GHARAR IN STOCK OPTION TRANSACTIONS A SHI'A JURISPRUDENCE APPROACH

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MESBAHI MOGHADAM GH.R.; ROSTAM ZADEH GANJI E.

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Journal Paper

Paper Information

Journal: Journal of Iran's Economic Essays; an Islamic approach Year:2007 | Volume:4 | Issue:8 Page(s): 39-64

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Title

GHARAR IN STOCK OPTION TRANSACTIONS A SHI'A JURISPRUDENCE APPROACH

Author(s)

MESBAHI MOGHADAM GH.R. | ROSTAM ZADEH GANJI E. | Issue Writer Certificate

Keywords

GHARARQ2

STOCK OPTIONQ3

RIGHTQ2

VAGUENESSQ3

SALEQ3

Abstract

In transactions, GHARAR has always been noticed by Shi'a jurisprudence (Figh) and Muslim scholars have always tried to avoid it. GHARARian transaction is one that its results are so vague that produce unusual probability for loss. As a whole, there are three fundamental cases of GHARAR, including VAGUENESS in sold existence, descriptions and ability to deliver it. In risk management, one of the most applied transactions all over the world is STOCK OPTION transaction. Benefiting from financial instruments, the dubiety of GHARAR in this transactions has always been challenging and under consideration. By an exact jurisprudential consideration it is found that this transaction is divided into two stages. The first stage is an exchange of engagement for price and the second one is selling RIGHT. There almost always have been disputes on selling RIGHTs among scholars. Assessing reasons given by those in agreement or disagreement, it is concluded that selling RIGHT is approved (in some shi'a jurisprudence approaches such as those by Imam Khomeini). Existence of credit risk, VAGUENESS in option's descriptions and option contract qualification for delivering the RIGHT possession are problems which generate the dubiety of GHARAR in these transactions. Considering clearing room role, existence of standard contracts and being common the credit delivering instruments in use among rationales, the dubiety of GHARAR in these transactions is rejected in shi'a jurisprudence approach.

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APA: Copy

MESBAHI MOGHADAM, GH.R., & ROSTAM ZADEH GANJI, E.. (2007). GHARAR IN STOCK OPTION TRANSACTIONS A SHI'A JURISPRUDENCE APPROACH. JOURNAL OF ECONOMIC ESSAYS, 4(8), 39-64. SID. https://sid.ir/paper/108934/en

Vancouver: Copy

MESBAHI MOGHADAM GH.R., ROSTAM ZADEH GANJI E.. GHARAR IN STOCK OPTION TRANSACTIONS A SHI'A JURISPRUDENCE APPROACH. JOURNAL OF ECONOMIC ESSAYS[Internet]. 2007;4(8):39-64. Available from: https://sid.ir/paper/108934/en

IEEE: Copy

GH.R. MESBAHI MOGHADAM, and E. ROSTAM ZADEH GANJI, “GHARAR IN STOCK OPTION TRANSACTIONS A SHI'A JURISPRUDENCE APPROACH,” JOURNAL OF ECONOMIC ESSAYS, vol. 4, no. 8, pp. 39–64, 2007, [Online]. Available: https://sid.ir/paper/108934/en

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