Investing in Shares and Day Trading

Investing in Shares and Day Trading

Question:

Assalumalikum hope you are well i have two question regardinf stock shares.

1) Am i allowed to invest into shares like soical media platforms such as facebook and instagram and selling platforms such as ebay and amazon. On socal media stocks such as facebook make money on advertsiment so if you to sell your service or products you can use facebook and other socal websites and pay them for advertisments. Now here is the confusion. On the socal app like facebook you can advertise halal stuff like if you selling phones or clothes and also people can sell haram stuff like alcohol and betting app however facebook will not own these stocks or service they just advertise what people want to sell. So will this will be a hala investment? On selling platforms such as ebay and amazon people can sell products which are halal also haram so would this be a hala investment?

2) Am i allowed to daytrade stocks. So for example i buy a stock at 10am at £50. I use techincal analysis and watch the charts to predict if the stock will go up or down (we dont know if it will go up or down) i use indicators such as simple moving averages and support and resistance on the candlestick charts to predict it now 3 mins later the stock has gone up £5 and i sell and i am happy with profit could i do this and is it allowed. Some people say this is speculation and haram but im not sure how because i use techincal analysis.so can i day trade like this?

Thanks for your time may Allah reward you

Answer:

In the name of Allah, Most Compassionate, Most Merciful,

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

1)  The DarulIftaa has written a detailed answer regarding screening of shares in order to determine whatcompanies are lawful to invest in. You may refer to the articleon: http://askimam.org/public/question_detail/46129

2) Day trading is not permissible as one is not in possession of the stocks before re-selling them.

See the following narration:

عن عبد الله بن عمرو: …نهى رسولُ اللهِ عن بيعِ ما لَمْ يُقبَضْ…. (الطبراني (ت ٣٦٠)، المعجم الأوسط ٢‏/١٥٤)

Translation: Abdulla bin Umar (RadiyAllahuAnhu) narrates: Nabi (SallalahuAlayhiWassallam) prohibited the sale of an Item before its possession.” (Tabrani:36)

You may refer to the following detailed Fatwa regarding the impermissibility of day trading:

http://www.askimam.org/public/question_detail/41513

And Allah Ta’āla Knows Best

Hammad Ibn Ismail Jogiat

Student - Darul Iftaa

Cambridge, Ontario, Canada

Checked and Approved by,

Mufti Ebrahim Desai.

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