Until now banks and fund companies thought that the demand for Sharia funds in Sweden was too small, but after inquiries from customer who wanted a Sharia fund, fund company Selector Management registered Sweden’s first Sharia fun at the end of July. Starting today Avanza Bank offers the fund to its customers.
Claes Hemberg of Avanza Bank says that their customers have been asking for a Sharia fund for a long time. The Dow Jones Islamic market index was started ten years ago and it was only a matter of time until Sharia funds came to Sweden.
The fund is called ‘Selector world shariah value’ and is a global fund of 110 companies from all over the world. The companies have been chosen based on Islamic criteria by the Dow Jones Sharia Board, which is composed of five imams from various countries. The companies don’t trade in weapons, alcohol, porn, banks of other financial institutions.
The Sharia Board approved 2,600 companies, of which several are Swedish, but none of the 110 companies in the fund are Swedish.
Carl Ghatan, Selector’s representative in Sweden, says that they started up the fund because there’s a group in Swedish who don’t have any investment alternative. They hope it will be offered to customers in the ten European and Asian countries Selector serves, and be accessible even in other places.
The Islamic Association in Stockholm believes that the fund will be a success. Head Abdallah Salah says that there’s a giant demand for such a fund and other Muslim bank services in Sweden and that there are barely any Muslims who have actively chosen their pension savings. But now many Muslims could move their pension plan to a Sharia fund instead. And there are many companies with Muslim bosses who will invest in funds.
Jonas Lindmark, analysis head of Morningstar fund anal ysis company, says that it’s strange that there haven’t been Sharia funds in Sweden earlier. He thinks one reason that there hasn’t been such a strong demand is that many Muslims keep their savings within the family and it would be interesting to see what happens with the new fund. If it would be a success, it’s probably other banks will follow suit.
Source: DN (Swedish)