, the lender expects to benefit from their loan.
There’s no third kind.
Being a party to a ribawi loan is prohibited in Islam.
Allah’s Messenger (ﷺ) said: cursed is the one who receives riba, the one who pays it, the one who writes it, and the two witnesses, and he said: they are all equal.
Some brokers benefit explicitly from extending margin by charging interest while others benefit in more subtle ways through payment from order flow or something else.
In any case, what we can be absolutely certain of, is that the brokers loan to the customer is not done as charity.
Therefore it must be a ribawi loan and haram to use.
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Our channel is about helping people invest to build wealth in a halal way. We cover topics such as halal crypto investing, halal stock investing, and halal product reviews.
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Anything you hear in this video is an opinion. It is not personalized financial advice. Make sure you do your own due diligence before making any investment decisions.
@user-er3rs1pn9x 6 ай бұрын
Abdullah ibn Mas’ud reported: The Prophet, peace and blessings be upon him, said, “Allah has cursed the one who consumes usury, its client, its witness, and its recorder. Usury and adultery do not become widespread among people but that they will become vulnerable to the punishment of Allah Almighty.” Source: Musnad Aḥmad 3799 Grade: Sahih (authentic) according to Ahmad Shakir
@Ski880 Жыл бұрын
Very well explained and thank you for guiding so many people😊
@practicalislamicfinance Жыл бұрын
My pleasure
@OranJuno Жыл бұрын
Third type of loan: Quran 2:245 where Allaah SWT promises a many fold increase over the loan a believer gives to Allaah.
@practicalislamicfinance Жыл бұрын
Touché. Then again, this refers to charitable loans which is one of the two types I mentioned :)
@tundeganiyu3319 7 ай бұрын
@@dq8006it's halal if it's free from margin and leverage for nothing is given out for free from the brokers, some do that by unfair spread, I mean wide bid and ask price. Then, you should be able to withdraw the currency you are purchasing either to your wallet or else if you decide not to sell it back immediately. For instance, if your base currency is dollar then use it to purchase jpy then, your should be able to withdraw that jpy to your wallet (that has prevented the term with you just trading on speculation of price only). If it's spot on assets like BTC among other, you already know that, you can have the real value of the BTC in your wallet on purchasing and could even transfer it to alternative wallet (which are all permission) however, what is not acceptable is to initiate, "short selling" i.e sell order having not own the assest in the first place. As in, you can't sell what you do not own according to the prophet of Allah SWT If you don't understand the last part of short selling, please refer to the speaker page on KZfaq, explore his uploads, you will find the full explanation there in one of his post. If you still don't get it right, refer to me, I can give my Facebook or WhatsApp to explain better. May Allah SWT makes our sustainance halal for us.
@abcdefg98138 6 ай бұрын
@@dq8006ofcourse if the product is halal and you buying it on spot (which means you buy it from your own money) it's totally halal.
@AyaanKhan-nu9et 5 ай бұрын
Spot trading is halal
@help_me_start_trading 5 ай бұрын
i hope you will reply in binance if you just palce a trade it will cost some money and if you place a trade with leverage binance did not charge any other thing the same fees it will cost as it costs of without leverage
@shaheerbutt_ 5 ай бұрын
in future trading there is charitable loan but is it haram or halal?
@sj4695 Жыл бұрын
Can you do a video on prop firms please
@Awork44 4 ай бұрын
ماشاءاللّه❤
@rayyan4234 7 ай бұрын
Can u tell that on binance which type of trading are halal
@hkicgh7277 15 күн бұрын
Most Forex brokers do not benefit in any way shape or form from leveraged positions.
@shatha5366 8 ай бұрын
Is the funded account haram ?
