Is It Permissible to Buy and Sell Stock Options?

Answered by Shaykh Taha Abdul-Basser

Question: Assalamu Alaikum!  My friends and I have begun investing in stock options, specifically using the long straddle strategy (NOT short) and I wanted to make sure it was all Halal.  Here is a Wikipedia link describing it, the first part is about the long straddle: http://en.wikipedia.org/wiki/Straddle  Using this strategy we purchase both put and call options on a stock before a big event (earnings, major news) so we benefit whether the stock moves up or down.  Some of use are earning very high returns in what has so far been very low risk trades.  There is no interest involved as we are not shorting a stock or borrowing anything from our brokers.  Please let us the status of these investments in the Shariah.

Answer: Bismillahi r-rahmani r-rahim. Al-hamdu li-llahi rabbi l-`alamin.

Executing this strategy is not permissible because it consists of buying and selling stock options (both puts and calls), which are invalid (fasid) and impermissible transactions, according to the preponderant position of contemporary fuqaha’-specialists (AAOIFI SS 20:5.2.2 and 21:3.13). Buying and selling options are invalid and impermissible because option contracts 1) are exchange contracts (`uqud mu`awadah) that are marred by major indeterminateness (gharar fahish) and 2) resemble (or are) games of chance (qimar, maysir). (Abu Hurayrah: The Messenger (salla llahu `alayhi wa-sallam) prohibited pebble sales and indeterminate sales. (Bukhari 2783))

Wa s-salam
Taha Abdul-Basser

Shaykh Taha bin Hasan Abdul-Basser is a scholar of Islamic ethics and law who has acted as a shari`a compliance reviewer, examiner and consultant to investment funds, investment banks, retail banks, financial advisories, legal advisors and other for-profit and not-for-profit entities since 1998.  He is currently the Harvard Islamic Society Chaplain and a member of the Harvard Chaplains.

In addition to his father (with whom he began the study of standard Arabic as a child), he has studied the traditional Islamic disciplines with teachers from the Sudan, the Yemen, Tanzania and Bahrain. He has received traditional licenses (ijazat) in Islamic ethics and law, Prophetic traditions (hadith) and other disciplines from several teachers, including Shaykh Nizam Ya`quby.

Is It Permissible to Work As a Real Estate Agent or Broker?

Answered by Shaykh Taha Abdul-Basser

Question: Is it permissible for a Muslim to work as a real estate agent or broker?  I think the primary point of concern would be directing potential home buyers to banks and mortgage institutions.

Answer: Wa-`alaykum as-salam,

Yes, it is permitted for a Muslim to work as a real estate agent or as a real estate broker, since 1) selling and buying residential and commercial property per se are permissible activities and 2) acting as a real estate agent or broker essentially consists of facilitating–as a an agent (wakil) or employee (ajir)–such purchases. In general, facilitating the permissible is permissible.

However as the real estate market in the US is plagued with impermissible practices–many if not most transactions that are commonly executed in the market are impermissible or void (fasid)–it is necessary (wajib) that brokers and agents acquire and implement the fiqh that applies to their professional domain, so that they can avoid participating in the impermissible and restrict themselves to the permissible. The following are some relevant values (ahkam) and criteria (dawabit).

1. It is impermissible to direct the buyer to a bank, mortgage company or other financing entity so that the financing entity will advance them a usurious (ribawi) loan, as this would be facilitating a ribawi transaction, which is itself haram.

2. It is impermissible to facilitate the execution of any usurious (ribawi) financing by which the buyer purchases the home.

Wa llahu a`lam.

Wa s-salam
The neediest slave of Allah
Taha Abdul-Basser
Muharram 1432

Shaykh Taha bin Hasan Abdul-Basser is a scholar of Islamic ethics and law who has acted as a shari`a compliance reviewer, examiner and consultant to investment funds, investment banks, retail banks, financial advisories, legal advisors and other for-profit and not-for-profit entities since 1998.  He is currently the Harvard Islamic Society Chaplain and a member of the Harvard Chaplains.

