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Halal Binary Options

Written By

William Berg

Written By

William Berg

William contributes to several investment websites, leveraging his experience as a consultant for IPOs in the Nordic market and background providing localization for forex trading software. William has worked as a writer and fact-checker for a long row of financial publications.

» William Berg Profile Page

Edited By

Tobias Robinson

Edited By

Tobias Robinson

Tobias is a partner at DayTrading.com, director of a UK limited company and active trader. He has over 25 years of experience in the financial industry and contributed via CySec to the regulatory response to digital options and CFD trading in Europe. Toby’s expertise and dedication to financial education make him a trusted voice in the industry, including a BBC investigation into digital options.

» Tobias Robinson Profile Page

Updated

May 31, 2024

Whether binary options are Halal or Haram is open to interpretation, however trading platforms are increasingly offering accounts that aim to comply with Islamic finance principles. This guide weighs both sides of the debate and evaluates the binary options brokers marketing Halal accounts.

This article is not a source of religious advice. Speak to a local religious leader for further guidance.

Best Halal Binary Options Brokers

Our tests show these are the top 1 brokers with Halal binary options accounts:

Click a broker for details

1. 1

   
   World Forex
   Go To World Forex

   World Forex Review

   New Customer Bonus Offer 100% Deposit Bonus

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   Minimum Deposit $1

   Minimum Trade 0.01 Lots

   Leverage 1:1000

   Regulator SVGFSA

   Instruments Forex, CFD Stocks, Metals, Energies, Cryptos, Digital Contracts

   Platforms MT4, MT5

   Payment Methods Wire Transfer, Debit Card, Credit Card, Visa, Mastercard, Google Wallet, Apple Pay, Perfect Money, Bitcoin Payments, Volet

   Account Currencies USD, EUR, RUB

   Go To World Forex

Here is a short overview of each broker's pros and cons

1. World Forex - World Forex offers binary options where you simply decide the stake, price direction and contract timeframe. The payouts are high at up to 100% on American contracts and 85% on European, which also offers a partial refund to traders who close contracts before expiry.

Halal Binary Options Comparison

Halal Binary Options Comparison

Broker	Islamic Account	Markets	Regulator	Minimum Deposit
	✔	Forex, CFD Stocks, Metals, Energies, Cryptos, Digital Contracts	SVGFSA	$1

World Forex

"World Forex provides both highly leveraged CFDs and digital contracts, making this a good broker for clients who want flexible and rewarding ways to trade. The copy trading service will also appeal to newer traders."

Tobias Robinson, Reviewer

World Forex Quick Facts

Bonus Offer	100% Deposit Bonus
Minimum Deposit	$1
Payout %	100%
Expiry Times	1 minute - 7 days
Copy Trading	Yes
Platforms	MT4, MT5
Instruments	Forex, CFD Stocks, Metals, Energies, Cryptos, Digital Contracts
Account Currencies	USD, EUR, RUB

Pros

• Swap-free account available
• Educational content
• Low deposit of $1

Cons

• Withdrawal fees apply
• Weak regulation
• No negative balance protection

Visit World Forex

World Forex Review

Are Binary Options Compatible With Islam?

These are the three core arguments on each side of the debate:

Haram

Halal

Ultimately, whether binary options trading is Halal or Haram will depend on who you ask and the trader in question.

That said, this is fairly clear: wild binary trades made with no clear plan or understanding of the financial markets are likely to be considered Haram.

How Halal Binary Options Accounts Work

With online trading rising in popularity, including amongst Muslim investors, we’ve seen a growing number of brokers introduce Islamic-friendly accounts. These are essentially swap-free accounts that are designed to completely remove Riba from trading.

Halal binary options accounts should meet three criteria:

1. Immediate execution of trades: Muslim teachings state that hand-to-hand exchanges should be prompt
2. Immediate settlement of transaction costs: This avoids open trades being rolled over to the next day
3. Zero-interest: Charging or incurring interest on trades

If a broker’s Islamic account does not meet these conditions, your binary options trading activities may not be considered Halal.

Having spent years evaluating binary options trading platforms, there are several other relevant factors to consider:

• Choice of underlying asset: Leading platforms today offer binaries on a wide range of underlying assets, from stocks and indices to commodities and cryptocurrencies. However, keep in mind that some consider it inappropriate to trade binaries in stocks relating to forbidden industries, for example, producers of alcohol, tobacco, weapons and adult entertainment.
• Interest on unused cash: We’re observing a growing number of brokers paying interest on unused trading balances. These should be avoided, as this practice is forbidden in Shariah Law.
• Security of funds: Binary options scams have plagued the industry in recent years, stealing traders’ deposits or unfairly manipulating trading conditions in their favour. One high-profile Europol case from 2021 involved a cross-border investigation into the theft of at least €15 million from victims of fake binary options websites operating out of Bulgaria, Cyprus and Ukraine. This highlights the importance of treating all binary brokers with caution, no matter how professional they appear.

Bottom Line

The issue of whether binary options trading is Halal or Haram will continue to be debated by scholars.

However, some feel that by trading binary options strategically, Muslims can avoid gambling. Also, several brokers now market halal binary options accounts to help traders stay within Shariah Law.

Ultimately, DayTrading.com is not a religious authority so we cannot say with certainty whether binary options trading is Halal or Haram. This will depend on your interpretation and individual approach to trading.

That’s also why we recommend consulting a local religious leader and reading the materials below.