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jimbo123
01-16-2011, 12:26 PM
The two things I've learnt is that (correct me if I am wrong):

1. We are not allowed to buy shares in companies that deal with haram things like alcohol, drugs and pornography etc.
2. Companies that deal with interest.

I was looking at buying shares in shariah compliant companies and saw Amana Growth and Amana Income. Apparently, in their portfolio they have companies like Nike and Apple. How does Amana know if these companies deal with interest or not?

I would have thought that most of these big western companies borrows lots of money from the bank?
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ardianto
01-18-2011, 04:33 PM
:sl:

There is difference between deal with interest as creditor (party that gives loan) and debtor (party that take loan).

Have shares from companies that deal with interest as creditor is not permissible. That's why conventional banks never appear in Islamic Index. But have shares from companies that deal with interest as debtor ?....... I don't know. You must ask a Muslim who expert in Sharia with specialization in Islamic finance and trading.

But from my knowledge, Muslim finance companies, including mutual funds companies, always have Sharia consultants. And if Nike and Apple are on portfolio, that's because those companies are considered as halal companies.

By the way, I found at least three Indonesian companies in portfolio, Telekomunikasi Indonesia (telecommunication), Kalbe Farma (pharmacy) and Semen Gresik (cement).
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jimbo123
01-18-2011, 10:13 PM
I don't know much about finance stuff and sharia rulings - I have a very basic understanding. I know that they have Sharia consultants but... apparently the Islamic Bank of Britain had sharia consultants as well but a lot of people say that that bank isn't 100% halal.
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ardianto
01-19-2011, 02:06 AM
Originally Posted by jimbo123
I don't know much about finance stuff and sharia rulings - I have a very basic understanding. I know that they have Sharia consultants but... apparently the Islamic Bank of Britain had sharia consultants as well but a lot of people say that that bank isn't 100% halal.
I heard that too.
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jimbo123
03-19-2011, 07:04 PM
I need some advice about this pronto. I've asked at my masjid, they told me to get advice from the local Shariah council. They are not responding to any of my emails.

Who is the best person to talk to about this?
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aamirsaab
03-19-2011, 08:23 PM
Originally Posted by jimbo123
I need some advice about this pronto. I've asked at my masjid, they told me to get advice from the local Shariah council. They are not responding to any of my emails.

Who is the best person to talk to about this?
To cut a very long story short, it's perfectly fine to invest money in Amanah funds. I've a degree in Islamic Banking and Finance, so feel free to ask any questions on the matter.
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jimbo123
03-19-2011, 10:53 PM
Originally Posted by aamirsaab
To cut a very long story short, it's perfectly fine to invest money in Amanah funds. I've a degree in Islamic Banking and Finance, so feel free to ask any questions on the matter.
I was going to PM you but then I thought maybe others can benefit from the info in this thread.

So Amana puts money into a lot of different companies. Is it an issue if these companies deal with interest?

As a potential investor, what should I look for to make sure I buy something shariah compliant? It's easy to figure out whether a company deals with alcohol, pornography, arms etc but what about financial dealings?
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aamirsaab
03-19-2011, 11:42 PM
Originally Posted by jimbo123
I was going to PM you but then I thought maybe others can benefit from the info in this thread.

So Amana puts money into a lot of different companies. Is it an issue if these companies deal with interest?

As a potential investor, what should I look for to make sure I buy something shariah compliant? It's easy to figure out whether a company deals with alcohol, pornography, arms etc but what about financial dealings?
In an ideal world, we should avoid companies that deal in interest (not just because Islam says so, either). But, what we all need to understand in general is the global economy is run on interest (from minor to major economical transactions, they all involve a level of interest), so in this case dealing with interest, particularly in terms of shares etc, it's unavoidable. So in that regard, it's ok to invest in such companies (and the use conventional banks).

Most conventional banks are actually sharia compliant. The only real real hard-line clear-cut difference between conventional and Islamic banks is simply how each of them invest their money into other companies (Islamic banks can't invest in the ones you've already stated); otherwise they are essentially the same.
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