Inquiry Regarding the Permissibility of Day Trading and Scalping in Islamic Finance
Dear Sheikh Sajib Umar
I hope this message finds you well.
I am writing to seek your esteemed guidance on a matter related to day trading and its compliance with Islamic finance principles.
I have been engaged in trading for several years, primarily focusing on technical analysis and short-term strategies such as scalping, often within very short time frames (like one-minute or five-minute charts). My trading is conducted through proprietary firms using demo accounts, so no personal capital is at risk.
My specific questions are:
Is such short-term trading, often referred to as scalping, considered permissible in Islamic finance?
Does the use of demo accounts in proprietary trading affect the permissibility of the practice?
I would greatly appreciate your insights on these questions to ensure that my trading activities are fully compliant with Sharia principles.
Thank you very much for your time and consideration. I look forward to your guidance.
Warm regards,
Walid Sultani
An Islamic ruling on day trading and scalping, examining short-term trading strategies, ownership and risk, and the use of proprietary firms and demo accounts i...