What is a Stock Market?
The Stock market is a market where you can trade(buy and sell) the shares of public listed companies. It is a market where companies raise capital for their businesses through an initial public offering (IPO).
These stocks are also known as equities; are a small share of ownership in the company and these equities are issued, bought or sold in the share market.
Is Stock Market Halal or Haraam?
Investing in the stock market is definitely halal but there are certain guidelines that are compulsory to follow while making such investments. If these guidelines are not ensured then the income gained from the stock market would be Haraam. The Ulema e deen and Islamic scholars have specified these guidelines which are also referred to as stock screening criteria.
Find the steps to screen a stock in our blog post.
Scope Of Stock Market
The scope of the stock market mainly focuses on two factors:
- Raising Capital For Companies
- Allowing Investors and Traders to Share Profits.
Stock Market provides an opportunity for public listed companies to raise capital required for the growth and expansion of their businesses without getting into debt. The stock market enables such companies to list their stocks for selling, which in turn, raises funds for the companies. For example, If a company lists 1 million stocks and initially sells them for 10Rs then the company will be able to raise 10 million Rupees without having to borrow it or pay any interest.
At the same time, the stock market grants an opportunity to the investors and traders to make profits from the shares of the public listed companies. Investors can invest in stocks and earn dividends as per the amount of ownership shared. Traders can, on the other hand, trade (buy and sell) these stocks and earn a fair share of money. Traders basically purchase stocks at lower prices and sell them once the price of the stock increases above the purchase price.
Why Stock Market is considered Risky?
Simply because- it is difficult to predict. Stock market investing and trading is majorly dependent on predicting the future of the company and its sector. When you invest in the stocks of a company, only two of the following things can happen, firstly the price of the stock that you had invested in goes up giving you higher returns and secondly the price of the stock that you had invested in goes down as a result of which you lose money. Although predicting the stock market is difficult, it is not impossible. This prediction of the stock market is done with the help of technical and fundamental analysis.
Technical analysis is essential for trading whereas fundamental analysis helps in long-term investing. With the help of these analyzing techniques, one can easily predict the future movements of a stock and can manage the risk to make profitable trades or investments. These techniques of analysis have been used for years by successful traders and investors to predict the movements in the market. These techniques are highly effective in predicting future movements but do not provide a 100% guarantee.
There are hundreds of articles available on the internet about what technical analysis is? and various techniques used for it, but still it is not easy to use those techniques because there is no proper explanation on how to execute those techniques while taking a trade.
If you want to learn technical analysis with proper execution to become a trader, you can join our courses where you will learn these techniques along with emotion management which is another key factor while dealing in the stock market.
Why should you invest in the stock market?
Investing in Stock market helps in the following ways:
- To Increase Your Wealth.
- To gain more returns compared to any other investment.
- To have a Strong financial retirement plan.
- To have a stable income through dividends in long-term investments.
- To invest and earn from sectors of your choice.
Stock market investments have several other benefits along with the ones mentioned above. Becoming a stock market trader can help you to quit your 9 to 5 jobs and invest your time and capital according to your understanding. It gives you more freedom to plan your financial independence.
Why choose Shariah Investments India to Start Your Journey in the Stock Market?
Shariah Investments India is an organization formed with the objective of introducing halal ways of earning from the stock market. Often the stock market is straight-up termed as haraam because of its nature and also because certain terms such as gambling etc. are associated with it. But factually investing in the stock market and gaining income from it is not haraam. There are some strict criteria, which if failed to follow while investing in the stock market, makes the income haraam.
Shariah Investments India aims to help the members of the Muslim community to understand these criteria and make halal profits.
At Shariah Investments India you can join our courses to become a full-time halal trader or an investor. We at Shariah investments India teach our students to trade in the market while keeping in mind these Stock screening criteria which are essential for halal trading.
We Provide courses for absolute beginners to start trading from basics and also for intermediates to advance and upgrade their trading skills and boost confidence.