Comment by KPGv2

11 hours ago

One presumes it's because a huge amount of its revenue comes from defense contracts, which are haram. Here is n excerpt from the fund's exclusion criteria:

> S&P 500 Shariah Industry Exclusions. The index universe consists of all the constituents in the S&P 500 Shariah, excluding companies classified as part of GICS sub-industries 20101010 (Aerospace & Defense), 40203040 (Financial Exchanges & Data), 40201060 (Transaction & Payment Processing Services).

4 comments

KPGv2

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throwaway2037  10 hours ago

That is wild. Saudi Arabia which is governed by sharia law spends about 7% of its GDP per year on its military. I had no idea that ownership of defense contractors is considered haraam.

  • DaedalusII  9 hours ago

    opinions vary, but this was the opinion adopted when formulating this index

    it probably makes it easier to ship in europe where some private banks and pensions (eg denmark gov) ban defence investment

    • throwaway2037  2 hours ago 

          > the opinion adopted when formulating this index

      You raise an excellent point. I did a little bit of Googling and discovered:

          > S&P Shariah indices ... are overseen by an independent Shariah Supervisory Board consisting of a panel of internationally renowned Islamic scholars. This board is facilitated by Ratings Intelligence Partners, a London and Kuwait-based Islamic finance advisory firm.

      Ref: https://www.ratingsintelligence.com/