FP Markets Islamic Account Review

FP Markets is a well-established broker known for its competitive trading conditions and strong regulatory oversight. This broker accepts clients from many regions and has a large client base that includes a significant number of Muslim traders. These Muslim traders must participate in financial markets ethically, in line with their religious principles.

FP Markets takes into account these principles and provides an Islamic account that offers Sharia-compliant trading opportunities. In this comprehensive FP Markets Islamic account review, we will look at the broker's offering to Muslim traders, detailing the pros and cons of its swap-free accounts.

Understanding Islamic Trading Accounts

In conventional forex and CFD trading, holding positions overnight typically incurs a type of interest charge known as a swap fee. However, Islamic finance prohibits the paying or earning of interest (Riba). As such, Muslim traders cannot use traditional trading accounts as they conflict with Islamic finance principles. Islamic trading accounts are tailored to meet these religious requirements while allowing traders to participate in financial markets. 

Islamic accounts achieve this by eliminating swap fees, providing a Sharia-compliant environment for Muslim traders. Different brokers often implement swap-free accounts in various ways. For instance, some may charge administration fees to compensate for the lack of swap charges. Let’s see how this works on FP Markets.

72.44% of retail CFD accounts lose money

How Islamic Account Works on FP Markets

FP Markets fully supports a Sharia-compliant trading environment on its Islamic account. There are four main ways FP Markets achieves this:

• No Swap Fees - FP Markets does not include any swap charges on positions held overnight. This makes the Islamic account halal in line with Islamic finance principles.
• No Gambling - There is no gambling involved on FP Markets’ Islamic account. Islamic trading does not tolerate gambling. Islam exempts trading, considering it educational when buying and selling assets based on analysis and the use of various concepts and investment strategies.
• Risk and Benefits Distribution - A key concern in trading is shared risk. In Islam, earning interest is not allowed because it rewards the lender without sharing the risk, which falls only on the borrower. Therefore, FP Markets Islamic trading accounts waive all interest charges.
• Immediate Exchange or "Hand in Hand" - With interest removed, the next key rule is that trading must be "hand in hand." In the past, this meant face-to-face. However, with modern online trading, where transactions between brokers and traders happen almost instantly, this is considered halal (permissible) under Shariah law.

FP Markets’ Islamic Account

FP Markets offers an Islamic account option for both its Standard and Raw accounts. The minimum opening balance for both these accounts is $100 or equivalent in other currencies. The trading conditions for these accounts are very similar to the traditional accounts on FP Markets. The Standard Islamic account features spreads from as low as 1.0 pips with no extra commission. In contrast, the Raw Islamic account offers spreads from 0.0 pips with a commission of $3 per 100,000 traded. 

The Islamic account on FP Markets is available exclusively on MetaTrader 4 and MetaTrader 5. These platforms offer traders intuitive trading interfaces with advanced tools. Additionally, they offer ultra-fast execution speeds, with most orders executed in under 40 milliseconds. 

FP Markets Islamic account offers the full range of instruments available on the broker site. These include CFDs on forex, indices, metals, commodities, stocks, bonds, and ETFs. These accounts support a variety of trading strategies, including Scalping, Swing Trading and Day trading. 

Importantly, FP Markets charges an administrative fee when trading on an Islamic account. The specific fee varies depending on the asset a client is trading. FP Markets is upfront about these fees and has provided a detailed table on its website. For a few select instruments, there is a grace period of 5 nights where traders can hold positions overnight with no admin fee charged. The information on the exact instruments is readily available on FP Markets’ website.

Pros of FP Markets Islamic Account

• Sharia Compliance - The primary benefit is that FP Markets' Islamic account adheres to the principles of Islamic finance by eliminating swap fees, allowing Muslim traders to participate in the forex and CFD markets ethically.
• Access to Popular Platforms - An Islamic account is available on MetaTrader 4 and MetaTrader 5, two of the most widely used and feature-rich trading platforms. They offer advanced charting tools, expert advisor (EA) compatibility, and a user-friendly interface, among other features.
• Competitive Trading Conditions - FP Markets Islamic account features similar trading conditions to the Standard and Raw accounts, ensuring a seamless trading experience.
• Wide Range of Instruments - Muslim traders can access the full range of market products offered by FP Markets. 

• Flexible Account Types - The availability of Islamic options on both Standard and Raw accounts provides flexibility in choosing a fee structure that suits individual trading styles.

Cons of FP Markets Islamic Account

• Administration Fees - While swap-free, an administration fee is applied to positions held overnight. Some people may consider this another way of charging swap rates, and some traders may not be comfortable with this model. While there is a grace period of 5 days, it only applies to a few market instruments.

• Manual Activation Required - Traders must request an Islamic account. It is not automatically assigned.

Setting Up an Islamic Account

Luckily, setting up an Islamic Account on FP Markets is a straightforward process. To complete this process, a trader first needs to download and set up an account on MetaTrader 4 or MetaTrader 5. The second step involves account conversion to an Islamic account. You can do this by sending personal details and documentation to [email protected]. 

FP Markets may request additional proof before allowing the Islamic trade privileges. Where there is no mention of religion on the identification documents, FP Markets may require you to attach a letter from your mosque confirming your religion.

Credibility of FP Markets

FP Markets has established itself as a reputable and credible broker since its founding in 2005. The broker operates under the regulation of a variety of financial organisations. These include the ASIC in Australia, the CySEC in Cyprus, the FSCA in South Africa, and the CMA in Kenya, among others. This strong regulatory background further enhances the appeal of its Islamic account offering.

Moreover, this broker enjoys great ratings from traders online. At the time of writing this, FP Markets has an impressive 4.9 out of 5-star rating on Trustpilot after over 8,400 reviews. Such high ratings generally demonstrate a high level of user satisfaction.

Final Comments

FP Markets offers a well-structured and Sharia-compliant trading solution for Muslim traders through its Islamic account. The broker offers swap-free status on both Standard and Raw MT4/MT5 accounts, access to a wide range of instruments, and competitive trading conditions. This allows FP Markets to balance religious compliance with high-performance trading features.

However, it’s important for potential users to consider the administrative fees on some instruments, especially for long-term trades. It's also important to note that swap-free access is not automatic and requires manual approval. Despite these minor drawbacks, the transparency, credibility, and robust regulatory oversight of FP Markets make its Islamic account a strong option for Muslim traders.

72.44% of retail CFD accounts lose money