In addition to his father (with whom he began the study of standard Arabic as a child), he has studied the traditional Islamic disciplines with teachers from the Sudan, the Yemen, Tanzania and Bahrain. He has received traditional licenses (ijazat) in Islamic ethics and law, Prophetic traditions (hadith) and other disciplines from several teachers, including Shaykh Nizam Ya`quby.

A Reader on Calling to Allah, Giving Advice, and Commanding the Good

Guiding One’s Family Towards the Good: Advice & Tips

Changing Those Around One: Attaching One’s Self to Allah & the Prophetic Sunna

Attracting the Youth to the Religion

Calling People of Other Beliefs to Islam

How Do I Motivate Someone to Perform the Good?

Guiding One’s Family Towards the Good: Advice & Tips

Changing Those Around One: Attaching One’s Self to Allah & the Prophetic Sunna

My Husband Doesnt Pray: How Do I Advise Him?

A Reader on Pornography and Masturbation

caution

My Computer is a Fitna for Me – Should I Get Rid of It?

Does Viewing Pornography Break One’s Fast?

My Fiance Discovered Some Objectionable Files on My Computer

Is Masturbation Sinful? How Do I Stop?

The Social Costs of Pornography

How Do Students With No Money Deal With Sexual Urges?

See also:

A Reader on Tawba (Repentance)

How Can I Strengthen My Iman When It Hits Rock Bottom?

Counsels & Wisdom on Uprightness & Spiritual Transformation

The Importance of Study in One’s Spiritual Development

If I Find a Hole in My Clothes That Exposes My ‘Awra (Nakedness) After Completing Prayer, Would I Have to Repeat the Prayer?

Answered by Shaykh Omar Qureshi

Question: Assalamu Alaikum,

I have a question concerning the clothing during prayer according to the Shafi’i School. If I find a hole in my sock, or perhaps anywhere on my garment, after completing salah, do I have to repeat that prayer?

Answer: Assalamu ‘alaikum.

InshaAllah all is well.

Case of Doubt

Shafi’i jurists state that if a person has a doubt regarding the performance of an integral or not fulfilling a condition (Covering one’s ‘awra is a condition of the prayer) of the prayer after one finishing the prayer, then the doubt doesn’t not affect the validity of the prayer. (‘Iyana Talibin, v. 1, pg. 208)

Case of Certainty

In the case where one is certain that after completing a prayer, one has not fulfilled a condition of the prayer, it would then be obligatory to repeat the prayer.

Keep in mind that covering the feet is required for women but not for men. So a hole in the sock during prayer for a woman would affect the prayer’s validity but not for a man.

If an upright individual (as defined by Hadith scholars) were to inform you that your ‘awra was exposed during prayer, you would be obligated to accept his/her report and repeat the prayer. (‘Iyana Talibin, v. 1, pg. 227)

Allah the Exalted knows.
Omar Qureshi

Shaykh Omar Qureshi completed his Bachelor’s degree at the University of Missouri – Columbia in Microbiology in 1995 and later obtained a M.Ed. in Science Education – Curriculum and Instruction from the same institution. As a teacher in Saudi Arabia, he also studied various Islamic Sciences with Sh. Salman Abu-Ghuddah. He continued his Islamic studies in Damascus, Syria at Ma’had al-Tahdhib wa-l-Ta’lim and privately with local Damascene scholars such as Sh. Hussain Darwish. Currently Omar serves as the Dean of Academics and Instruction at Islamic Foundation School located at Villa Park, Illinois. In addition to teaching, he is pursuing a Ph.D. in Philosophy of Education and Comparative Education at Loyola University in Chicago, where he is focusing on Muslim moral educational philosophy.

Should I Break Ties With My Friend Who I Fell in Love With?

