Shariah investments

[aomar296]

Hi all

Please share what Shariah compliant investments do you guys recommend in the form of unit trusts, ETFs etc

Thanks

 

[Jonny10]

Slms

I believe satrix resi portfolio is a good share to invest in, I'm also doing some research myself, will keep you updated...

 

[supersunbird]

Slms

I believe satrix resi portfolio is a good share to invest in, I'm also doing some research myself, will keep you updated...

As in the Satrix Resources index? It dropped 60% in the past 5 years (just google STXRES), mostly in the past year and a half. If one were to invest in it one would need a very long term outlook, the commodity cycle might easily take 10 to 15 years to go nice and upwards again, in my opinion.

Now onto Shariah compliant investments... sorry, can't help there.

 

[Jonny10]

Yep that's the one, I bought it now BECAUSE it dropped so much, doesn't reflect its true value so I'm hoping it picks up...

 

[saturnz]

Hi all

Please share what Shariah compliant investments do you guys recommend in the form of unit trusts, ETFs etc

Thanks

there are effectively no shariah compliant products thats offered by the financial industry, the lecturer speaks about this issue briefly in the first 10 minutes of this video

[video=youtube;IVxmtb3zTlk]https://www.youtube.com/watch?v=IVxmtb3zTlk[/video]

 

[aomar296]

So whr do you suggest we invest our savings saturn?

 

[saturnz]

So whr do you suggest we invest our savings saturn?

Thats not a question I can answer, but I am a major fan of property.

 

[Jonny10]

Have a look at this link... http://www.fin24.com/Money/Money-Clinic/How-to-diversify-shariah-investments-20110708

 

[Spizz]

So whr do you suggest we invest our savings saturn?

Seems to me that 'Shariah Investment' is a bit of an oxymoron.

Property?

 

[Jonny10]

Seems to me that 'Shariah Investment' is a bit of an oxymoron.

Property?

How so? The investment just needs to comply with certain Islamic laws regarding how one acquires wealth/income. For example, investing in a company which derives its profits from alcohol sales (SABMiller) is a no no.

Many banks are now offering Shariah compliant products.

 

[Spizz]

How so? The investment just needs to comply with certain Islamic laws regarding how one acquires wealth/income. For example, investing in a company which derives its profits from alcohol sales (SABMiller) is a no no.

Many banks are now offering Shariah compliant products.

In my limited understanding, you can't earn interest if you are Muslim. So you call it whatever you want, but investing money in a bank only offers one form of return. Earning money on your money.

If it walks like a duck...

 

[naeem]

gonna copy/paste my answer from another post


Apart from my RA's which work picked out many many moons ago, i have 3 that i contribute to in lump sums every now and then.

http://www.moneyweb.co.za/tools-and-...rustCode=27FA1
27four Shari’ah Active Equity Prescient Fund (A1) 27FA1

http://www.moneyweb.co.za/tools-and-...ustCode=OCIPED
27four Shari’ah Active Equity Prescient Fund (A1) 27FA1

http://www.moneyweb.co.za/tools-and-...rustCode=OCIFD
Oasis Crescent International Feeder Fund (D) OCIFD




The first (27four) being more domestic and the other two property/international based. Both are fairly decent and no real complaints wrt to service. Growth has been good and in line with JSE and the rest of SA stuff. No overnight spikes but consistent upward unit prices.

edit: 27four has been dismal the past few months. Granted the entire market has been poor. They did experience great growth in 2014 and early 2015 though.



There are a few smaller companies doing stuff in property, many are dodgy as hell and took people for millions. Granted they pitched the whole get rich quick scheme which many fall for, along with the 'eggs in one basket' mentality.


There's also a few smaller guys doing livestock investing. ie. group buying of bulls & other animals with the intention to breed and sell the offspring etc. Horrible website. Never used it but looks interesting.
http://www.almabroorprojects.com


There's also these guys: http://www.roshgold.co.za/ - based in Vereeniging. Never used or even read much reviews about them. Know a few of their staff who seem pretty decent and legit. (once again, horrible website)


Then there's the Albaraka Bank who is more conventional banking and offers a few short and long term investments.


As for the Shariah Compliance. Interest issue is just one aspect, the other is of the actual companies one has shares in, they too should not be dealing in interest or forbidden products. Eg SA Breweries is an obvious no no.

 

[Jonny10]

In my limited understanding, you can't earn interest if you are Muslim. So you call it whatever you want, but investing money in a bank only offers one form of return. Earning money on your money.

If it walks like a duck...

That's quite correct, keeping money in the bank to earn interest is not allowed, however investing in equities is a different story - a Muslim would just have to be more selective on what type of equity they invest in.

 

[Hamish McPanji]

In my limited understanding, you can't earn interest if you are Muslim. So you call it whatever you want, but investing money in a bank only offers one form of return. Earning money on your money.

If it walks like a duck...

From what I understand it has to be a shared risk, so no fixed % earnings like a savings or fixed deposit account where you get your 5% no matter whether the bank's investment is successful or not. The investments fail, you lose. The investment does well you win your share.

Another key aspects is the investments need to be in businesses that are not Islamically frowned upon. So Casinos, Breweries, Nightclubs, Pig Farms, Strip Clubs, Interest based banks are all a no no.

I might be wrong though.

 

[aomar296]

Thanks for the excellent post naeem

How are the fees on these unit trusts? Reasonable?

What about ETFs? Any good shariah compliant ones?

 

[Wasabee!]

A samoosa business or spice reseller?

 

[saturnz]

is there an independent governing body of some sort that determines whether a financial product is shariah compliant?

from what I've seen its generally the company itself that tells people its products are shariah compliant.

 

[naeem]

is there an independent governing body of some sort that determines whether a financial product is shariah compliant?

from what I've seen its generally the company itself that tells people its products are shariah compliant.

sorta. Normally they get certifications from a few muslim bodies. Similar to the halal industry.

It does get tricky when they hire their own clerics to certify their own products. That said, the Muslim community in SA is small and in terms of clerics - just about everyone knows everyone. So difficult for one to be 'bought out' and not get exposed. Most of the guys certifying are respected lecturers and imams in various communities and learning institutions.

Off course there will always be difference of opinions and rulings but IMO locally, they all seem above board.

 

[saturnz]

sorta. Normally they get certifications from a few muslim bodies. Similar to the halal industry.

It does get tricky when they hire their own clerics to certify their own products. That said, the Muslim community in SA is small and in terms of clerics - just about everyone knows everyone. So difficult for one to be 'bought out' and not get exposed. Most of the guys certifying are respected lecturers and imams in various communities and learning institutions.

Off course there will always be difference of opinions and rulings but IMO locally, they all seem above board.

I've heard different things.

I've heard of some asset management companies taking prohibited money and donating it to PBOs to get tax refunds and they consider the tax refund as permissible- effectively laundering the money.

 

[naeem]

I've heard different things.

I've heard of some asset management companies taking prohibited money and donating it to PBOs to get tax refunds and they consider the tax refund as permissible- effectively laundering the money.

would love to know more about this, and any names/companies that do this (feel free to msg me)