Is leverage or margin trading halal?

--------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------
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.

--------------------------------------------------------------------
SUBSCRIBE IF YOU WANT TO BUILD HALAL WEALTH!
╔═╦╗╔╦╗╔═╦═╦╦╦╦╗╔═╗
║╚╣║║║╚╣╚╣╔╣╔╣║╚╣═╣
╠╗║╚╝║║╠╗║╚╣║║║║║═╣
╚═╩══╩═╩═╩═╩╝╚╩═╩═╝
--------------------------------------------------------------------

CHECK OUT OUR OTHER VIDEOS

CONTACT US

ABOUT OUR CHANNEL
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.

DISCLAIMER
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.

[Asthics-kr]

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

[OranJuno]

Third type of loan: Quran 2:245 where Allaah SWT promises a many fold increase over the loan a believer gives to Allaah.

[Ski]

Very well explained and thank you for guiding so many people😊

[dartiajazaj]

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!

[moawizmalik]

Is the leverage given by trading broker can be consider as ribawi loan

[Maakhiri]

Are Leveraged ETFs included in this? Thanks bro

[umairshaikh]

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.

[LuzdyOG]

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?

[hkicgh]

Most Forex brokers do not benefit in any way shape or form from leveraged positions.

[memooz]

But Bitget doesn‘t charge interest if doing Futures Trading, there is no Riba involved I dont understand

[RayidAfzal]

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

[Gangland.Tales]

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

[Hustler_Wealth]

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?

[abrasha]

Sounds like copy and paste from the torah, but its allowed in some instances

[kevdev]

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.

[asiandudereact]

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?

[ZDL]

Why about Salam transaction it’s kind of similar to stocks

[rehmankhan]

Can u plzz make a video on crypto funding fees mechanism

[unknownidentty]

What if there is no interest involved?

[relaxnaturesounds]

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.