Is It Permissible to Invest in Stocks in Islam?

A questioner asks is it permissible to invest in stocks in Islam? The Shariah doesn’t care what kind of stocks they are. There are different factors that make stocks halal and haram.

We can invest in stocks in Islam if certain conditions are met. Some of the conditions vary between Fiqh committee to Fiqh committee but there are some broad conditions that everyone agrees upon.

The first condition is that the product itself should be halal. You cannot invest in budweiser or other such haram things. The second condition is that interest and interest loans need to be taken into account. How much liquid assets are available and how much is loaned from the company? There are different ratios set on this so one has to check.

There is something called the Islamic Dow Jones Index so if you are interested in investing in stocks you can look that up. There are also corporations and companies that do the homework for you and they have a portfolio of stocks that are permissible.

You are allowed to invest in stocks that are overall halal. The easiest thing to do is to go through a third party and ask them if the stocks you are interested in are meeting the standard or not.