Learn Trading — Answers for Pakistan's Traders
Clear, sourced answers to the questions traders in Pakistan ask most: is forex legal, is crypto halal, how to invest in PSX, KMI-30 and more — in English and Urdu.
Pakistan Stock Exchange
Should I invest in mutual funds or buy PSX shares directly?
Mutual funds pool many investors' money and a licensed asset manager invests it, so you get diversification and professional management for a fee. Buying PSX shares directly…
How do dividends work on the Pakistan Stock Exchange?
A PSX company announces a dividend with its results, quoted as a percentage of the share's face value (usually Rs 10) or in rupees per share. Shareholders on the company's…
How can overseas Pakistanis invest through a Roshan Digital Account?
A Roshan Digital Account (RDA) is a bank account that non-resident Pakistanis open online from abroad with a Pakistani bank, in foreign currency or rupees. From it you can invest…
What is the KSE-100 index?
The KSE-100 is the main benchmark index of the Pakistan Stock Exchange. It tracks 100 listed companies weighted by free-float market capitalisation: the largest company from each…
How do I start investing in the Pakistan Stock Exchange (PSX)?
To invest in the Pakistan Stock Exchange, open an account with an SECP-licensed PSX broker (a TREC holder), complete KYC with your CNIC and bank details, and the broker opens a…
What is the KMI-30 index?
The KMI-30 is the Pakistan Stock Exchange's index of 30 Shariah-compliant companies, chosen by free-float market capitalisation and liquidity after passing Shariah screening for…
Technical analysis
What are candlestick patterns and how do you read them?
A candlestick shows four prices for one period — open, high, low and close. The body spans open to close and the wicks show the extremes, so one candle reveals who controlled…
What is Fibonacci retracement and how do you use it in trading?
Fibonacci retracement is a charting tool that divides a price move into ratios — mainly 23.6%, 38.2%, 50%, 61.8% and 78.6% — to estimate where a pullback might pause before the…
What is a moving average and how do traders use it?
A moving average is the average closing price over a set number of periods, recalculated each period so it "moves" with the chart. It smooths out noise to show the direction of…
What is the RSI indicator and how do you use it?
The Relative Strength Index (RSI) is a momentum indicator, created by J. Welles Wilder in 1978, that compares the size of recent gains with recent losses on a scale from 0 to…
What are support and resistance levels, and how do you draw them?
Support is a price area where buying has repeatedly stopped a decline; resistance is an area where selling has repeatedly stopped a rise. They work because many traders remember…
Crypto
How do I buy USDT in Pakistan safely?
Most Pakistanis buy USDT through the peer-to-peer (P2P) market of an exchange that holds a PVARA No-Objection Certificate, paying the seller by bank transfer, JazzCash or…
What is Bitcoin and how does it work?
Bitcoin is a digital currency that runs on a public network of computers instead of a bank or government. Transactions are recorded on a shared ledger called the blockchain, and…
Is crypto legal in Pakistan?
Yes — owning and trading cryptocurrency is not illegal in Pakistan. The Virtual Assets Act, 2026 made the Pakistan Virtual Assets Regulatory Authority (PVARA) the permanent…
Forex
How do prop firms and funded trading accounts work for Pakistani traders?
A prop firm sells you an evaluation ("challenge") for a fee. If you hit a profit target without breaking its loss limits, you get a "funded account" and keep a share of profits,…
How is the dollar rate in Pakistan decided?
Pakistan has a market-based exchange rate: banks trade dollars with each other in the interbank market, and that rate moves with the supply of dollars (exports, remittances, IMF…
What is forex trading and how does it work?
Forex (foreign exchange) trading means buying one currency and selling another at the same time, hoping the exchange rate moves in your favour. Currencies trade in pairs such as…
Halal or haram
Is investing in the share market (PSX) halal or haram?
Most scholars, including Mufti Taqi Usmani, hold that buying shares is halal when the company's main business is permissible, you object to any interest it deals in, you purify…
Is crypto trading halal or haram?
Scholars disagree. In June 2026 Jamia Darul Uloom Karachi, in a fatwa signed by Mufti Taqi Usmani and five other scholars, ruled that buying and selling cryptocurrencies —…
Is forex trading halal or haram?
Exchanging one currency for another is halal when both amounts change hands on the spot (taqabud) with no interest. Typical online forex trading is different: it uses leverage,…
Rules & regulation
How can I avoid trading and investment scams in Pakistan?
Deal only with platforms licensed by the SECP, PMEX or PVARA, and verify the licence on the regulator's own website — never through a link the seller sends. Walk away from anyone…
What is PMEX and what can you trade on it?
PMEX, the Pakistan Mercantile Exchange, is Pakistan's only futures exchange regulated by the SECP. Through a registered PMEX broker you can trade futures on gold (including…
Is forex trading legal in Pakistan?
Forex trading is legal in Pakistan when it goes through regulated channels: banks and exchange companies licensed by the State Bank of Pakistan (SBP), and SECP-regulated venues…
Risk management
How do I set a stop-loss and decide how much to buy?
Decide first how much of your account you are willing to lose on one trade — many traders use 1%. Place the stop-loss where your trade idea is proven wrong, not at a random…
What is trading psychology, and how do you control emotions when trading?
Trading psychology is how emotions and mental biases affect trading decisions. Most damage comes from a few predictable patterns: holding losers too long and selling winners too…
What is leverage in trading, and why is it risky?
Leverage means trading a position larger than the money in your account, using the broker's or exchange's funds. With 1:100 leverage, Rs 10,000 controls a Rs 1,000,000 position,…
Trading basics
What is the difference between swing trading and scalping?
Swing trading means holding positions for several days to a few weeks to catch one price "swing" in a trend, using daily or 4-hour charts. Scalping means taking many very small,…
What is day trading, and can you day trade on the Pakistan Stock Exchange?
Day trading means buying and selling within the same trading day, closing every position before the market shuts so nothing is held overnight. On the Pakistan Stock Exchange you…