The best Sharia-compliant ETFs

How to invest in Sharia-compliant companies using ETFs

0.30% p.a. - 0.75% p.a.
annual total expense ratio (TER) of Sharia-compliant ETFs
on Sharia-compliant companies, which are tracked by ETFs
on Sharia-compliant companies
 
The best indices for Sharia-compliant ETFs

How do I invest in Sharia-compliant companies?

The Sharia includes all religious and legal principles, mechanisms for setting norms and rules for the interpretation of the Islamic belief. From the religious practice, rules which are applicable to investments in global capital markets can be derived.

These rules can also be applied to indices. Since income from loans is considered incompatible with Sharia law, Western financial companies are usually excluded from such indices. Companies also have to demonstrate a certain degree of stability and therefore must not exceed defined limits of indebtedness or leverage. Additionally, there are several exclusion criteria for non-Sharia-compliant industries and sectors which are very similar to sustainable indices. As a result, Sharia-compliant indices contain a large number of companies from the healthcare and technology sectors. The index guidelines are monitored by an advisory board of renown Sharia experts.

In this investment guide, you will find ETFs that offer access to Sharia-compliant investment. Currently, there are 10 indices available tracked by 10 ETFs.
 

MSCI World Islamic performance

1 month: 3.40%
1 year: 14.33%
3 years: 42.90%
5 years: 64.57%
 

Sharia-compliant ETFs in comparison

The most important factors at a glance

When choosing a Sharia-compliant ETF one should consider several other factors in addition to the methodology of the underlying index and performance of an ETF. For better comparison, you will find a list of all Sharia-compliant ETFs with details on size, cost, age, income, domicile and replication method ranked by fund size.

Compare all Sharia-compliant ETFs in detail
Compare all Sharia-compliant ETFs in a chart

Provider
ISIN
  Fund size
in m GBP
TER
in %
Use of profits Fund domicile Replication method
iShares MSCI World Islamic UCITS ETFIE00B27YCN58 421 0.30% p.a. Distributing Ireland Full replication
iShares MSCI Emerging Markets Islamic UCITS ETFIE00B27YCP72 188 0.35% p.a. Distributing Ireland Full replication
iShares MSCI USA Islamic UCITS ETFIE00B296QM64 159 0.30% p.a. Distributing Ireland Optimized sampling
HSBC MSCI World Islamic ESG UCITS ETF USD (Acc)IE000X9FTI22 31 0.30% p.a. Accumulating Ireland Full replication
HSBC MSCI Emerging Markets Islamic ESG UCITS ETF USD (Acc)IE0009BC6K22 18 0.35% p.a. Accumulating Ireland Full replication
HSBC MSCI USA Islamic ESG UCITS ETFIE000I5NV504 10 0.30% p.a. Accumulating Ireland Full replication
HANetf Saturna Al-Kawthar Global Focused Equity UCITS ETF AccIE00BMYMHS24 10 0.75% p.a. Accumulating Ireland Sampling
HSBC MSCI Europe Islamic ESG UCITS ETF EUR (Acc)IE000AGFZM58 9 0.30% p.a. Accumulating Ireland Full replication
HSBC MSCI Japan Islamic ESG UCITS ETF USD (Acc)IE0001XCFC82 9 0.30% p.a. Accumulating Ireland Full replication
Invesco Dow Jones Islamic Global Developed Markets UCITS ETF AccIE000UOXRAM8 - 0.40% p.a. Accumulating Ireland Full replication

Source: justETF.com; As of 24/02/2024

 

Return comparison of all Sharia-compliant ETFs

The table shows the returns of all Sharia-compliant ETFs in comparison. All return figures are including dividends as of month end. Besides the return the reference date on which you conduct the comparison is important. In order to find the best ETFs, you can also perform a chart comparison.

ETF   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
HSBC MSCI USA Islamic ESG UCITS ETF 0.58% 10.30% 6.87% 19.90% -
Invesco Dow Jones Islamic Global Developed Markets UCITS ETF Acc 1.40% 11.86% 6.34% 17.84% -
iShares MSCI USA Islamic UCITS ETF 0.24% 7.55% 4.90% 15.61% 53.65%
HANetf Saturna Al-Kawthar Global Focused Equity UCITS ETF Acc 2.03% 12.61% 8.85% 15.40% 7.24%
HSBC MSCI World Islamic ESG UCITS ETF USD (Acc) 0.27% 10.43% 6.08% 15.23% -
iShares MSCI World Islamic UCITS ETF -0.14% 7.95% 4.47% 11.99% 42.44%
HSBC MSCI Europe Islamic ESG UCITS ETF EUR (Acc) -1.62% 11.06% 4.26% 8.60% -
iShares MSCI Emerging Markets Islamic UCITS ETF -2.45% 5.77% -0.30% 0.58% -7.03%
HSBC MSCI Emerging Markets Islamic ESG UCITS ETF USD (Acc) -3.50% 4.07% -2.51% -1.59% -
HSBC MSCI Japan Islamic ESG UCITS ETF USD (Acc) 3.90% 15.52% - - -

Source: justETF.com; As of 31/01/2024; Calculations in GBP including dividends