08-14-2003, 04:01 AM
Hi Evolution!
Investment in stock markets and bank loan are very different.
Bank loans charge interest not on the expectations of profits but on a host of other factors such as length of time, collateral, current interest rate markets etc. This interest has to be paid irrespective of whether the borrower makes money or not. However, in stocks markets, company pays divdends(a share in the profits) when they are profitable themselves or expected to be profitable in futures. Dividends are not guaranteed like interest payments. If company is unsuccessful, then its shares prices go down and the investor shares in the losses indirectly.
As far I know all major islamic countries have stock exchanges. If trading in stocks was unislamic, they would have banned it.
Regrads
Investment in stock markets and bank loan are very different.
Bank loans charge interest not on the expectations of profits but on a host of other factors such as length of time, collateral, current interest rate markets etc. This interest has to be paid irrespective of whether the borrower makes money or not. However, in stocks markets, company pays divdends(a share in the profits) when they are profitable themselves or expected to be profitable in futures. Dividends are not guaranteed like interest payments. If company is unsuccessful, then its shares prices go down and the investor shares in the losses indirectly.
As far I know all major islamic countries have stock exchanges. If trading in stocks was unislamic, they would have banned it.
Regrads
