Islamic traders can avoid swap rates by trading in an Islamic account, which ensures they follow Sharia law. It allows Muslim traders to engage in leveraged trading while adhering to their religious beliefs. The FXTM Islamic account is among the two FXTM account types suitable to Islamic traders, the other being the FXTM demo account. Get the details of the FXTM Islamic account from my FXTM Islamic account review and know what to expect.
What Is the FXTM Islamic Account?
The FXTM Islamic account is a Shariah-compliant swap-free trading account. It promotes ethical and interest-free financial transactions for Muslim traders. Therefore, traders keeping leveraged overnight positions neither pay nor receive financing rates, also known as swap rates.
Swap-free Islamic accounts have an allowance of swap-free days before a swap-free fee applies. FXTM lists the swap-free day allowance on its website under contract specifications. Forex trades get seven days before FXTM charges the swap-free fee. Major Forex pairs have a daily swap-free fee between $1.50 and $20.00 per 1.0 standard round lot.
The FXTM minimum deposit requirement for the FXTM Islamic account is $200 or a currency equivalent, the same as opening any FXTM account. The availability of the various methods for FXTM withdrawals depends on the geographical location of Islamic traders, but bank wired and credit/debit cards are available to all traders. FXTM also has localized methods for its core markets of Muslim traders, including Pakistan and Nigeria.
Why Is Interest Discouraged or Prohibited by Sharia Law?
Interest under Sharia law is a religious matter. Therefore, Islamic traders should consult their Imam to clarify Sharia law and why receiving interest is discouraged. Even among scholars, divisions exist in Sharia law and how it applies to finance. The FXTM Islamic account complies with Sharia law, allowing Islamic traders to adhere to their faith while engaging in leveraged overnight trading.
Key Features of an Islamic Brokerage Account
The core feature of any Islamic account is the absence of swap rates to comply with Sharia law, but other aspects may differ among brokers. Some brokers substitute the absence of swap rates with fixed fees to compensate for the loss of income, increase spreads, or apply trading restrictions. Islamic accounts allow Muslim traders to engage in leveraged trading without violating their faith. Demo accounts are also available, but they may not reflect the swap-free feature of live accounts, which is acceptable, as demo accounts use virtual funds.
Special Restrictions for Islamic Accounts
Special restrictions for Islamic accounts are broker-dependent. They include time limits on leveraged overnight positions before fixed fees apply, trading platform restrictions, asset selection restrictions, and leverage restrictions. Some brokers increase spreads or add administrative fees to Islamic accounts. Geographic restrictions may also apply, and some brokers require proof that a trader follows the Islamic faith.
Noteworthy FXTM Islamic account conditions include the following:
- Forex traders get seven swap-free days
- FXTM levies a fixed swap fee between $1.50 and $20.00 per 1.0 standard round lot daily after seven days
- Islamic traders must provide a certification from a recognized religious authority like an Islamic scholar, Imam, or mosque
What Are the Steps Involved in Opening a FXTM Islamic Account?
Islamic traders must manually enable swap-free status after opening an FXTM trading account.
Here are the steps to active swap-free status at FXTM:
1. Log into your MyFXTM Dashboard.
2. Navigate to “My Accounts” in the left-hand menu and click “Accounts Overview.”
3. Check the orange box next to “Deposit” of the account you want to switch to swap-free, followed by “Enable Swap Free.”
4. Click “OK” on the pop-up, and you have converted your account to an FXTM Islamic account.
Notable Features of the FXTM Islamic Account
During my FXTM broker review, the FXTM Islamic account offered Islamic traders the core features outlined below.
The core features of the FXTM Islamic account are:
- No swap rates, making it Sharia-compliant
- Forex traders receive seven swap-free days
- FXTM levies an asset-dependent fixed swap fee between $1.50 and $20.00 per 1.0 standard round lot daily after seven days
- A $200 FXTM minimum deposit requirement or currency equivalent
- A choice of payment processors, including localized methods for Islamic traders from Pakistan and Nigeria
- Competitive FXTM fees in the commission-based account
- FXTM demo account
- Balanced asset selection of liquid trading instruments
FXTM Islamic Account Pros and Cons
Muslim traders should consider the pros and cons of the FXTM Islamic account.
The Pros of the FXTM Islamic Account
- No swap rates
- Competitive FXTM fees featuring raw spreads of 0.0 pips with a commission of $7.00 per 1.0 standard lot on many assets
- A cutting-edge price improvement technology, lowering fees by an average of $3.00 per lot, applicable on 97.18% of all trades
- Deep liquidity delivers an average execution time of 0.071 seconds
- VPS hosting provides 24/5 low-latency Forex trading
- Services by Trading Central, the FX Blue upgrade package for MT4, and its in-house Pivot Point Strategy plugin
- FXTM Trader and FXTM Invest for mobile and copy traders
- 1:3000 maximum leverage with negative balance protection
- FXTM demo account
- Balanced asset selection
- Account base currencies are USD, EUR, and GBP
The Cons of the FXTM Islamic Account
- Swap fees after seven days on leverage currency pairs
Bottom Line
The FXTM Islamic account promotes ethical and interest-free financial transactions for Muslim traders, as it complies with Sharia law. Forex traders get seven swap-free days before a daily swap fee applies. The FXTM swap fee is fixed and asset-dependent, ranging from $1.50 to $20.00 per 1.0 standard round lots. Islamic traders must provide a certification from a recognized religious authority like an Islamic scholar, Imam, or mosque. FXTM remains one of the most transparent brokers offering Islamic accounts. Traders using the FXTM Islamic account can use a maximum leverage of up to 1:3000. The FXTM demo account is available to all traders. FXTM accepts Muslim traders and offers them a Sharia-compliant FXTM Islamic account. It is safe to open an Islamic account with FXTM, an industry-leading broker offering one of the most transparent Islamic accounts. Many brokers offer an Islamic account, including FXTM, which ranks among the most transparent brokers with an Islamic account. FXTM is an excellent broker due to its cutting-edge price improvement technology, deep liquidity, competitive FXTM fees, and trustworthy trading environment. Muslim traders can convert an FXTM account into a swap-free FXTM Islamic account.FAQs
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