@ZDL679 3 ай бұрын
Why about Salam transaction it’s kind of similar to stocks
@umairshaikh8048 4 ай бұрын
Only riba of delay is haraam. First if all leverage is not a loan , its a service, or u can say its like a deal with other person and share profits, that amount not come into your account or u cant do nothing it jist increase your postion size, see i have a lot to say , but it will ne too long. But if u taken a loan (traditional bank way) and oaued some extra nkw u say this whatever, its not riba. Many scholars including imam ibne humble (mau Allaah be pleased with him) said only riba of drlay js haraam. In quran also stated like "O u who beleives , do not consume ususry doubled or multipled and fear Allaah so you maybe succesful, what word doubled ir multipled it means charging extta fir dekay other then also u can say compounding. Charging fair and just ks not riba and not haraam alao. Bit here leverage its not even alona let alone riba. I can debate and also prove acc to my understanding ( with qutan and sunnah) that crypto perpeptual trading can be halal , very much possible. May Allaah guide all kf us Aameen.
@mazinr7185 3 ай бұрын
Where have u got riba of delay is haraam. All type of riba is haraam and its EXPLICITLY said in the quran. Ur either extremely ignorant or trying to justify this haraam act
@faisalhusein227 2 ай бұрын
Why is it not a loan ? We buy more than our money worth
@whoami72 8 күн бұрын
@@mazinr7185The clear explanation i know of riba is that riba is when you are given a loan of 1000 and you have to return 1100 after a certain amount of time
@Fstore-nv8cb 5 күн бұрын
@@faisalhusein227 is 1:1 halal?
@abrahamniyazov3586 6 ай бұрын
Sounds like copy and paste from the torah, but its allowed in some instances
@relaxnaturesounds5122 2 ай бұрын
What if it wasn't a loan , what if it considered debt without giving any commissions for them . İt's like I'm telling the broker to give me debt that equals an amount of money after that I'll give it back to him.
@user-mt6fk4ib4c Жыл бұрын
Therea are these token BTC5L,BTC3S, SHIB3L etc. (leveraged tokens). These show price changes 3or5 times of the asset . These are also similar to spot trading. Are these tokens HALAL ? as we are not borrowing any money like in the futures market. Pls need an answer
@danyalkayani916 Жыл бұрын
It is haram bc the only way to profit off of stuff like that is from the capital gains caused by other foolish investors. If you dump it and take a profit, then they’ll lose their value in the coin / stock. Also majority of those things are for the sole purpose of pump and dump so there fore it is gambling as well.
@kouparnpc 4 күн бұрын
Is meta trader 5 halal ? Please
@Nas33344 Жыл бұрын
Asalamu Alaykum, my brokerage just offered a new stock lending feature. I am wondering if you’d consider a video discussing if stock lending is considered shariah compliant.
@practicalislamicfinance Жыл бұрын
Sound bad I’d stay away
@ibnuhafizh5490 5 ай бұрын
Hey, I enjoy your content! I noticed a swap-free account in a forex broker, claiming it's for Muslims. Does having a swap-free account genuinely make leverage trading halal, or is it just a marketing gimmick?
@tundeganiyu3319 5 ай бұрын
Other prohibitions are involved as long it's Forex trading on future contracts. Spot trading trading is halal(as long leverage isn't involved) which are basically rare for currency trading.
@LuzdyOG Жыл бұрын
Side question. Is it possible to be a successful day trader with stocks on a cash account without a large sum without short selling as welll?
@swiftyy5354 Жыл бұрын
Good question,i'm on that side too...
@practicalislamicfinance Жыл бұрын
The real question is: is it possible to be a successful day trader? odds are, it is not.
@kbndz Жыл бұрын
Yes it is possible, make sure you dedicate sufficient time to studying charts and economics, and you'll be successful. Do not permit the limit beliefs of others to enslave you.
