Islamic Ideology
Islam bullish in a bear market
By Grace Wyler
Newsweek, Jul 28, 2008
The big winners in faith funds (if you can be so crass) are the Islamic funds. They screen out "sin stocks"— and producers of pork products. The profitable difference is riba, or interest. The Qur'an strictly prohibits the borrowing or lending of money at interest: "Whatever you give as riba so that it might bring increase through the wealth of other people will bring you no increase with Allah," it says. Because of this prohibition, Islamic mutual funds, like those in the Amana group, don't invest in financial-services companies: they escaped the subprime mortgage debacle altogether. Most energy companies, however, are fine. "We don't consider ourselves an environmental or socially responsible fund," says Monem Salam, Amana's director of Islamic investing. "Energy was a big part of our growth." Over the past year, the Amana funds outperformed the market; their assets have more than doubled from $400 million in 2003 to $1.3 billion this year. Five years ago, most of Amana's investors were American Muslims, Salam adds. Now, he guesses, 80 percent of new investors are non-Muslims.
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9:46 PM
Moderate Islamist here
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