I urgently need advice on whether trading is permissible or not. I have already started cryptocurrency trading (however I haven’t taken out any money yet) and in the future I would like to pursue stocks and forex as well. However, I need to know that I am taking a 100% halal route. I’m really avid about trading and wanted to make this my future, so I want to be certain that it is halal.
Some scholars say that trading is haram due to certain haram elements, however they mention things that we can usually avoid. For example:
1. I will not under any circumstance be trading without using strategy and doing research and analysis. Therefore, I will actually be earning my money rather than just trading without thought, as this counts as gambling. So I am avoiding the ‘gambling element’.
2. The platform I currently use for cryptocurrency trading does not involve any interest, only a small fee when I deposit money. Even if there was interest, I would ensure that I donate all of this to charity.
3. I will research companies before I invest into their stocks or buy their cryptocurrencies, to make sure that the companies do not engage in haram activities. I have some websites and apps that I can use for this.
4. I will only start forex trading in the future if I have enough money inshallah that I will not need to use leverage, as this is essentially trading with money that I do not own.
5. For cryptocurrency trading, I will make sure to trade only with cryptocurrencies that actually have a future and will be used for real transactions.
In conclusion, I am confident that I can avoid all haram elements when trading, such as interest, gambling etc.
Please let me know if there are any other measures I have to take to make it a completely halal method of making money, or if there are certain types of trading I have to avoid eg. if I can trade stocks and crypto but not forex. Or, thirdly, if trading is haram in general even when interest and gambling is avoided.
The response below details the various facets of this question. Avoiding interest, gambling, CFDs, leveraging, short-selling and so forth are essential as these are not permitted in Sharia. However, there are more fundamental questions that relate to trading in general, and the financial instruments and strategies you are hoping to utilise.
Trading crypto currencies
While some scholars have ruled for the permissibility of buying and selling cryptocurrency, our institution has reserved judgement until we conduct further investigation and research. This research is currently ongoing.
FX trading is not permissible.
The exchange of currencies (bay‘ al-sarf) is a topic thoroughly discussed in the classical manuals of Islamic law. Herein, it is stipulated that the possession of both counter-values must take place within the setting of the transaction. The possession must take place before the two parties depart; otherwise, the transaction is unlawful and impermissible. 
The most immediate form of FX currency sales, spot sales, come with a delivery period of two business days (T+2) – thus failing to meet this most fundamental condition.
Moreover, according to Mufti Faraz Adam, these currencies are never delivered in the first place as traders close their open and re-open their positions at the end and start of the new trading day. Thus, issues of gross uncertainty (gharar), gambling (qimar) and other non-compliant practices are involved. In fact, looking closer at how FX brokerages act, there are a plethora of pressing sharia-compliant issues, see: https://darulfiqh.com/knowledgebase/is-retail-forex-trading-shariah-compliant/
Investing in Shari’a compliant stocks is permissible. In trading – be that day or swing trading – the discussion of T+2 becomes relevant again. As per industry standard, it takes two business days for the broker to take ownership of the shares on your behalf. Before this point, one does not own the shares, and it is therefore impermissible for them to sell those shares before they own them.
Day-trading is problematic as it would involve selling one’s shares before its delivery, while your swing will likely take place after two business days. Therefore, swing trading has greater scope for permissibility so long as the stock is halal and one sells following delivery of the stock.
Spirituality and the world of trading
While the fiqh of your question has been answered, a more pressing matter is the spirituality of the world of trading.
Firstly, and I say this as someone who has former acquaintances that are professional institutional traders, trading is a challenging profession. 80% of all retail and casual investors lose their money in trading. To be a successful trader, the news cycle and market analysis need to dominate your life. Your edge as a trader is your analysis, the algorithms you employ and your knowledge of the markets and news cycle. A trader’s thoughts are almost always looking at the markets and news. One will need elite emotional control and laser focus.
