Top Rated Islamic Forex Brokers Reviews - 2020
Not all brokers offer an Islamic Forex account but those that do open up trading to millions of Muslim investors. According to Islamic law, often referred to as Sharia law, Muslims are prohibited from earning interest on their giving. This law also applies to interest earned on any banking or investing. Many brokers offer these traders the possibility of trading Forex according to Sharia law by opening an Islamic Forex account where interest-free Forex trading is made available. This is also called a ‘No Riba Forex’ account.
The team at Daily Forex examined the top Muslim friendly Forex brokers and has compared them in an easy to read list where you can determine which Islamic Forex broker is the best one for you. Some brokers will agree to change a traditional Forex account into an Islamic Forex account quickly and easily and this one of the features we have noted in the listing below, in addition to the other important information about our recommend Islamic Forex brokers.
Up To $5000
MetaTrader 4, MetaTrader 5, Proprietary platform, Web-based
MiFID, Central Bank of Ireland, FSA, ASIC, BVIFSC, FFAJ, FSCA, FRSA
CySEC, FCA, ASIC
How Does Islamic Trading Account Work?
So, what are the most important attributes to look for to determine whether a Forex / CFD brokerage can fairly be called an “Islamic Forex broker”? Basically, such a broker must be deemed to be Sharia compliant, and the key factor here is of course not charging or paying the common interest rate element on open trades. There are plenty of brokers who offer a special account type in which the interest charges and payments are simply removed. Of course, it makes sense that this can impact upon a client’s cost of trading, because most brokers will make an overall profit from the interest payments and will often try to compensate for their loss by charging slightly higher spreads or commissions in their “Islamic accounts”. However, it is true that more and more brokers are not doing this as they look to increase their market shares in the Islamic world, so traders with Islamic accounts can even be getting a net benefit by opening such an account. Another interesting “cost of trading” impact of using an Islamic account is that it can make sense to take a longer-term trading style especially when trading with the trend, as there is no cost to letting a winning trade ride when there is no danger of having to pay interest.
Typically, an Islamic account has no extra restrictions on the type of trades which can be made. A few brokers have been known to force closure on long-term trades held open in an Islamic account, so when you open an Islamic account, it is worth checking with the broker on this issue.