Question
ADIAs capital market department is conducting interviews for an analyst position. The main role entails finding profitable investment opportunities for both short-term and long-term investing.
ADIAs capital market department is conducting interviews for an analyst position. The main role entails finding profitable investment opportunities for both short-term and long-term investing. One of the questions in the interview is related to the hike in GameStop share price during the last few months. An important element of the rise in GameStop price was the initial shorting of stock and subsequent response of investors to this shorting (short sale). The interviewer asked you about the appropriateness of profits earned by shorting from a conventional finance perspective well as from an Islamic finance perspective. Please provide your detailed response to this question by elaborating whether investing by shorting in GameStop is shariah-compliant or not. Please provide complete details as to why or why not it is shariah-compliant by referring to various elements of shorting and their shariah compliance.
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