Identifying Islamic Alternatives to Short Selling in Iran's Stock Market and Prioritizing Them Using TOPSIS

Trading strategies such as short sale and margin trading have an important and undeniable role in the development of capital markets in different countries. However، due to the structure of these contracts and existence of non-religious factors، using these trading strategies in Islamic stock markets has some difficulties. For this reason، financial researchers in these countries، along with Islamic scholars and by implementation of juridical trading strategies، have tried to benefit from aforementioned instruments for the development of capital markets. One of trading strategies that significantly contributes to market liquidity growth is short sale. However، contradiction of using this trading strategy with some principles of Islam has caused the Islamic finance scholars to design a suitable legal mechanism using Islamic contracts. In this paper، we first explain short selling and its benefits and damages. Then، using experts’ opinions and TOPSIS method as well as regarding to legal، financial and juridical criteria adopted، we evaluate and prioritize Islamic alternatives to short selling and finally، we introduce the most proper approach for implementing it in Iran’s stock market.