Short Selling in Islam

Why short Selling is not allowed?

Shariah does not permit Short-Selling. The short selling is defined as selling the goods which are not in the possession of the seller. This activity in the market is used to create artificial supply and manipulation of price. It is a pure speculation. Islam does not permit any manipulation and interference of price mechanism. Even our beloved Prophet (saw) refused to interfere in the price mechanism of the market forces and said that it is prohibited on you to sell anything that is not in your possession. 


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