Forex traders have a variety of Forex brokerages and Forex trading platforms to choose from. But one broker type and account in particular stands out. Islamic Forex accounts are a type of trading account we don’t find anywhere else. Find out more!
Islamic Forex brokers might give customers the option to open an Islamic Forex Account, although this does not apply only for Muslims. Forex brokers – not just Islamic Forex Brokers – will never ask your religion.
Forex Islamic accounts are interest-free trading accounts, which is what they’re called. Then how does all this work? As an example, when a Forex Trader decides to open his orher positions overnight, the Standard Broker will charge Rollover Fees, which are essentially the interest fees the Standard Broker pays the Bank to open the trade overnight.
It is important to note that these charges are problematic for Islam. Islamic Shariah laws prohibit Muslims from receiving money in return of their “giving”. In other words, if a Muslim decides to invest in Forex he/she cannot pay interest or get any. As a side note, this also exists within the Jewish religious tradition.
Forex Islamic account concept was developed to allow Muslims to be able to trade Forex and meet their needs. In theory anyone can create an Islamic account. But it’s not right for everyone. Islamic Forex accounts may be interest-free in theory, but they can come with increased spreads or have other drawbacks depending on what broker is offering them.
The Islamic account could be the right solution for you, if your trading style is to leave positions open at night on a daily basis. If you choose to open an Islamic Forex trading account, your next task is to find the most suitable Islamic Forex broker. This can be done by looking at Forex Broker Reviews on leading websites, then filtering all those brokers out that do not allow you to trade using a Forex Islamic Account.