Shariah Investment Planning
What this domain tests
This domain tests screening, purification, asset allocation and product selection across Shariah-compliant equities, sukuk, funds and deposits.
Core rules
- Investments must avoid riba, gharar, maysir and haram sectors. Screening has business-activity and financial-ratio tests.
- Commonly cited AAOIFI-style financial screens include interest-bearing debt below 30% of market capitalization and interest income below 5% of revenue, but thresholds vary by screen. State which standard you use.
- Impure income must be purified by giving the relevant proportion of dividend or income to charity, not by keeping it.
- Sukuk are investment certificates representing ownership in an asset, usufruct or project. Common structures include ijarah, musharakah, mudarabah and wakalah. A sukuk is not automatically compliant if it promises a fixed return like a bond.
- Speculative short selling, conventional options and many derivatives raise gharar and maysir concerns; wa'd and other structures may be used in limited documented cases.
Worked example
A stock passes the business screen but 4% of its revenue comes from interest. The client receives a RM2,000 dividend. Purification is 4% × RM2,000 = RM80, which should be donated. The remaining RM1,920 may be retained. The planner must also check zakat on the shares and disclose that screening is periodic, not once-and-for-all.
Traps
Treating a conventional bond as sukuk; ignoring purification; assuming an "Islamic" fund needs no review; forgetting zakat on shares; and using a single threshold without naming the standard.