Islam on investing and shares

[AliMohammed]

Peace be with you.

I've never really understood the business and economy behind investing. Could someone with (advanced) knowledge or rather experience about this, explain it to me?

What does the sharia' say about investing in companies and having shares etc. 

What do the maraji' say?

Is this something that is halal or haram?

Jazakallah khair.

 

(I have heard incoherent answers that's why i'm hoping someone would clarify this)

[Hassan-]

It's halal as long as you aren't investing in companies that make their income through haram means (e.g weed, alcohol, etc.)

[Gaius I. Caesar]

@Hassan-.

What about investing in currency? Is it haram? I thought about it but I don't want to do it if haram.

Edited July 17, 2017 by Gaius I. Caesar

[Hassan-]

11 minutes ago, Gaius I. Caesar said:

@Hassan-.

What about investing in currency? Is it haram? I thought about it but I don't want to do it if haram.

I believe investing in currency is almost the same as investing with shares, so the ruling shouldn't change.

[Mohamed1993]

I think investing in bonds and similar fixed-income securities is haram, because it involves interest. 

[haidermpr]

Investment is companies that are not in Haram businesses are legitimate and your earnings are halal. 

there are certain companies which are involved in haram as well as haram businesses at the same time, if you are going to invest in any of those companies, care must be taken that your investment is in halal business if you can't take care of that things you should abstain yourself from investing in such companies. 

 

[Meesum_Mtl]

18 hours ago, Hassan- said:

It's halal as long as you aren't investing in companies that make their income through haram means (e.g weed, alcohol, etc.)

I think the issue can get a little more complicated than that. Are you aware of any ruling that indicates what to do if the company you invest in diversifies it's income and then becomes haram? Personally, I think that a lot more research has to be done in this field by our scholars or if the research has been done to at least define most possible scenarios.

 For example, let's say I invested in XYZ a perfectly halal company. XYZ, two years from now, decides to buy stock in ABC a Haram company. This would mean that a portion of XYZ's income becomes haram thus meaning the stock you invested in becomes haram? Or what if XYZ decides to issue bonds or decides to issue another company a loan?

Another problem, would be, given the scenario above, if my securities do in fact become haram, what happens to the investment? Do I sell it? If I do sell it and it's at a gain, is that gain Halal for me?

Lastly, assume the following. I have purchased Halal XYZ stock that pays no dividend. XYZ invests in haram. Can I hold the stock with the expectation that XYZ will divest from the haram stock in the future?

Edited July 17, 2017 by Meesum_Mtl
Added Final Paragraph

[Hassan-]

1 hour ago, Meesum_Mtl said:

I think the issue can get a little more complicated than that. Are you aware of any ruling that indicates what to do if the company you invest in diversifies it's income and then becomes haram? Personally, I think that a lot more research has to be done in this field by our scholars or if the research has been done to at least define most possible scenarios.

 For example, let's say I invested in XYZ a perfectly halal company. XYZ, two years from now, decides to buy stock in ABC a Haram company. This would mean that a portion of XYZ's income becomes haram thus meaning the stock you invested in becomes haram? Or what if XYZ decides to issue bonds or decides to issue another company a loan?

Another problem, would be, given the scenario above, if my securities do in fact become haram, what happens to the investment? Do I sell it? If I do sell it and it's at a gain, is that gain Halal for me?

Lastly, assume the following. I have purchased Halal XYZ stock that pays no dividend. XYZ invests in haram. Can I hold the stock with the expectation that XYZ will divest from the haram stock in the future?

What you say is very possible, and that's why I gave a very general answer by saying it's halal if the company doesn't get involved with haram means. The person must do his research of course and be certain the company is halal. But generally speaking it's halal. 

I don't know the answers to your questions to be honest, your right it could get very complicated but if the company is doing something haram behind your back without your knowledge, your investment remains permissible until you find out the company your investing in is doing haram, than it becomes impermissible to invest in it.

[Meesum_Mtl]

9 minutes ago, Hassan- said:

I don't know the answers to your questions to be honest, your right it could get very complicated but if the company is doing something haram behind your back without your knowledge, your investment remains permissible until you find out the company your investing in is doing haram, than it becomes impermissible to invest in it.

Yeah that's understandable, problem is that if you're investing in stock and are not willing to take a gamble (if you are considered anything other than a "naive investor" then you will go through the financial statements with a fine comb. By doing so, you would discover most of what I have mentioned (it's hard for a public company to hide it's investment and it's income sources). Unfortunately, I haven't been able to find an expert in the subject either.

[Ashvazdanghe]