In some trading strategies, it may happen that the exact purchase price is unknown to the buyer or the seller.
Example : If you use a trailing stop, or buy at the market…
We know that in Islam, knowing the price is important.
But the broker knows the price, it’s probably a robot but does that settle the matter?
I don’t know the fiqh answer here but one could easily set a limit order and therefore have clarity on the price.
thank you for the answer if there is bad news at night and in the morning you want to sell the stock at the market price With the gap you will never know the selling price in advance
I asked this question to our shariah advisor Sheikh @Joe Bradford and he didn’t see it as an issue. He explained that the exact purchase price might be unknown at first, but it becomes concrete the second the trade is executed. It’s like saying to a trader, “Buy me XYZ at the same price as Umar pays.” Even though the price isn’t specifically known to him upfront in a relative sense, it is known in an absolute sense because it’s set by market standards at the time of purchase.
Baaraka llah o fik bro
so no problem to use trailing sell orders etc… even if the execution takes place when you are not in front of the screens
Based on the response from Sheikh @Joe, it wouldn’t be a problem.
With a limit order the selling price is fixed.
If the price gaps up or down, then you can easily change the limit order.
Then you can have 100% knowledge of the exact price, should you think it’s a requirement.