Islamic Forex Brokers
Finding a Shariah-compliant account to trade Forex, stocks and even cryptocurrencies is harder than it sounds. We've reviewed the best Islamic trading accounts and narrowed the list down to 3.
- AvaTrade Best Mobile Trading Platform 2021
- eToro Best Trading Platform, 2013 - Star Awards
- LQDFX Best ECN Broker, 2017
AvaTrade (AvaTrade.com) is an award-winning online broker. Trade CFDs on Forex, crypto-currencies, shares, metals and more on MetaTrader 4 or 5. AvaTrade accepts all Expert Advisors except those with a focus on arbitrage.
- Risk warning: 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
- Markets: Forex (CFD), Cryptos (CFD)*, Stocks (CFD), Indices (CFD), Metals (CFD), Energy (CFD), Commodities (CFD), Bonds (CFD)* Availability subject to regulation.
- Platforms: MetaTrader 4, MetaTrader 5, Copy trading
- Regulators: Australia, BVI, Ireland, Japan, South Africa, UAE
- Incorporated: 2006
eToro is the world's largest social trading platform, trusted by over 20 million users. Trade a wide range of markets from a single platform, on the Web or your mobile. Easily follow and copy other investors if you want to.
- Risk warning: 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
- Markets: NA* Availability subject to regulation.
- Platforms: Copy trading
- Regulators: Australia, CySEC, UK
- Incorporated: 2007
LQDFX (LQDFX.com) is an international Forex broker and CFD provider headquartered in the Marshall Islands. It delivers STP execution on MT4 across 71 currency pairs, indices and commodities.
- Markets: Forex (CFD), Indices (CFD), Metals (CFD), Commodities (CFD)* Availability subject to regulation.
- Platforms: MetaTrader 4, Mirror trading
- Regulators: Marshall Islands
- Incorporated: 2015
Islamic Brokers Reviewed
Before we get started, let's touch on what the 3 brokers featured in this article have in common. First, they charge no interest on positions that you keep open overnight. Their Islamic accounts are fully Shariah-compliant. Second, they don’t make-up for the lost interest by charging you extra. The spreads you’ll pay are the same as that paid by other traders. And finally, their islamic trading accounts have no additional charges.
eToro is TrustedBrokers' "Best Islamic Broker" in 2022.
With eToro (eToro.com), you can buy over 2,000 shares and ETFs from a wide range of American and international companies. This includes companies listed on the Nasdaq, the S&P, in Europe, Hong Kong and even Saudi Arabia. Because you’ll actually own the shares, you’ll be entitled to receive dividends. This will be of interest if you are a long term investor.
You can also buy over 20 crypto-currencies through eToro, and store them safely in your wallet. Popular coins include Bitcoin, Ethereum, Binance Coin and even Dogecoin. And if you’re a long term investor, you can now earn interest on your coins by staking them. However, please note that crypto-currencies may not be available in your country.
We like that eToro’s Islamic trading account places no restrictions on how long you can keep your positions open. Furthermore, there are no extra fees or hidden charges. However, you should note that it comes with a 1,000-dollar minimum first-time deposit. Subsequent deposits need only be above $50.
To open an Islamic account with eToro, open an account on eToro.com, fund your account, and contact eToro's customer service team to request a Shariah-compliant account. It's important that you do this before placing your first trade.
AvaTrade (AvaTrade.com) allows you to trade CFDs on over 1000 instruments. These include Forex, stocks, indices, commodities and bonds. And while AvaTrade also offers CFDs on crypto-currencies, these are not available through its Islamic account. AvaTrade supports MetaTrader 4 and 5, two of the world’s leading retail trading platforms.
We like that AvaTrade allows you to open an account from a low $100 initial deposit. However, AvaTrade won’t allow you to keep your positions open for more than 5 days. That’s why its Islamic account is best suited to day traders.
To open an Islamic account with AvaTrade, open an account online on AvaTrade.com, fund your account and apply for an Islamic account for trading. AvaTrade aims to process your request within 1 to 2 business days.
We like that LQDFX (LQDFX.com) places no restrictions on how long you can keep your positions open in its Islamic account. Furthermore, there are no additional charges or hidden fees. You can open an account from a low as $500, or upgrade to a VIP one when you deposit over $25,000.
However, LQDFX supports fewer instruments than AvaTrade and eToro: its MetaTrader 4 platform is focussed around CFDs on Forex, indices and commodities. It doesn't support CFDs on stocks, indices or crypto-currencies. But does allow all trading styles and Expert Advisors (such as hedging, scalping and arbitrage bots).
Because LQDFX operates as a straight-through processing broker, it aggregates prices from leading banks, and forwards your orders onto them for execution. Ultimately, you’ll benefit through tighter spreads, greater certainty of execution and no re-quotes. This may appeal to you, if you dislike the idea of your broker acting as a market maker.
Islamic Broker Checklist
We hope this article has helped narrow your options and we would encourage you to create either a live or a demo account with each of these brokers, to see what they have to offer. If not, here's a checklist of items to look for when searching for a Shariah-compliant broker:
- No interest on overnight positions (also called swap fees).
- No time limit placed on positions kept open overnight.
- No fees charged on positions kept open overnight.
- No additional charges (e.g. administrative fees).
- No spread-widening for Islamic accounts.
Trade 70+ currency pairs, spot indices, energies, metals and shares on floating spreads and instant ... MoreTrade 70+ currency pairs, spot indices, energies, metals and shares on floating spreads and instant execution. All EAs are allowed.
- $500 deposit
- 1:200 leverage ?
- 1.71 pips EUR/USD
Trade 55 currency pairs on fixed spreads, plus CFDs on crypto-currencies, stocks, indices, bonds and... MoreTrade 55 currency pairs on fixed spreads, plus CFDs on crypto-currencies, stocks, indices, bonds and commodities. This account, registered in the British Virgin Islands, has significantly higher leverage.
- $100 deposit
- 1:400 leverage ?
- 0.9 pips EUR/USD
Trade over 60 pairs of currencies as well as CFDs on metals, indices and commodities through MT5 ... MoreTrade over 60 pairs of currencies as well as CFDs on metals, indices and commodities through MT5 with this ECN account. Get ultra-fast execution speeds under 40 milliseconds.
- $100 deposit
- 1:500 leverage ?
- 0.09 pips EUR/USD
Trade 55 currency pairs on fixed spreads, plus CFDs on crypto-currencies, stocks, indices, bonds and... MoreTrade 55 currency pairs on fixed spreads, plus CFDs on crypto-currencies, stocks, indices, bonds and commodities. Access high leverage up to 1:400 with this account for professional traders.
- $100 deposit
- 1:400 leverage ?
- 0.6 pips EUR/USD
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