Topic:
Earning Money Through the FTMO Proprietary Trading Firm
(No-58399)
Assalamu alaikum wa rahmatullahi wa barakatuh, Sheikh.
I would like your guidance regarding a proprietary trading firm called FTMO. My understanding is that I would pay a fee to take an evaluation. If I pass, I receive access to a funded trading account. The capital belongs to the firm, and I receive a percentage of any profits I make, while the firm bears the trading capital risk within the agreed rules. If I pass, I receive access to a simulated funded trading account, and this fee is typically refunded to me on my first payout
I am specifically asking about their swap-free (Islamic) account, where overnight interest (swap) is not charged and trades are executed via Contracts for Difference (CFDs).
I plan to use strict risk management, risking only about 1% per trade, and I will trade according to a defined strategy rather than gambling or guessing.
The instruments I intend to trade include forex, gold (XAU/USD), and stock indices.
Could you please advise me on the following:
1. Is participating in FTMO’s swap-free funded account halal?
2. Does paying the evaluation fee affect the ruling?
3. Is trading CFDs through a prop firm permissible if the account is swap-free?
4. Which markets, if any, would be permissible to trade? For example:
* Forex currency pairs
* Gold and silver
* Stock indices (specifically major ones like US30 / Dow Jones and US100 / Nasdaq)
* Individual shares
* Commodities
* Cryptocurrencies
5. Are there any conditions I should follow to ensure my trading remains halal?
6. If some instruments are permissible and others are not, could you explain the differences?
JazakAllahu khayran for your time and guidance.
1–6) In the situation asked about, trading through the FTMO proprietary trading firm does not appear to involve any real buying and selling of actual assets, and that is not its purpose. Instead, profit and loss come only from the difference in price movements, through futures, index contracts, or similar hypothetical contracts and transactions.
Such dealings are not permissible under Shariah, because they involve several elements that Shariah prohibits, such as gharar (uncertainty), qimar (gambling), and the buying and selling of hypothetical items without ownership or possession. Therefore, income earned from such trading is also not permissible.
However, if real assets are actually being bought and sold under this system, and the conditions for the transfer of ownership and possession of halal items are met, then the Shariah ruling will depend on the nature of the business and its terms and conditions. No Shariah ruling can be given without knowing all of these details.
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دلائل:
القران الکریم: (المائدۃ، الایة: 90)
یٰۤاَیُّہَا الَّذِیۡنَ اٰمَنُوۡۤا اِنَّمَا الۡخَمۡرُ وَ الۡمَیۡسِرُ وَ الۡاَنۡصَابُ وَ الۡاَزۡلَامُ رِجۡسٌ مِّنۡ عَمَلِ الشَّیۡطٰنِ فَاجۡتَنِبُوۡہُ لَعَلَّکُمۡ تُفۡلِحُوۡنَo
سنن الترمذی: (کراهية بیع ما لیس عندك، رقم الحدیث: 1232)
عن حکیم بن حزام قال : أتیت رسول الله صلی الله علیه وسلم فقلت : یأتیني الرجل یسألني من البیع ما لیس عندي أبتاع له من السوق ثم أبیعه ؟ قال: ’’لا تبع ما لیس عندك ."
عمدۃ القاری: (435/8)
الغرر هو فی الاصل الخطر، و الخطر ھو الذی لا یدری أ یکون ام لا، و قال ان عرفة: الغرر ھو ما کان ظاھرہ یغر و باطنه مجهول، قال و الغرور ما راأیت لہ ظاہرا تحبہ و باطنہ مکروہ أو مجہول، و قال الأزہری: البیع الغرر ما یکون علی غیر عهدۃ و لا ثقة، و قال صاحب المشارق: بیع الغرر بیع المخاطرۃ، و ھو الجهل بالثمن أو المثمن أو سلامته أو أجله۔
مصنف ابن ابی شیبة: (کتاب البیوع و الاقضیة، 483/4، ط: مکتبة الرشد)
عن ابن سیرین قال: کل شيءٍ فیه قمار فهو من المیسر
الھندیة: (الفصل الثالث فی معرفة المبیع و الثمن و التصرف، 13/3، ط: دار الفکر)
فنقول من حکم المبیع اذا کان منقولا ان لایجوز بیعه قبل القبض....واما اذا تصرف فیه مع بائعه فان باعه منه لم یجز بیعه اصلا قبل القبض۔
رد المحتار: (کتاب الحظر و الاباحة، 403/6، ط: سعید)
(قوله: لأنه يصير قماراً)؛ لأن القمار من القمر الذي يزداد تارةً وينقص أخرى، وسمي القمار قماراً؛ لأن كل واحد من المقامرين ممن يجوز أن يذهب ماله إلى صاحبه، ويجوز أن يستفيد مال صاحبه وهو حرام بالنص
Allah the Almighty knows best.
Darul Ifta Al-Ikhlas, Karachi.