Apparently, nobody thinks it strange, or hypocritical, that Sharia compliant funds can’t invest in Israeli businesses, while investing in American businesses on a Dutch stock exchange (two countries with military forces in Muslim countries) is completely ok.
Investors in the Amsterdam stock exchange can now also invest in shares that conform to the Islamic rules of the Sharia.
There are three exchange trade funds available: a worldwide fund, a fund specializing in upcoming market and a fund investing in American businesses.
Pure Islamic fund are availalbe in other lands, such as the US and the London exchange. In Amsterdam, Barclays Global Investors listed five new exchange traded funds, or ishares, on Tuesday of which three conform to Sharia. These shares will follow a specified index.
Muslims who want to invest according to laws of sharia, may not put their money into companies that do ‘wrong’ business according to Islamic laws.
The Sharia doesn’t allow investing in companies that produce alcohol, have to do with the sex industry or financial institutions. The latter sector works with interest, riba in Arabic, and Muslims can’t collect it according to Sharia. The funds also don’t invest in companies from Israel.
In order to be certain of the pure character of the indices, Barclays has called in the help of three Islamic scholars, who form the Barclays Sharia Panel. These are Saudi professor of economy Mohammed Elgari, economist Sheikh Niza m Yacuby from Montreal, Canda and jurist Abdul Sattar Abu Dhuddah of Cairo University. They authorized companies that can be invested in.
Investing according to the sharia is interesting also for people who aren’t Muslim in the Netherlands, says Roel Thijssen, head of Barclays iShares Benelux. “Big Dutch banks like ABN Amro and Fortis Mees Pierson, but also fortune administrators, have clients from the Middle East. The development of these three products also comes due to demand that we expect from such parties.”
Posted By Esther to Islam in Europe at 1/23/2008 04:14:00 AM