Answered by Sidi Faraz A. Khan

Question: I’m a teenage girl and I have a guy friend of 2 years and I did fall in love with him without meaning to. We talked about marriage in the future but now we are just friends. I don’t have the same feelings for him ever since I turned towards Islam. I know it was wrong of me to become friends with him and to love him, but I’m really trying to become a better Muslim and I tried to end our friendship last year but I couldn’t. I am thinking about it again and I just want assurance that it’s the right thing to do.

Answer: Assalamu alaikum wa rahmatullah,

I pray this finds you in the best of health and faith.

Some Advice

Without a doubt, the right thing to do is to completely cut off all ties with him and end the friendship. This will be better for both of you, as adherence to the Sacred Law (shari’a) is the means for all blessing and success in any endeavor, especially marriage.

If he is interested in marrying you, have him go through his family and your family. This way, proper steps can be taken to ensure all etiquette and manners are upheld in the process.

In terms of your heart, turn it to Allah and the Messenger (peace and blessings be upon him). Right now is a special time, in which we commemorate his blessed birth and express our gratitude to Allah for sending him to us for our guidance and salvation. The Prophet Muhammad is the very best of creation, and he is the only means to draw near to Allah.

Read about the Prophet’s life, character, and special traits. Allah will fill your heart with love for him, and adherence to the Shari’a will become easy, to the extent that not adhering to it will become heavy and difficult.

The more we fill our hearts with love of the Prophet, the less room in our hearts for the haram.

May Allah continuously send blessings and peace upon him, his family and folk, and all followers until the Last Day. Amin.

Some Useful Links

For a detailed examination of the life and character of the Prophet Muhammad, I would highly recommend the book “Muhammad: His Life Based on the Earliest Sources” by Martin Lings.

“Muhammad: His Life Based on the Earliest Sources” by Martin Lings

And for a more summarized presentation of his exalted character, I would recommend the following article:

Why Is the Prophet’s Character Described as Being Tremendous? – Faraz Rabbani

And Allah alone gives success.

wassalam

Faraz A. Khan

Checked & Approved by Faraz Rabbani

Can Men Wear White Gold or Silk Ties?

Answered by Shaykh Faraz Rabbani

Question: I have a question regarding the permissibility of men (Shafii and Hanafi) wearing hite gold. This would be in regards to watches specifically. I have heard conflicting opinions, with a reference to tarnished gold being permissible (in Reliance of the Traveller). Could you provide clarification?

In addition, I would like to know if men (Shafii and Hanafi) can wear silk ties? Again, I have heard conflicting opinions, one of which indicates the width of the tie ascertains whether it can be worn.

Answer: In the Name of Allah, Most Gracious, Most Merciful

Walaikum assalam,

1. White gold. The only jewelry permissible for men is a silver ring. Rings of any other substance are not permitted, according to both the Hanafis and Shafi`is. [Mawsu`a Fiqhiyya, and Hashiyat Ibn Abidin]

2. If ties are from real silk (=that which is produced from the thread of silkworms), then they are not permitted. Now, while the Hanafi school permits a certain amount of silk in clothes, this is only if it is not entirely or overwhelmingly made from silk, such as silk piping or embroidery.

It is permitted without dislike to wear items of clothing in which there is less than 50% silk content. Entire items, such as silk ties, are not permitted. [Naf` al-Mufti wa’l Sa’il of Imam Abd al-Hayy al-Lakhnawi; Nahlawi, al-Hadhr wa’l Ibaha]

Wassalam,

Faraz Rabbani

Are First Cousin Marriages Permissible in Islam?

Answered by Ustadh Faraz A. Khan

Question: I’m looking for answer on first cousin marriage according to Quran and sunnah.  I love my cousin but her mother say first cousin marriage is not allowed in Islam.  According to her mother Allah warns us to beware of cousin marriage danger.  Please explain this for me.  Thanks.