@alzahidsayed7980 Жыл бұрын
Same question here
@kbndz Жыл бұрын
@@alzahidsayed7980 I literally answered above
@rehmankhan6497 10 ай бұрын
Can u plzz make a video on crypto funding fees mechanism plzzzzz❤
@Fatima-rt9nx 2 ай бұрын
Future, options,margin,leverage all are haram except spot
@hkicgh7277 15 күн бұрын
@@Fatima-rt9nx And do not say when your tongues describe a lie: This is lawful and this is forbidden, that you may invent a lie against God. Indeed, those who invent a lie against God will not succeed. Quran 16, 116
@HustlerHubs 11 ай бұрын
i have a question please answer! If i take leverage and close trade before 8 hour ( because if u close trade before 8 hour you dont pay riba) and is future trading halal without leverage?
@kev0dev 11 ай бұрын
Is it riba? Is your opposite position a loan to someone else? There is a counterparty yes. But are you loaning them money? The funding rate balances the value of your contract to the spot market by paying the opposite party a fee because their asset is more fairly valued v spot. Just trying to understand since this does not seem like the same topic being discussed
@cryptotradingwithayan 11 ай бұрын
I also want to know that ...and i do the same
@HustlerHubs 11 ай бұрын
@@kev0dev so it is haram
@tundeganiyu3319 5 ай бұрын
Future trading is always haram for us. Don't be deceived because there would never be actual delivery of your currency if at all you need them. Simply it just means, you are only gambling about price
@zed801 2 ай бұрын
Is longing leverage halal
@mahamadshkor8599 Жыл бұрын
I don’t understand, now halal or haram if using 1:500 lavereg
@practicalislamicfinance Жыл бұрын
Rewatch
@kev0dev 11 ай бұрын
Salaam could you comment on the funding rate mechanism in crypto particularly perpetual futures contracts meant to mimic a spot market? My understanding is that buyers and sellers pay a fee over a predetermined period of time based on the actual difference in spot price v perpetual, which is settled in real time. Thank you.
@tundeganiyu3319 7 ай бұрын
simply what I know about future trading is that, no matter how they tune it to suit the narration of spot trading, the real deal is that, you can't withrawal the real BTC to either your wallet or for other purposes, so you are still just trading on price speculation which attracts the characteristics of gambling. Infact, in spot trading itself, we are forbidden to do short selling having not own the assest in the first place. Its haram to sell what you don't own according to the prophet of Allah SWT (meaning, you must own the assest in the first place before you can sell it back, anything other that, it just means you borrow the assets from the broker for reselling and that can never be free from the broker side
@hkicgh7277 15 күн бұрын
@@tundeganiyu3319So of selling is not free, you must know the fees incurred, please tell me what fee does broker charge for going short?
@hkicgh7277 15 күн бұрын
@@tundeganiyu3319Also, futures are contracts that are traded (who's value is similar to the spot value of the corresponding asset), it seems you have limited idea on what you are talking about and you are already throwing Halal and Haraam. Saying something is Halal or Haraam without knowledge is a very serious sin in Islam.
@rabiashah2221 Жыл бұрын
What do u think about inverse ETFs. Are they haram or halal?
@ibnuhafizh5490 6 ай бұрын
hi there, I'm currently still learning and try to find it out but there were some etfs that focuses on sharia compliance such as AMAGX, ISUS, SPUX, or SPSK
@Gangland.Tales0 Жыл бұрын
there are funding fees that are paid every 8hours (talking about crypto futures on bybit) so as long as you close trade before funding fee payouts then In my opinion you are not doing riba
@practicalislamicfinance Жыл бұрын
No
@sezerkuntasa6182 Жыл бұрын
@@practicalislamicfinance could you explain ?
@cryptotradingwithayan 11 ай бұрын
I also think the same...
@cryptotradingwithayan 11 ай бұрын
Can you answer this?????
@practicalislamicfinance 11 ай бұрын
@@cryptotradingwithayan I wasn’t going to answer but considering how many question marks you used I will … the broker is still benefitting through increased trades
@dartiajazaj7886 Ай бұрын
What broker gives out loans what are u talking about 😂 you open a broker account and you put your money in that account and you start trading with that money! What loan are you talking about!
