It is time to get to know one of your most important investments, your super. In this article you will learn about what makes your super Islamic and how we invest Islamically, straight from our portfolio management team.
Did you know that over 1/3 of your super may fund industries against your values?
You might be surprised but the receiving of interest is strictly forbidden in Islam. If a positive, fixed, predetermined rate is attached to the maturity (i.e. a guaranteed rate regardless of the performance of the investment), it will be considered riba and is prohibited.
Unfortunately, most superannuation funds invest on average 34% of your super in interest-bearing investments, while the remaining investments are conducted without any regard for Islamic investment principles, they invest in industries such as alcohol, pig products and many more sectors that are non-sharia compliant.
At Hejaz, you can be rest assured that your superannuation savings will be invested into a Sharia compliant managed fund, the Global Ethical Fund. By choosing Hejaz Islamic Super services, you are choosing to invest Islamically and in accordance to your values.
The creation of the Hejaz Islamic super service portfolio
This is how we ensure that our portfolio of investments is compliant. Firstly, our Islamic investment experts analyse companies in Australian and overseas share markets (as well as gold and property investments) to create a universe of stocks that passes our strict Islamic investment criteria. Then, our investment team uses this Islamically screened universe to create the Hejaz Islamic Super portfolio. The investment team selects the Islamic stocks they believe will produce superior financial returns. Finally, our portfolio team actively looks for investments that will yield positive returns whilst monitoring current investments.
4 mandatory investment screenings for sharia compliance
- Tainted Income: Income earnt from non Islamic dealings must be below 5% of total revenue.
- Debt/ Market Cap: A company’s debt must not exceed 30% of thier market cap.
- Liquidity: Account receivables should be less than 49% of total assets.
- Business Activity Screens: Businesses such as banks, alcohol, media, interest, military and pig products are not permissible under the Sharia.
At Hejaz we fund industries that are Sharia compliant and industries that help make a better tomorrow, such as healthcare, utilities, technology, telecommunications, infrastructure and property.
So, where are you investing? Is your super fund investing against your values? Is your fund performing?
Put your super in Australia’s Best Performing Islamic Super Option FY19/20*. We invest according to your lifestyle and values and we perform in good and bad times.