Islamic finance

The Sharia wealth management market, called Islamic Finance, is a fast-growing market and is expected to reach more than USD 3.4bn this year with growth of more than 15% net assets.

This particular management uses the basic principles of the Koran and the modern interpretations that have been made. The basic principles are:

- No wear or transaction where one party benefits from the other
- Prohibition to make a transaction on an element that intrinsically presents an uncertain or hazardous character. This principle also applies to certain instruments considered highly speculative
- Prohibition to invest in companies that are in activities deemed non-compliant with Sharia (alcohol, tobacco, banks, insurance, etc.)
- Principle of sharing gains and losses.

As a result, portfolios built on these principles are primarily invested in equities, including the pharmaceutical, industrial and technology sectors. On the other hand, there is no investment in banks or highly indebted companies.

In 2018, these portfolios significantly outperformed the indices, especially in Europe, whose indices were penalized by bank stocks.

Over 5 years, the S & P 500 Sharia index outperformed the S & P 500 index by 3.57% per year.

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