Forex Trading: Definition, Method and Rule in Islam

One way to get income besides working and doing business is by investing. In Islam, there is one more variable that will be able to produce wealth, which is alms.

However, what will be discussed in this article is related to investment. The investment order was taught by Umar bin Khattab.

That is when Umar asked the workers not to spend all of his salary, but buy some for the goats. There is more salary, buy some for the goat. Etc.

The investment world now has a lot of variety. Maybe you are already familiar when you hear the word stock trading. Well, today there is a new way of trading, namely forex trading.

Also Read: Stock Investment Guide for Beginners

Understanding Forex Trading

Let’s discuss about forex trading starting from the understanding. Trading as the translation in Indonesian is trading.

The forex is a continuation of foreign exchange . From his understanding, it can be understood that this investment is closely related to foreign currencies.

So when connected, forex trading is a type of investment that relies on speculation about exchange rates or the price of international currencies.

Similar to investment or stock trading , in forex trading an investor can also make predictions related to currency price fluctuations.

How to trade Forex

The way to benefit from trading this one is actually simple. That is buying a currency when the value is low and selling it when the value of money is high.

So, how to play like this is common in every type of investment. Including stock trading . If you play stocks, surely one way to get capital gains is to buy shares at low prices and sell them when prices go up. It is not like that?

Then from a more technical point of view when you want to try playing these investments, you are advised to practice through a demo account.

After you have matured in the training, then you can meet a broker who sells forex trading. When meeting a broker and feels right with the broker, you can start registration / open an account with the broker.

After that, you need to deposit your money and finally you can immediately start competing.

Also Read: Difference in Mudharabah, Murabahah and Musyarakah Agreements

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The law of buying and selling currencies in Islam

Buying and selling currencies in Islam has an absolute requirement that must be met so that the sale and purchase of these is justified in sharia.

One condition for the sale and purchase of currencies in Islam to be legitimate is that the sale and purchase must be carried out in cash. If the currency is a kind of currency such as rupiah and rupiah, then it must be the same value.

Say, you want to exchange IDR 100,000 with IDR 5,000 then you need to get IDR 5,000 for 20 pieces so that it is worth IDR 100,000.

Yes, buying and selling currencies must be done in cash and on location. If someone postpones their purchases until an undetermined time there will be an element of usury nasi’ah in it.

As the Prophet said,

الذَّهَبُ بِالذَّهَبِ وَالْفِضَّةُ بِالْفِضَّةِ وَالْبُرُّ بِالْبُرِّ وَالشَّعِيرُ بِالشَّعِيرِ وَالتمِْلِْْثْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْْ informationِِْْْْْْْْْْْْْْْْْْْْْ

بِسَوَاءٍ يَدًا بِيَدٍ فَإِذَا اخْتَلَفَتْ هَذِهِ الأَصْنَافُ فَبِيعُوا كَيْفَ شِئْتُمْ إِذَا كَانَ يَدٍاب

That is,

” If gold is sold with gold, silver is sold with silver, wheat is sold with wheat, sya’ir (a type of wheat) is sold with sya’ir, dates are sold with dates, and salt is sold with salt, then the amount (dosage or scales) must be the same and paid in cash (in cash). If the type of item was different, then please you barter as you wish, but must be done in cash (cash). “(HR. Muslim no. 1587)

Also Read: A Complete Guide to 2020 Investment for Beginners

Forex Trading Law

Although there are opinions that allow forex trading , but the majority of scholars argue that forex trading is haraam.

The acquisition of forex trading is based on the opinion that in forex trading there is no element of deception, hiding the defective and speculative. This opinion measures the general terms of sale and purchase.

Called not speculative, in his opinion is because the price of a currency can be predicted as the price of a stock. So it’s not a price guess.

However, a stronger opinion is haram. Because forex trading has violated the conditions of currency buying and selling in Islam, namely cash.

In forex trading , currency exchange is not done directly in cash. So that forex trading when referring to the opinion of the majority of scholars becomes haram.

Conclusion

Thus the explanation of forex trading starting from the understanding, procedures to the law in Islam. Hopefully this article can add insight to you and the most important thing is getting closer to Allah SWT

 

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