Answer: Assalamu alaikum wa rahmatullah,

I pray this finds you in the best of health and faith.

The General Ruling

First-cousin marriage is completely fine and lawful according to the Qur’an and Sunna. There is scholarly consensus (ijma’) on its permissibility.

In Sura Nisa’ (4:22-24), Allah Most High lists all the categories of women that one cannot marry, which does not mention first cousins, and then says, “Lawful to you are all besides those mentioned.”

From the Noble Sunna, we know that our Beloved Messenger (peace and blessings be upon him) married his daughter Fatima to his first cousin Ali (Allah be well pleased with them both). And the Prophet himself (peace and blessings be upon him) married his first cousin Zaynab bint Jahsh (Allah be well pleased with her).

Your Particular Case

Having said that, the permissibility does not necessarily mean that such marriages are encouraged, especially when repeated over generations.

There are often health concerns if first cousin marriages continue over several generations. A physician should be consulted in particular cases. This answer sheds more light on the issue:

Lastly, I would strongly advise you to consult a pious scholar or counselor to help you deal with this situation, as there are other considerations that must be taken into account when dealing with such sensitive issues. A marriage with family approval more often than not is better in the long run, although there are always exceptions.

And Allah alone gives success.

wassalam

Faraz A. Khan

Checked & Approved by Faraz Rabbani

A Reader On Gender Interaction

gender-interaction

General Guidance

Guidelines for Interacting With the Opposite Sex

A Detailed Exposition of the Fiqh of Covering One’s Nakedness (awra)

Hadith About Seclusion (khalwa) and Unmarriageable Kin (mahram)

Breaking Family Relations Due To Adulterous Acts

Limits of Relationship between Males and Females

How Do We Bring About An Islamic Environment To Our MSA?

Lower Your Gaze – Shaykh AbdulKarim Yahya

Guidance for Men (Relevant for women also)

I Like a Girl: Controlling One’s Interactions & Feelings

Approaching a Potential Spouse

Guidance for Women
(Relevant for men also)

How Should I Interact With Non-Mahram (Marriageable) Males?

What do I do if I Develop Strong Feelings For a Brother I am Friends With?

Women, Unlawful Gazes, and Leaving the House

Women & the Workplace: Is it Impermissible for Me to Work Even If I Observe Proper Limits?

Love for a Non-Muslim Man & Inviting Him to Islam

Can a Hanafi Follow the Shafi’i Opinion on Joining Prayers When Traveling?

Answered by Shaykh Faraz Rabbani

Question: Scenario: Employers send one to a intense training program which is to run for three days (excluding the day one arrives and leaves), the training centre is beyond 50 miles. One finds it is difficult to pray on time and decides to follow the shafi madhab concerning joining prayers as a traveller.

a) Does one have to follow the shafi madhab in the rules of tahara, wudu and salat ?

b) Does one shorten prayers according to the shafi time limit of 3 days or does one stick to the hanafi time limit of 14 days?

Answer: Walaikum assalam,

In order for it to be permitted for one to take the dispensation of another school in any matter, one has to be reasonably sure, through sound means (such as learning from a scholar or reading from a text one is able to soundly understand) that your action is valid and proper in that other school, with all is preconditions.

When it comes to prayer, purification (tahara) is one of the preconditions for its validity. As such, both would have to be valid in another school for it to be legally valid for you to combine your prayers.

Mixing between madhhabs (talfiq) in a way that the action is not valid according to the position of any one of the maddhabs is invalid and impermissible. Ibn Hajar al-Haytami, Ibn Abidin, and others report scholarly consensus on this matter.

Pray each prayer within its time. Stay on wudu, wear footgear (khuffs), in order to be able to make wudu quickly, if necessary. If you cannot pray the sunnas, just pray the fard.

Keep in mind that this is the first thing we will be asked about on the Day of Judgment.

And Allah knows best, and He alone gives success.

Walaikum assalam,
Faraz Rabbani