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In the Name of God بسم الله

Working for a CFD and FOREX spread betting company

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NAR

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SA

Is it permissible to work for a brokerage firm that provides platform for trading CFD and FOREX by way of spread betting?

The role entails building and delivering trading software by using various software tools but does not actually involve writing the software for the products. Examples: [Mod Note: Links removed]

CFDs are leveraged financial instruments (derivatives) where you speculate on the short or long price movement of shares, commodities, foreign currencies etc without actually ever owning the underlying assets. As such, large gains can be realized, and conversely, losses can also be greatly amplified beyond the original investment you make when opening a position. I have the following concerns:

  1. The trades are purely speculative in nature and you do not own the underlying assets - unlike buying real shares where you are afforded voting rights and potential income from dividends.
  2. You can place a long or short bet on a position. I believe shorting is not permissible even when trading real company shares.
  3. The products are margin based which, in part, can contribute to the magnified losses. This is problematic in my opinion as you are putting yourself in financial danger if the trade moves against you.

In my personal opinion the services provided by aforementioned companies are akin to (or at least encouraging) gambling/betting. I might have a misguided view on this so any opinion or scholarly advice based on Agha Sistani's rulings will be immensely welcomed.

WS

Edited by Hameedeh
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Salam. You are indeed correct that Forex trading is not permissible. See this post in another thread:

https://www.shiachat.com/forum/topic/235042512-important-questions-answered/?do=findComment&comment=3129681

Members who post their email address or link to their own Forex site have been banned.

On 7/21/2011 at 6:49 AM, Gypsy said:

Refrain from posting a non-Islamic self-promotion materials (including ads) in the future. Please read the following rules and regulations carefully

Non-Islamic Advertisements, chain letters, pyramid schemes, and solicitations are inappropriate on this site and considered spam. Anyone found doing this will be banned immediately. You're free to advertise your Islamic site to a certain extent however.

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Sincere apologies for posting the links but the topic is in no way a self promotion. This a genuine question which I am affected by. I added the links simply as references for the readership.

If it is anything other than the links that is problematic then please do let me know for future reference.

WS

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8 hours ago, NAR said:

Sincere apologies for posting the links but the topic is in no way a self promotion. This a genuine question which I am affected by. I added the links simply as references for the readership.

If it is anything other than the links that is problematic then please do let me know for future reference.

WS

No problem, the links were removed. It was clear from your post that you are of the opinion that Forex trading is gambling. You wanted to discuss it, not promote it. :) 

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