Islamic scholars and bodies ruling on stocks and equities.
Who ruled·What they said·Where to read it
Buying shares is permitted by the bodies below, with conditions on the company and on how you pay for them.
Last reviewed 26 September 2026.
Rulings and positions
The Academy's 1992 resolution on financial markets starts from permission. A share is your portion of what a company owns, so owning one is lawful when the company's purpose and activities are lawful.
The line is drawn at what the company does. A company built around riba or forbidden products is off limits, and the Academy notes there is no disagreement on that. A company whose main business is fine but which sometimes deals in riba is still treated as prohibited by default. In the resolution's words, "prohibition is the primary judgment" for that case.
The same resolution closes two doors on how you buy. You cannot buy shares with an interest-bearing loan from your broker, and you cannot sell shares you do not yet own.
SourcesIIFA Resolution 63
Malaysia takes a measured approach to companies with mixed income. A listed company passes if less than 5% of its total income comes from activities such as conventional banking and insurance, gambling, alcohol, pork, tobacco and interest.
Its balance sheet is then checked twice. Cash held in conventional accounts, and interest-bearing debt, must each stay under 33% of total assets. The SAC also weighs how the company's activities are seen from the perspective of Islamic teaching.
Foundations and principles
Trade is permitted and riba is forbidden (Al-Baqarah 2:275). A share is a portion of a company's assets, so buying one is trade, and what the company does with its money decides whether the trade is clean.
The two rulings above differ on companies with mixed activities. The Fiqh Academy starts from prohibition for any company that sometimes deals in riba. Malaysia's SAC tolerates a small share of it, measured by its 5% and 33% benchmarks.
ReadAl-Baqarah 2:275
What passes
- The company's main activity is lawful.
- Non-compliant income stays under 5% of total income, and conventional cash and interest-bearing debt each stay under 33% of total assets (SC Malaysia's benchmarks).
- You pay with your own money, not an interest-bearing loan from a broker, and you never sell shares you do not own (IIFA Resolution 63).
Further reading
References
- International Islamic Fiqh Academy (9 to 14 May 1992). Resolution No. 63 (1/7) on Financial Markets (Shares, Options, Commodities, and Credit Cards), Jeddah. Source
- Securities Commission Malaysia. Shariah-Compliant Securities Screening Methodology. Source
ShariaQuant summarises what each body ruled, quotes the wording that matters, and links to every source so you can read the full ruling yourself. This is a record of their rulings, not a fatwa of our own.