Mumbai: Muslims in the country will get their first online trading platform this week during Diwali.
Parsoli Corp. Ltd, an Ahmedabad-based brokerage that caters to a Muslim clientele, is all set to launch Stockmultiplier.co.in, the first-of-its-kind Islamic online trading facility to be available for Muslims in India.
Investment guide: Stockmultiplier.co.in, the online portal of Parsoli, is the first-of-its-kind Islamic online to be available for Muslims in India.
Parsoli has earmarked the auspicious occasion of Diwali for the formal launch of the trading platform. Why did a brokerage firm, which caters to a Muslim client base, choose the Hindu festival of lights for its formal launch?
Diwali is considered an auspicious occasion for the trading community as a whole and is celebrated with a “muhurat trade”—a symbolic ritual carried out by traders on the Bombay Stock Exchange (BSE) to mark the beginning of the new year, although the exchange is closed on that day. On 9 November, the Hindu calendar year Vikram Samvat 2064 commences.
“Diwali coincides with Friday this year, that is a holy day of Islam as well,” says Zafar Sareshwala, managing director and chief executive officer of Parsoli Corp. “Diwali is considered an auspicious occasion for the trading community and we will mark it with the launch of our online trading platform. Muslims need not worry about their religious tenets while online trading anymore, because we will offer Shariah-compliant trading.”
Muslims are not allowed to invest in companies involved in the business of alcohol, gambling, the media, and those that have a high income from interest, such as commercial banks and financial institutions.
The Islamic tenets, which govern every aspect of Muslim life including investing norms, is called Shariah.
While internationally Islamic investment products are among the fastest growing in the world, Indian Muslims largely stay away from formal investing. This is because members of the community in India have lacked Islamic investment products.
Parsoli already has an Islamic investment index, which is a guide for Muslim investors, and recommends the companies that Muslims are allowed to invest in.
The guide also has constructed a model portfolio. According Sareshwala, this portfolio has outperformed the BSE’s 30-share benchmark index, the Sensex, by 16% since January.
The online trading platform also will lead Muslim investors to Islamicequity.co.in, where Muslim scholars will answer Shariah-related queries of investors. Parsoli will have at least two Muslim scholars answering investors’ questions at any given time.
“Through the Internet, we usually get questions from first-time investors,’ says Mufti Abdul Qayoom, a judge at an Ahmedabad Islamic court and a panel member of the brokerage that answers online questions. “Typically, they ask what kind of companies they can invest in, whether they can do futures and options trading or even intra-day trading.”
Sareshwala says that having Muslim scholars answer online investor questions is bound to give a boost to the confidence of first-time Muslim investors who would otherwise have been wary of entering the stock market.