A Jurisprudential Feasibility Study of Designing Equity Swap in Proportion to the Iranian Capital Market

Swap contracts, as a kind of derivative instruments, are of high importance and usage in financial markets. One widely-used sort of them is equity swap contract. As the Iranian financial market is developing, it is needed that all new instruments be assessed by jurisprudential standards. In this article, besides examining equity swap contract with regard to its different definitions, sorts, features, models, applications, advantages, disadvantages, and the necessity of its being used in the Iranian financial market, we have assessed its jurisprudential and juridical aspects for the first time. Examining the jurisprudential aspect of equity swap contract using a descriptive-analytical and documentary approach, this article tries to prove the hypothesis that although such a contract in proportion to Iranian financial market is not amendable due to the presence of usury in the form of Bai and Muawadah, it may be designable through "exchange of two contracts".