@shams6522 10 ай бұрын
Hi sir Is it halal to put a buy limit and sell limit order in spot
@kinggaming355 9 ай бұрын
It's halal
@shams6522 9 ай бұрын
Thank you sir
@bilyaminsaniarab5512 2 ай бұрын
👍🏼
@mohammedshammi4407 Жыл бұрын
Bro please tell me intraday or option buying haram or halal
@practicalislamicfinance Жыл бұрын
See video on options
@Aviqu 6 ай бұрын
yeah and my great grandma had a unicorn
@mskyt04 10 ай бұрын
What about 1:1 leverage
@tundeganiyu3319 7 ай бұрын
Has long you are using your real money without any higher ratio to implicate borrowing as the term generally known as leverage the you are good to go...Note, future trading is haram while spot trading is not as long you can have the real value of what you are trading withrawable to your personal wallet. Instance, you can purchase BTC are withrawal to your wallet or other alternative wallet. What is haram in spot trading itself is short selling for we can't sell what we don't own in the first place (
@vanessavanessa9549 3 ай бұрын
@@tundeganiyu3319 so if i use leverage it's haram, margin also?
@muhammadhadi-bu3nz 7 ай бұрын
Is without Interest leverage are halal????
@3EAST 5 ай бұрын
All brokers have some sort of interest but I wouldn’t say this is rabi , more so uncle Sam tax!
@muhammadhadi-bu3nz 5 ай бұрын
@@3EAST JazakAllah brother but now I'm focused on crypto spot trading and it's halal 🌷
@mohammedsaad0761 11 ай бұрын
trading with 1x leverage is same as spot trading, is it halal ?
@shafiuadam164 10 ай бұрын
This is what am about to ask
@johnmarvel8729 8 ай бұрын
The thing is we still don’t have the asset even using 1x leverage. Speaking about risk-free of course yes.. as long as you buy you have no risk. When you sell or short selling you’ll get liquidated after 100% increase with 1x leverage. Still loan is a loan though.. especially when you sell or short. You borrow broker’s asset to be sold. Idk about buy or long. I’m actually trade futures anyway with full leverage 😅
@ZazoGaming 7 ай бұрын
Han mein bhi yehi sochta houn 1x halal lagta hai mujhe
@ZazoGaming 7 ай бұрын
Ab bankers bhi toh job kartay hain us mein interest hota hai aur woh job Haram hai
@abdirahmanhussein2983 4 ай бұрын
So how we can overcome this leverage? Is there a broker without leverage please?
@deltahunter2302 3 ай бұрын
Leverage Haram??🤔 leverage is not a loan.
@Breoke 2 ай бұрын
By using spot's
@pedro-jn5bd Жыл бұрын
Does trading with a funded account from a Forex prop firm halal or haram ? Please i need an answer 🙏 thank u
@LuzdyOG Жыл бұрын
Haram. Forex trading in its entirety is haram
@pedro-jn5bd Жыл бұрын
@@LuzdyOG what about stocks or crypto ?
@LuzdyOG Жыл бұрын
@@pedro-jn5bd can trade halal stocks on a cash account. Also, best to stay away from short selling when trading stocks as well. Crypto spot trading is halal as far I’m aware
@practicalislamicfinance Жыл бұрын
See my videos on forex.
@HabibBD24 4 ай бұрын
Brother. Would 1x leverage be haram?
@shakeib98 3 ай бұрын
Why would 1x be haram. 1x means you're using your own equity to execute the trade.
@muhammadtahir1425 Жыл бұрын
As salamu alaykum warahmatullah Mal if someone give me some money borrow for me to start business, after some time the didn't progress are saying am not going to paid him back his money because the business didn't progress
@kbndz Жыл бұрын
You owe him money, you better pay that back.
