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May 09, 2021
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Halal investing not only satisfies Islamic principles, but can also be just as profitable as conventional investing.
You may have heard that as a Muslim, you must follow certain religious principles when investing, and you must only stick to halal investments.
But why is there a need for Islamic investing, and how would you know which investments are considered halal?
To unravel the mystery, it is important first to understand how Islam views finance.
In the Islamic faith, money is viewed as having no intrinsic value; it is regarded only as a medium of exchange, with one unit equivalent to another of the same denomination (i.e., $1 = $1).
Halal investing in Canada
By Jason Heath on December 18, 2020
Investing can be challenging for Muslims, as solutions that are both Shariah-compliant and effective at helping achieve long-term financial goals are limited.
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Canadian Muslims have unique constraints when looking for investment options that fit their religious beliefs, and many mainstream options are unsuitable for these investors.
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The Quran is the Islamic text that guides all aspects of Muslim life. Shariah is the Islamic law that includes guidelines that impact financial decisions for Muslims; these include the prohibition of earning interest from fixed-income investments like bonds, which are a common component of an investment portfolio. Instead of earning interest from lending (a bond is a loan from the investor to the bond issuer), a borrower and lender should share in risks and rewards (like investing in stocks).