Fatwa #398898 July 2019United States of America
Investing in stock market
Question
Assalam alaikum wrwb. This is second time I am writing for the same question. I have asked about the stock market that whether or not if it is ok for one to buy shares in following companies: aapl(Apple technology), MU(micron technology), nvda(nvidia chipmaker), X (US Steel. )?
Answer
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
We apologize for the belated response. There are differences of opinion regarding the permissibility of investing in stocks. Mufti Taqi Sahib (دامت بركاته) permits investing in stocks with the following conditions[1];
- The company has some illiquid assets such as buildings, machinery, inventory of goods, etc. If a company has only liquid assets, then its shares may only be sold and purchased at face value.
- The main business of the company is lawful.
- The shareholder should voice his disapproval of the company's dealings in interest which is ideally done at the annual general meeting (AGM). This is because many companies in spite of their main business being lawful usually take out interest based loans or keep a portion of their funds in interest bearing accounts.
- The proportion of the stock dividend (if any) that represents the company's earnings from interest should be given in sadaqah without any intention of reward.
If the above requirements are met, you may invest in the companies referenced.
And Allah Ta’āla Knows Best
Saad Haque
Student Darul Iftaa
New Jersey, USA
Checked and Approved by,
Mufti Ebrahim Desai
References
- اسلام اور جديد معيشته وتجارت ص١٠٤ – مكتبة معارف القران (شیرز کی بیع وشراء کی شرائط)