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Options stock trading

Answered as per Hanafi Fiqh by ShariahBoard.org

Assalamu alakum I was wondering if trading stock options is permissible. If you are experienced and and know what you are doing is it halal?

الجواب وباللہ التوفیق

In trading practice, shares are sold without taking their possession. In addition, this kind of trade, involves interest and gambling. It is therefore not allowed.  

عن ابن عباس رضي اللہ عنہ قال: قال رسول اللہ صلی اللہ علیہ وسلم: من ابتاع طعاماً فلا یبعہ حتی یقبضہ۔(صحیح بخاری ،کتاب البیوع ،۲۱۳۳)قال ابن عباس: وأحسب کل شيء بمنزلۃ الطعام۔ (صحیح مسلم ۲؍۵)

عن عَبْدَ اللَّهِ بْنَ عَمْرٍو أَنَّ رَسُولَ اللَّهِ صَلَّى اللَّهُ عَلَيْهِ وَسَلَّمَ قَالَ: «لَا يَحِلُّ سَلَفٌ وَبَيْعٌ، وَلَا شَرْطَانِ فِي بَيْعٍ، وَلَا رِبْحُ مَا لَمْ يُضْمَنْ، وَلَا بَيْعُ مَا لَيْسَ عِنْدَكَ» : وَهَذَا حَدِيثٌ حَسَنٌ صَحِيحٌ(سنن ترمذی : ۱۲۳۴)

Hazrat Abdullah Bin Amr (RA) narrated that the “Messenger of Allah (SAW) said: ‘It is not lawful to lend and sell, nor two conditions in a sale, nor to profit from what is not possessed, nor to sell what one does not have’”. 

:’’کُلُّ قَرْضٍ جَرَّ نَفْعا ًفَہُوَ رِبَا‘‘(جو قرض نفع لائے وہ سود ہے ۔(مصنف ابن ابی شیبۃ : ۲۰۶۹۰)

فقط واللہ اعلم بالصواب

This answer was collected from Shariahboard.org. It was established under the supervision of the eminent faqih of our era, Hazrat Shah Mufti Mohammed Navalur Rahman damat barakatuhum.

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