Financial Education: Investment TIPS for Absolute Beginners

Assalam o alikum all,


Risk comes from not knowing what you’re doing. The most important investment you can make is in yourself” - Warren Buffett

Firstly, a massive thanks to IFG team for doing such a great job for the Muslim community. May Allah reward you all.

I have recently started following the IFG forum and I believe this is an amazing platform. Among others, I particularly like the “Investment Ideas/Chat” category which Ibrahim and Mohsin have nicely described as:

“So often many of our audiences have been working on some deep due diligence into an investment - but that information doesn’t get shared wider than their circle of contacts. We want to change this. This Investment thread is all about chatting about and swapping investment ideas/DD/tips”

I believe that we can only become good investors if we invest in ourselves first by learning. i.e. Financial Education. When I started my journey, everything seemed so complicated, technical and confusing but after investing some time in learning about investing, a lot of things started to make sense and become much more interesting. It seems to me that for us Muslims, there are two steps to follow at high-level.

  • Learn about investing first, then
  • Learn about Islamic products to invest wisely.

Reading through the threads on this forum, I have noted that few of us are just starting the investment journey. Keeping that in context, I would like to share a series of educational videos for “Absolute beginners” prepared by Ramin Nakisa. He has an investment banking background and as a Strategist at UBS, taught traders and advised professional investors on investing strategies. Having a teaching background, I found him quite good at articulating the difficult concepts in an easy to understand way.

(Note: The videos are all about general investing concepts and refer to conventional products. However once we have a better understanding of investing in general, IFG is a great place to Compare Halal Investments)

Common questions that we all ask:

  1. What Returns Should You Expect?

  2. Investing: Do It Yourself or Do It For Me?

  3. How Much Should I Invest for retirement?

  4. How Can I Keep My Investment Fees Low? (Related thread: Comparing Platform Fees)

  5. SIPP vs ISA Which Is Best?

  6. Investing Strategies For Beginners to Advanced

Please DO Let me know your thoughts about this. I am passionate about learning investment and Islamic Finance and quite keen to learn from this community. The more we discuss and share the information/experiences, the better we will become as a community.



This guy Ramin is amazing , i literally have a notebook for his videos to pick up the most important info to me. However the more i dive into investing the more i feel like we are in the 60’s for muslim investors as we barely have any options with very expensive fees , im hoping this will change with time. thanks for sharing !

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Jazakallah for starting the thread and sharing videos from Ramin - I’ll start listening to them.

I’ve read a few investment books and always keep coming back to the same question: non-Muslims always say invest a portion in bonds - but what is the Islamic equivalent to bonds? What halal instruments do Muslims have available to them to diversify and are non-correlating to shares?

Would really appreciate your thoughts.

yes he is amazing! :slightly_smiling_face: the unbiased approach to analysing and talking things at the macro-level helps to get the bigger picture.

Completely agree that it does feel that shariah-compliant products seem expensive but I guess there are additional compliance/active screening to consider and its like a niche rather than the mainstream products. I hope too that with more demand and more competitors coming to this space will help the costs going down. This probably is another good reason for all of us to invest smartly and keep our fees low (as highlighted in video 2 and 4). The more we all know the fewer charges we pay.

Walikum as salam @MAiken

The Islamic equivalent of bonds are called Sukuks. The one I am aware of is Franklin Global Sukuk Fund. I am myself looking for suggestions on this if any reader is aware of the Sukuk funds in the market?. I have seen this available on Wahed portfolios and simply ethical.

Diversification: Have a look at the IFG Halal Comparison tool but I don’t think that we have shariah-compliant full-blown multi-asset funds/instruments available. Portfolio can be as simple as one global equity and bond (Sukuk) fund or maybe cash ISA at Al Rayan if you want a relatively low-risk instrument. Wahed may be a good place to get a feel of the readymade portfolios if you are interested in the “Do it for me” approach.

Correlation depends on a lot of different factors. You may find this article interesting on the correlation matrix

All the best.

Great post @Zeeshan - thanks for sharing. Will check this guy out.

Yes unfortunately @MAiken one of the key parts of modern portfolio theories are that you should heavily invest in bonds due to their liquid nature and fixed income returns and relatively negative correlation with the stock market.

But apart from Franklin Templeton (which is exorbitantly expensive) there are no sukuk funds.

The issue fundamentally is that there aren’t that many quality sukuk issuances.

Why’s that?

Well let’s look at the bond market and why there are lots of bonds. Lots of corporates issue them and lots of governments issue them.

On the Muslim side - 25% of the world’s population as we know - sadly we don’t have many properly Islamic corporates who actually can be bothered to go sukuk over bonds, and even fewer Muslim countries who opt for sukuk issuances over bond issuances.

Its frustrating but here we are.

So what do we do?

I think there are two things:

  1. Short-term, there are solutions like Qardus (you can find out more here) where you can lend out in a halal way to SMEs. This is definitely higher risk (and higher reward) than your typical bond though.
  2. Godwin (again you can find it on the comparison) offers fixed returns based on a wakala note and is property backed. Again high risk high reward though.
  3. You can invest in property either by yourself or through Yielders (again on the Halal Investment Platform).

Overall, there are now fixed income alternatives for Muslims to consider, but these alternatives are higher risk and more illiquid (hard to exit) than a standard bond.

The second thing is:

We need to create a world where more Muslim businesses flourish and grow to sufficiently large international scale that they require sukuk issuances etc.

For that we need to back early-stage Muslim entrepreneurs creating big things. That’s why we set up ( It’s a very long-term game but if it succeeds the entire Muslim ecosystem benefits iA.

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Asalamu alaikum,

@ibrahimkhan & @Zeeshan,

Thank you for all the information. I have been searching for a while to find a medium/low risk investment (to invest about £2000) for my child’s future. All the halal ones I have found (only a few) are ones that require regular payments, example ( Red Rose - Junior Shariah ISA)

I want one that I can invest a lump sum and then decide if and when I want to pay anymore in. Can you direct me to which would be good.

I am very new to all this so, any help would be greatly appreciated.

Thank you

walikum as salam,

For a one-off basis lump sum, it’s probably best to open an account with AJ bell and invest in the HSBC Islamic fund “BC GBP” version directly as this would be cheaper - AJ bell charge 0.25% as platform fee whereas red rose charges 1.57% so it makes sense to stick with AJ bell for your scenario. (Fund is same in both cases so should have similar charges).

Also, I am not sure if red rose or others are only offering regular investment options and not one lump sum option. For a child account, they are probably highlighting the option of regular investing as that is a very good strategy over time but I doubt that any provider restricts anyone planning to just do a one-off payment. Below is the extract from the red rose website - under the main product features and to me it suggests that there is no restriction for a one-off contribution basis. The best thing is to call them and clarify if you are keen to go with the red rose.

There is no set premium – you can pay in regularly by monthly direct debit of £10 or more and/or invest lump sums at any time up to the annual Junior ISA limit

Also, If you put the child in the search bar, you can find a few threads discussing the topic. Below are the links for some posts on child investment that you may find useful.

Hope this helps


Thank you for your reply, red rose was one of the accounts I was looking at but thought I had to make regular payments not be able to put in a lump sum so thank you for clarifying. I looked at AJ Bells but was not sure if they were halal but will look at them again for the account you have mentioned and will probably go with them as they have lower fees like you mentioned.

Thank you for your help.