@abdulhanan656 Жыл бұрын
What about prop firms that funds you and you manage their money and profit is split between firms and trader and in case of loss, firm wll bear them. Is this halal?
@practicalislamicfinance Жыл бұрын
Different topic but since you asked, I don't see anything wrong with the arrangement you described so long as what you are trading in is halal.
@IsmailOmar3777 Жыл бұрын
bro i am sorry but can you tell me please are you trading futures with those funds mean on those money which they gave to you ??
@sugarnado8468 Жыл бұрын
@@practicalislamicfinance but all prop firms are cfd, so wouldn't it be haram
@practicalislamicfinance Жыл бұрын
@@sugarnado8468 I was commenting on the described arrangement, not cfds. Yes cfds are generally haram.
@imLAwhoareyou Жыл бұрын
@@sugarnado8468what does CFD mean?
@medicinedetails2800 3 ай бұрын
Binary / option trading / future trading halal or haram?? Please reply
@Breoke 2 ай бұрын
Leverage trading is the same as future trading
@medicinedetails2800 2 ай бұрын
@@Breoke haram or halal..?
@muhammadaliahamd8728 Жыл бұрын
Leverage trading in crypto is halal or haram??
@practicalislamicfinance Жыл бұрын
Same applies everywhere. Loans for benefit are haram.
@idreamblog5581 11 ай бұрын
1x leverage without getting loan halal or haram in binance futures trading
@idrisabubakar9540 9 ай бұрын
Why not buy on spot?
@idreamblog5581 9 ай бұрын
@@idrisabubakar9540 i can make money in market both ways but i need to know it's good or bad
@omarsherif5225 10 ай бұрын
it’s not a loan
@ZazoGaming 7 ай бұрын
Yeah I tell this KZfaqr it's not a loan bcz we use future trading with or usdt coin not take a loan with 1x leverage
@tundeganiyu3319 7 ай бұрын
@@ZazoGaming. Try to do more research, it doesn't end alone on 1:1 leverage, it has other conditions that makes it haram and unacceptable for us to deal with. One out of it is the condition that, except it's "spot" in future trading which mean you can withdraw what you purchased with your base currency like usdt to jpy, meaning, you should able to withdraw the real value of that jpy if you decide not sell it immediately but in future date or for other usage, if that condition can not be fulfilled then, it means you are just trading on price speculation with no added value to the currency you are trading on and in that regard, it already attracted the characteristics of gambling which makes it haram
@nawazsharifackbarally1128 8 ай бұрын
Is binance future trading halaaal or haram?
@wavaputra_ 5 ай бұрын
Haram
@junatanilhammansyah4135 11 ай бұрын
laverage in trading gold is halal or haram?
@ZazoGaming 7 ай бұрын
Bro leverage is Haram so you want to use 1x leverage
@ahmadhasan5298 5 ай бұрын
@@ZazoGaming how much you loss in Future trading. One Time that the gaming that you are playing lossing your time and other people time is also haram .
@memesserfully Жыл бұрын
what about swap free accounts?
@chwaiz5821 7 ай бұрын
I was also a paracticing forex trader I study forex from day to night for 1 year but according to some researches it probes leverage trading is haram even if it is swep free its just theor marketing strategy
@memesserfully 7 ай бұрын
can u please share with based on what you found out that it is Haram?@@chwaiz5821
@stondejohn 6 ай бұрын
@@chwaiz5821swap free accounts don’t have interest so how is it haram?
@user-om9fr9ku9d 4 ай бұрын
Internet is haram 😂😂
@Abdulazizqt 8 ай бұрын
أحقق أرباحًا ضخمة من استثماراتي منذ أن بدأت التداول مع علي حفيظ أيضًا ، واستراتيجياته من الدرجة الأولى..
@abdulla_bahlooq2176 8 ай бұрын
من المدهش رؤية الآخرين الذين يتاجرون مع حفيظ ، أنا في التجارة الرابعة معه وزادت محفظتي كبير.
