What is the ruling of dealing with shares in businesses? By Shaikh Al-Fawzān

Question:

What is the ruling of dealings with shares whilst knowing that a person does not know whether he will benefit or lose?90_header_shares

Answer:

Shares in companies or businesses that are known for halāl (permissible) transactions, who do not deal in usury and interest – and their dealings are known and regulated, then there is no harm in that. As for dealing [i.e. buying shares] with those companies whose trade is unknown or those which take interest-based loans for their enterprises or they finance their projects with interest-based loans, or they leave their funds in a bank gaining [interest] – it is not permitted to take shares in these companies nor to enter [into investments with them]. The same goes for shares in those companies that you do not know in what they do business. So it is a condition that the company whom you deal with [by investing with them] in buying and selling, that you know it, encompass and understand it, and it cannot be something unknown to you.

(Tawjihāt Muhimmah ilā Shabāb il-Ummah of Shaikh Al-Fawzān, p. 27-28 (Dārul-Mirāthin-Nabawee), slightly abridged.)

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