Working in the trade rooms and as a financial analyst
27-3-2011 | IslamWeb
Question:
Assalamou Aleykoum wa rahmatou llaahi wa barakatouh All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad (saw) is His slave and Messenger. I am a Muslim student in finance. I would like to know if a trader (someone who buys and sells financial instruments) in the trading rooms, is it permissible for a Muslim? As the profession of financial analyst, is it permissible for a Muslim? Allaah Knows best May Allaah grant you the best rewards. Assalamou Aleykoum wa rahmatou llaahi wa barakatouh
Answer:
All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad 
is His slave and Messenger.
It is permissible for a Muslim to practise any permissible work by which he earns his living, supports his family, and avoids asking people for money and being in need of them. He should be the upper hand (the one who gives) and not the lower hand (the one who takes) in order to earn the excellence that is reported in the Hadeeth (i.e. the saying of the Prophet, sallallaahu ‘alayhi wa sallam, “…the upper hand (the one that gives) is better than the lower hand (the one that receives)…” [Al-Bukhari and Muslim].
Among the permissible jobs is trading, which is buying and selling; Allaah Says (what means): {But Allaah has permitted trade.} [Quran 2:275] Allaah also Says (what means): {O you who have believed, do not consume one another’s wealth unjustly but only [in lawful] business by mutual consent.} [Quran 4:29]
However, even though Allaah permitted selling in general and permitted trade in general, He forbade some kinds of it, like the void contracts, such as the contracts of Riba (interest and/or usury) deceit and gambling, as Allaah Says (what means): {But Allaah has permitted trade and has forbidden interest.} [Quran 2:275]
Therefore, if trading in financial instruments does not abide by the Sharee’ah because it involves Riba, deceit and gambling, then it is not permissible but if it abides by the Sharee’ah then it is permissible.
Also, it is permissible to do the job of financial analyst unless this is for an unlawful institution or that it is used to engage in what is forbidden, in which case, it would be forbidden not in itself but because it helps in what is forbidden. Allaah Says (what means): {...but do not help one another in sin and transgression.} [Quran 5:2]
In fact, financial analysis is very important as it helps to outline the objectives and rectify the deviations, and it helps to discover new investment opportunities and so forth. Since financial analysis is of this importance, it is not permissible to carry it out for an unlawful institution or an individual who aims to carry out what is forbidden, like Riba transactions and the like. Other than this, it is permissible to do it as this is lawful in principle.
Allaah Knows best.