Halal/ Shariah Compliant Trackers

Magginnis

Hi,
I would like to invest some money (approx 1 k per month) into a global tracker (as a SIPP). Is anyone aware of any shariah compliant options pls?
I quite like the vanguard FTSE global all cap.
I understand that thee may not be anything which is very similar to this, but anythng shariah compliant along the same sort of lines would be really good.
Something which I could leave for about 20 yrs without messing about with too much.
Many thanks for advice!

Alistair31

Pardon my ignorance but would you mind explaining what makes an investment shariah compliant and what would happen if you were to invest other wise.

cloud_dog

You do know 'Google' is your friend, don't you.

Have a look at this site. I'm not vouching for the contents but it provides some info on the subject.

Paul_DNAP

Alistair31 wrote: »

Pardon my ignorance but would you mind explaining what makes an investment shariah compliant and what would happen if you were to invest other wise.

As I understand it, making a profit from money lending is against basic principles of Islam (money itself has no value, it should always be used as a fair means of exchange).

I was sure there used to be a section on compliant accounts in the saver/investing guides, but I can't locate it today, maybe it's gone.

ColdIron

Pickings are slim

You might look at the iShares MSCI World Islamic UCITS ETF (ISWD) from Blackrock available at HL
https://www.hl.co.uk/shares/shares-search-results/i/ishares-ii-plc-msci-world-islamic

You would need to watch trading fees for ETF's, at the £1,000 a month level you might be better buying in every few months to limit fees

There is also the HSBC Amanah Global Equity Index Fund, presumably available at HSBC

There are a few indexes such as the FTSE Shariah Global Equity Index, your task would be finding something that tracks it. The plus side of these indexes is they should have no or only incidental fixed interest

You could look at ethical funds for a wider choice, obviously some of these may not fit your remit but in my experience this is somewhat fluid anyway. My old manager was very devout (Zakat, Hajj etc) but had no problem with investing in BAE Systems. It's between you and your god

xylophone

https://www.tamassetmanagement.com/tam-sharia-compliant-portfolios,331.html

https://www2.trustnet.com/Education/ShariahLaw.aspx

may be worth a look.

Reaper

Paul_DNAP wrote: »

As I understand it, making a profit from money lending is against basic principles of Islam

Not quite, here is my understanding. Fixed interest is out because that is straight money lending. However sharing in the risk and sharing a profit is ok. For that reason compliant savings accounts do not offer guaranteed returns, instead they offer "projected profits" but the saver accepts the risk because it is not guaranteed.

Investing in shares is OK because you are very much sharing the risk and rewards.

The focus then turns to whether you investing in firms that are acceptable - e.g. gambling firms and alcohol manufacturers would be out.

Hence why the OP is looking for a tracker that only includes sharia compliant companies.

Paul_DNAP

Many Thanks.

londoninvestor

You might be interested in Waheed Invest (see previous thread here). This is a sharia-compliant "robo-adviser" (kind of a halal Nutmeg if you like).

Using their service will obviously add some cost, because they take a cut - but at the very least, having a look round their site is useful. They're transparent about what funds and assets go into their portfolios at each risk level, so it might give you some ideas about funds you could invest in.

Magginnis

Many thanks guys, Some really helpful advice

Magginnis

Thanks ColdIron
Would you know are the iShares MSCI World Islamic UCITS ETF (ISWD) available through anyone else other than HL please? Its just HL charges are relatively expensive.
Thanks