Sukuk investment certificates are comparable to bonds, but they aren’t dependent on debt, hence they’re halal. Interest payments on debt due are seen as usury, exploitative of the debtor, and are thus prohibited under Islamic teachings (haram). As a result, conventional bonds and other debt products that earn interest revenue are prohibited under Islamic rules. Sukuk investments are halal since they aim to profit from the underlying assets’ investment income rather than interest and principal payments. Sukuk may look to be similar to bonds on the surface: They have maturities, can be evaluated by major credit rating agencies like S&P or Moody’s, and earn regular investment income payments, comparable to the coupon payments from traditional bonds. So, what distinguishes halal sukuk investments? They must meet the CORE Criteria listed below.
Are bond funds considered halal?
Halal investing entails making investments in firms that follow Islamic investing guidelines. Many traditional investment products are non-compliant. Profiting from debt, for example, is forbidden, so observant Muslims cannot invest in bonds or GICs. Halal investing also prevents firms from profiting from certain activities, such as alcohol, cigarettes, gambling, pork, and weapons.
Is it possible to buy bonds in Islam?
Bonds fall under this category, and as a result, Muslim investors are prohibited from purchasing them. One of the reasons why Muslim investors in the financial markets favor stock investments over other types of investments is the prohibition of riba.
Is it permissible to invest in cryptocurrency?
The national council of Islamic experts in Indonesia has declared cryptocurrency trading, such as Bitcoin, to be prohibited for Muslims, as the popularity of digital currencies surges in the world’s largest Muslim-majority country.
Is Forex considered halal or haram?
Forex trading can be both halal and haram, depending on the investor’s aim and behavior. Trading with an Islamic account and a good strategy is halal, however trading with a standard account and no system is deemed gambling and haram.