How to Invest Islamically 
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How to Invest Islamically 


There are broadly 6 key criteria that a company must pass in order to be considered Shariah-compliant:

Business

The core business of the company must be halal and in line with the rulings of the Shariah. Investment in securities of any company dealing in conventional banking, conventional insurance, alcoholic drinks, tobacco, pork production, arms manufacturing, pornography, or related activities is not permissible.

Debt To Total Assets

The company’s debt to asset ratio should be less than 37%. Debt in this case is classified as any interest bearing debts. Zero coupon bonds and preference shares are both, by definition, part of debt.

Non-Compliant Investments To Total Assets

The ratio of non-compliant investments to total assets should be less than 33%. Investment in any non-compliant security is included for the calculation of this ratio.

Non-Compliant Income To Total Revenue — Purification Of Non-Compliant Income

The ratio of non-compliant income to total revenue should be less than 5%. Total revenue includes gross revenue plus any other income earned by the company. This amount is cleansed out as charity as a pro rata ratio of dividends issued by the company.

Illiquid Assets To Total Assets

The ratio of illiquid assets to total assets should be at least 25%. Illiquid assets, here, are defined as any asset that the Shariah permits to be traded at value other than at par.

Net Liquid Assets To Share Price

The market price per share should be greater than the net liquid assets per share, calculated as (Total Assets – Illiquid Assets – Total Liabilities) divided by the number of shares.

Please email contact@ethica.institute to arrange a review of your investment portfolio.



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 Boyd Ruff
 Esq., USA          

                                                              

"The course is brilliant."
Mufti Faraz Adam, UK

"I chose Ethica’s certification as it has an excellent reputation in the market and now I understand why. All the different modules cover the most important types of contracts from both a theoretical as well as a practical perspective and are complemented by a lot of clear examples. And the self-paced training permits excellent time management. I recommend the CIFE from Ethica Institute to everybody seriously interested in learning about Islamic finance."
Daniel Rasqui
Director, Product Support and IT, SIX Financial Information, Luxembourg                                                            

"Ethica's program exceeded my expectations. Ethica's certification excelled at offering real world examples and timely tactical instruction in a user-friendly format. I enthusiastically recommend Ethica's program to anyone who seeks to develop an appreciation for and understanding of Shariah-compliant financing."
William R. Gregory
Director, C3 International                                                                        

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