Document Type : Original Article
Authors
1
َAssociate Professor, Accounting Department,, Faculty of Economics, Management,and Administrative Sciences, Semnan University, Semnan, Iran.
2
Associate Prof.Department of Economics, Faculty of Economics, Management and Administrative Sciences, Semnan University, Semnan, Iran
3
Ph.D. Candidate in Finance - Financial Engineering, Faculty of Economics, Management and Administrative Sciences, Semnan University, Semnan, Iran.
10.22034/aafie.2024.466221.1044
Abstract
The primary aim of this research is to examine the nature of the Chooser option and its jurisprudential analysis within the framework of Islamic principles and foundations. The Chooser option is a type of option that allows its holder to decide, at a specified time in the future, whether the contract will be executed as a call or put option, with an agreed price and maturity date. In this study, after elucidating the nature of the Chooser option, the research employs the customary ijtihad-based analytical method used in examining Islamic financial instruments to assess the legitimacy of this novel financial tool within the framework of Islamic jurisprudence. Two main approaches have been utilized: first, the affirmative approach, which is based on the principles of "Asalat al-Luzum" and "Asalat al-Sihha," and second, the comparative approach, which examines the conformity of the conditions of the Chooser option with other Sharia-compliant contracts such as Bay' and Sulh. The paper also addresses the jurisprudential doubts and challenges related to this type of transaction and, through a precise analysis of the arguments for and against it, evaluates the possibility of its legitimacy within the framework of Islamic law. The findings indicate that the Chooser option, given its unique features and conditions, can be legitimized within the framework of contracts such as Bay' al-Haqq, Sulh, Ju'alah, and Shart Ibtida’i, and is capable of being traded in Islamic capital markets.
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