Even if you feel that you are avoiding all the haram aspects of the job, trading can be very spiritually damaging for one’s mind is in constant flux about the markets, the news, their positions and so on. Allah (swt) said to us in Surah Takathur: “competition for more gains diverts you from Allah until you end up in your graves” (Q. 102:1-2).
While trading can be an exciting career, it is highly invasive. While one may have a great work-life balance, one realises that they struggle to find the “off” button. This is not our purpose in life; we have been instructed to remember and worship Allah. In this world of trading, you may find that all you have time for is the thought and pursuit of the markets.
Moreover, trading is not what you see on social media. It is very easy to be hoodwinked by people on social media who flaunt their wealth, accredited to their “trading”. It is more than likely that these personalities earn their wealth from teaching and subscriptions – not from trading. Everything else is just a stunt. In actuality, a career in trading is fraught with impediments. One will have to lose a lot of money to fully understand the markets and dedicate themselves to their craft.
If one has nothing but the markets, P/Ls and the news in their mind, one wonders: has the pursuit of material wealth distracted them from their real purpose in life?
 الهداية في شرح بداية المبتدي» (3/ 81): ولا بد من قبض العوضين قبل الافتراق” لما روينا، ولقول عمر رضي الله عنه: وإن استنظرك أن يدخل بيته فلا تنظره، ولأنه لا بد من قبض أحدهما ليخرج العقد عن الكالئ بالكالئ ثم لا بد من قبض الآخر تحقيقا للمساواة فلا يتحقق الربا، ولأن أحدهما ليس بأولى من الآخر فوجب قبضهما سواء كانا يتعينان كالمصوغ أو لا يتعينان كالمضروب أو يتعين أحدهما ولا يتعين الآخر لإطلاق ما روينا، ولأنه إن كان يتعين ففيه شبهة عدم التعيين لكونه ثمنا خلقة فيشترط قبضه اعتبارا للشبهة في الربا، والمراد منه الافتراق بالأبدان،»
«فتح القدير للكمال ابن الهمام وتكملته ط الحلبي» (7/ 135): (قَوْلُهُ وَلَا بُدَّ مِنْ قَبْضِ الْعِوَضَيْنِ قَبْلَ الِافْتِرَاقِ) بِإِجْمَاعِ الْفُقَهَاءِ. وَفِي فَوَائِدِ الْقُدُورِيِّ: الْمُرَادُ بِالْقَبْضِ هُنَا الْقَبْضُ بِالْبَرَاجِمِ لَا بِالتَّخْلِيَةِ يُرِيدُ بِالْيَدِ، وَذَكَرْنَا آنِفًا أَنَّ الْمُخْتَارَ أَنَّ هَذَا الْقَبْضَ شَرْطُ الْبَقَاءِ عَلَى الصِّحَّةِ لَا شَرْطُ ابْتِدَاءِ الصِّحَّةِ لِظَاهِرِ قَوْلِهِ: فَإِذَا افْتَرَقَا بَطَلَ الْعَقْدُ، وَإِنَّمَا يَبْطُلُ بَعْدَ وُجُودِهِ وَهُوَ الْأَصَحُّ. وَثَمَرَةُ الْخِلَافِ فِيمَا إذَا ظَهَرَ الْفَسَادُ فِيمَا هُوَ صَرْفٌ يَفْسُدُ فِيمَا لَيْسَ صَرْفًا عِنْدَ أَبِي حَنِيفَةَ – رَحِمَهُ اللَّهُ -، وَلَا يَفْسُدُ عَلَى الْقَوْلِ الْأَصَحِّ، وَقَوْلُهُ
 Mufti Taqi ‘Uthmani makes three compelling arguments as to why possession of the shares takes place at delivery (two or three business days), not at the time of purchase. See: Fiqh al-Buyu, 1:386-9. Therefore, selling the shares before possession is impermissible also, 1:385.
Maulana Ikramul Hoque Miah
Checked & Approved by:
Mufti Abdul Rahman Mangera
Mufti Zubair Patel