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I am willing to invest money with a company called star capital finance Ltd. which basically does the following: The company is based in New Zealand. The investor (myself) creates an account and debits an amount of money to invest with (for example $10000), the company invests these funds in daily transactions and gives back the profits on daily basis in my account. There is no guaranteed amount for profit or loss (this is variable hence the funds are added to my account after each transaction (daily) and I can withdraw my funds totally anytime with no restrictions. The company uses the funds to invest in 3 categories: (1) Gold. (2) Real Estate. (3) Foreign Exchange. Is participating in this Shariah compliant or not?

Answered according to Hanafi Fiqh by Darulifta-Deoband.com

I am willing to invest money with a company called star capital finance Ltd. which basically does the following:
The company is based in New Zealand. The investor (myself) creates an account and debits an amount of money to invest with (for example $10000), the company invests these funds in daily transactions and gives back the profits on daily basis in my account. There is no guaranteed amount for profit or loss (this is variable hence the funds are added to my account after each transaction (daily) and I can withdraw my funds totally anytime with no restrictions. The company uses the funds to invest in 3 categories: (1) Gold. (2) Real Estate. (3) Foreign Exchange.
Is participating in this Shariah compliant or not?

Answer

(Fatwa: 373/274/D=1434)

You wrote where the company invests but you did not write what is the method of its business? In the case when company gives you profit on daily basis, if it is the method of network marketing then it is not lawful as the business item is sold ahead without taking it into possession which is not lawful as per hadith. Rather sometime there is no existence of business item and only verbal sale takes place and profit and loss is also done which is not lawful. Hence it is not lawful to invest in it. If the method of the company is something else then you should write it in detail.

Allah (Subhana Wa Ta’ala) knows Best

Darul Ifta,
Darul Uloom Deoband

This answer was collected from the official ifta website of Darul Uloom Deoband in India.

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