Islamic Asset Management: An Asset Class on Its Own?

Islamic Asset Management: An Asset Class on Its Own?

Islamic Asset Management: An Asset Class on Its Own?

Islamic Asset Management: An Asset Class on Its Own?

Synopsis

Many Middle East countries now demand Shariah compliant asset management, which involves a multi-asset allocation strategy that covers both public and private Islamic sukuk securities and equities. Natalie Schoon addresses these complex issues in a way that is accessible to the non-specialist. She reviews types of funds, asset selection, processes, Shariah compliance, and case studies of selected funds, and thoroughly describes the place of asset management within the Islamic finance infrastructure. Readers are shown the prohibitions in Islamic finance that are applied to Islamic funds, continuing developments in the Islamic fund market, and the contemporary structure of Islamic funds.

Excerpt

Islamic, or Sharia‘a-compliant, asset management has been growing at a rate similar to that of the Islamic financial industry as a whole, with at the time of writing close to 700 funds listed in the major databases with estimated funds under management of around 70 billion US dollars. This book reviews the Islamic asset management industry in more detail, including the types of fund offered and their operational procedures. All procedures and processes as well as the fund descriptions are generic and do not represent any particular fund or asset manager.

Fund management fits naturally within Sharia‘acompliant finance since Islam encourages investment and an increase in wealth for all individuals regardless of whether they are rich or poor. For those individuals with lower levels of wealth, who are less likely to be able to invest directly without losing the opportunity to diversify, the ability to invest in funds typically provides an appropriate alternative investment vehicle.

The first chapter of this book contains an overview of the principles, norms and values underpinning Islamic finance. At the risk of repeating content that appears in the other books in this series, this chapter will be of benefit to those who read this book in isolation, and whose understanding of the principles might be minimal. The differences between the different schools of thought within Islam are outside the scope of this book so the generally accepted norms and values associated with (Islamic) business ethics are . . .

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