Shariah investments

Shariah investments are a way of investing money according to the principles of Islam. These principles involve ensuring that investments are made in ethical and socially responsible ways that do not go against Islamic teachings.

For example, according to Shariah law, investing in companies that sell alcohol, tobacco or engage in gambling is considered forbidden. Similarly, investments in companies that engage in riba or usury (charging interest on loans) are also considered not allowed.

Therefore, shariah investments are those that are made in line with these principles, and are designed to help Muslims invest in ways that are consistent with their beliefs and values.

To make sure that the investment complies with Shariah principles, companies undergo a screening process that involves an assessment of their business activities, financial ratios and business practices. The screening process is conducted by Shariah experts, who are well-versed in Islamic laws and principles.

After the screening process, investors are then able to invest their money in Shariah-compliant investments, such as mutual funds, ETFs or individual stocks that meet the criteria.

Overall, Shariah investments offer Muslim investors an opportunity to invest their money in a way that aligns with their values and beliefs, while still having the potential to earn returns on their investments.