@abdulla_bahlooq2176 8 ай бұрын
من المدهش رؤية الآخرين الذين يتاجرون مع حفيظ ، أنا في التجارة الرابعة معه وزادت محفظتي كبير.
@MalikSaim143 7 ай бұрын
Can you provide me his details pls
@hamzazaidan620 9 ай бұрын
Leverage is not lending money 🤦♂️
@practicalislamicfinance 9 ай бұрын
Oh please explain
@hamzazaidan620 9 ай бұрын
@@practicalislamicfinance a loan is something u take a give back, leverage is buying power For example banks trade with a standard lot size which is 100k most people don't have 100k so leverage allows them to enter trades with smaller sizes and therefore their profit and loss and less but without leverage not trades can be taken
@usmanshehumuhammad8528 9 ай бұрын
@@hamzazaidan620lol, u saying same thing he said but trying to dodge, its simply borrowing
@hamzazaidan620 9 ай бұрын
@@usmanshehumuhammad8528 it's not but ok
@Saxofaxo 10 ай бұрын
this is hilarious. ...problems of the post-modern muslim.... lol
@practicalislamicfinance 10 ай бұрын
Lol… What??
@hotrodgt66scarbuildsandmor46 10 ай бұрын
never use religion when making financial decisions
@practicalislamicfinance 10 ай бұрын
*always
@KhadijaAcademy 6 ай бұрын
Your rule is only for those who religion means nothing to them.
@Breoke 2 ай бұрын
Your life is just like your destination to somewhere and your religion is just like the "maps"
@johnadams3038 Ай бұрын
Religious nonsense has no place in science or economy 😂😂
@weirdcherrytasteyuck Жыл бұрын
are you alien?
@practicalislamicfinance Жыл бұрын
yes
@ardrone4443 Жыл бұрын
😂😂😂
@tejuss758 5 ай бұрын
Bullshit
@Jaoon_gameplay Жыл бұрын
I follow Islam but I don't think margin trading haram all interest not haram bcoz some interest issued by government which is halal and that's the main reason Muslim backward bcoz of its stupid teaching..they correlate 1000 years interest which was used for bad things in arab but now interest different broker issue interest on basis of GST so it's don't haram
@selo3236 11 ай бұрын
Follow the deen and not ur desires. Risq comes from Allah. Ur choose if u gain it in halal or haram
@prohacker4354 11 ай бұрын
@@selo3236 this whole world now even islamic countrys are built and funded by ribawi loans since years . the whole internationale economy system is based in credits and its something none can change . if a country want to improve. it cant do it by itself . it needs funds from another countries or organisations and for sure they wont give it for free . the reality nowadays its extremely different than before 1400 years ago . also lthe loan systeme now is way different than then in our prophet era so we cant say nothing
@selo3236 11 ай бұрын
@@prohacker4354 riba is haram. Doesnt matter how we name it. A muslim submits to Allah and his messenger.
@Jaoon_gameplay 11 ай бұрын
@@selo3236 it's not actually riba what you comparing riba means if you increase or decrease by your own desires for borrowing land or anything it's haram I know but if anybody not loan in poor country how he will survive think before say anything Allah or God knows very well he will not sin to person bcoz today housing loan is necessary for shelter it is based on banking system ...it's not haram..but everybody have different opinion..I am not poor I earn enough but teach Islam in right way don't teach in arrogant manner that makes no sense everybody know Islam good and follow ..
@Jaoon_gameplay 11 ай бұрын
@@selo3236 I think you are somewhat right as I will follow deen as you said I will not do margin trading and I will do normal trading bcoz when I earn from margin trading I don't feel good as I feel very sad or devilish ..so I am agree with you and my mindset has changed I will follow what you said ...I will not do margin trading but for housing loan I m not confirm it is completely haram or not....but I will do my maximum for following deen and Islam and try to be good for sake of Allah or God...