Halal Investing for Beginners

An intuitive and eye-opening guide to halal investing

In Halal Investing for Beginners: How to Start, Grow and Scale Your Halal Investment Portfolio, a team of Oxford-educated Islamic finance gurus deliver a one-of-a-kind investing roadmap for Muslims who want to watch their savings grow while abiding by Islamic law. You’ll learn to distinguish between halal and haram investment products, get key strategies for saving on your taxes, learn to build a variety of portfolios, and more.

In the book, the authors introduce and explain the wide variety of investment products available to investors who wish to restrict their financial activity to that which is consistent with Shariah law, including asset categories like equities, gold, art, start-ups, and even property. You’ll also find:

• Advice for every stage of life, including how to go halal for the first time, how to write an Islamic will, and how to build a halal pension
• Portfolio construction guidance for every risk tolerance, from high-growth to low risk
• Explanations of the important difference between “ethical” and “ESG” investment products and halal investments

An essential resource for Muslims who seek to invest while remaining true to their faith and values, Halal Investing for Beginners is the intuitive and easy-to-follow investment tutorial that everyday Muslims have been waiting for.

Foreword ix

Acknowledgements xi

About the Authors xiii

Introduction xv

Part I The Basics of Investing and Personal Finance 1

Chapter 1 Personal Finance Essentials 3

Chapter 2 Breaking Even 5

Chapter 3 Islamic Wills 13

Chapter 4 Pensions 17

Chapter 5 Your Rainy Day Fund 21

Chapter 6 Going Halal for the First Time and the Purification of Wealth 27

Part II How to Develop Your Investment Strategy 35

Chapter 7 Your Investment Mindset 37

Chapter 8 Building the Blocks 51

Chapter 9 How to Do Basic Due Diligence into an Investment Company 71

Chapter 10 Tax-Saving Strategies 77

Chapter 11 Weighing up Risk and Reward 81

Part III Investment and Sharia Considerations for Popular Investment Categories 87

Chapter 12 Stocks 89

Chapter 13 Fixed Income 121

Chapter 14 Alternative Assets 153

Part IV How to Construct a Robust Portfolio 211

Chapter 15 Portfolio Theory 213

Chapter 16 Case Study: Conservative 221

Chapter 17 Case Study: Moderate 225

Chapter 18 Case Study: Aggressive 229

Parting Thoughts 231

Notes 233

Continuing Your Education 243

Helpful Resources 245

Index 247

Ibrahim Khan is a co-founder of Islamic Finance Guru, a UK-based Islamic investment platform. He read PPE at Oxford before going into corporate law. He holds an Alim degree as well as an MA in Islamic Banking from the University of Gloucestershire. He loves venture investing.

Mohsin Patel is a co-founder of Islamic Finance Guru. He is an Oxford graduate, a former corporate lawyer and a Forbes 30 Under 30 alumnus. He is an active investor across multiple asset classes and has established several family businesses.

Many Muslim investors remain unaware that most of the conventional investment products marketed as “ethical” or “ESG” do not qualify as halal investments. And the challenges that many of these investors face in accurately identifying those investments permitted by Islamic law and those that are prohibited persist. An easy-to-follow and intuitive roadmap for Muslim investors is sorely needed.

In Halal Investing for Beginners: How to Start, Grow and Scale Your Halal Investment Portfolio, a team of distinguished Islamic finance experts delivers a singular and hands-on guide for practicing Muslims who want to save for their futures while staying true to their faith and values at the same time. In the book, you’ll find answers to the questions you’ve always had about investing, including how to distinguish between halal and haram investment funds.

The authors introduce and explain the large number of halal investing opportunities available to Muslim investors, in asset categories including equities, gold, art, start-ups, and even property. You’ll explore fixed income, property, and stock funds, as well as how to construct a variety of portfolios—from low-risk to high-growth.

Halal Investing for Beginners walks you through how to pick halal stocks, how to invest in real estate, exchange-traded funds, cryptocurrencies, and halal digital assets, how to participate in angel investing, and taking out Islamic mortgages and pensions.

From going halal for the first time and purifying your wealth to writing an Islamic will and setting up an Islamic pension, this book takes you through every relevant life stage, risk tolerance, and portfolio construction that may apply to you and your family. It’s ideal for every Muslim who hopes to watch their savings grow while abiding by Islamic law.

Praise for Halal Investing for Beginners

“I started skimming the book, only to find myself slowing down and reading through most of it. This is a long-overdue practical and user-friendly guide to investing in the modern world, intended for Muslims conscious of their faith and values. An amazing and necessary resource for every Muslim household.”
—Dr. Yasir Qadhi, prominent Islamic scholar and academic

“This book is a handbook to explain to the average Muslims the basics of investments and how to be an investor. The practical approach of the book and the easy style of it are among its main advantages. I pray that Allah puts barakah in this book and make it a source of benefit for our brothers and sisters.”
—Dr. Haitham Al-Haddad, Chairman of the Islamic Council — UK

“With clear explanations and practical tips, this book is a must-read for anyone looking to build a halal investment portfolio.”
—Mufti Faraz Adam, Global Head of Sharia Consultancy Amanah Advisors

“In a world where the traditional Islamic finance industry has disappointingly focused on serving society’s wealthiest, Ibrahim and Mohsin have instead blazed a trail and taken back control for ordinary Muslims. Their grassroots movement is unique in educating and entertaining Muslims on managing their money in a halal way. This book distils their eight-year journey and is essential reading.”
—Harris Irfan, former Global Head of Islamic Finance at Barclays; author of Heaven’s Bankers