Shariah Forex Accounts
Etoro.com (one of the largest online forex brokers in the world) offers the ability to sign up for an Islamic forex account (compliant with Islamic Sharia law).
With a traditional forex account, any open positions that aren't closed before 5 pm (New York time) are automatically rolled over to the next trading day. The problem with this? The potential of usurious interest that is often charged for the rollover.
With the Etoro Islamic account, all of your positions are automatically closed at 5 pm EST. The client has the option of reopening the trade immediately without incurring any usurious interest. In addition, Etoro does not take any additional rollover commissions for contracts lasting more than 24 hours.
What about using leverage? Does Etoro charge usurious interest if you want to use leverage?
The answer? No. According to their Islamic account page, "an eToro Islamic account provides you with interest-free leverage."
Etoro does not charge any commissions or fees for fund management - instead, their revenues are derived from "spreads" (the difference between the Ask and the Bid in a currency pair."
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In order to open an Etoro Islamic account, you need to follow these steps:
1. Open a real account on Etoro (click here to download the software)
2. Fund your account with a minimum of $1,000.
3. Request the necessary documents from customer services to change your account to an Islamic one.
That's it!
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