Salaam,
What is the ruling on Investment Trusts? I understood that it’s not permissible as usually this involves a Manager/Representative to invest on your behalf. However, this can involve companies that may be Sharia compliant and companies that are not Sharia compliant.
As investors, we simply wouldn’t know.
Please can you share your thoughts.
Jzk.
Wa alaykum salaam,
An investment trust is a type of legal structure with particular features making it different to unit trusts and funds. It has the potential to be Shariah compliant, the structure alone will not render the investment as not compliant. The underlying assets will have to be screened for Shariah compliance.
Allah knows best
Jzk for the reply Mufti.
The point about investors not knowing is, usually there is no option to screen for investors as the fund Managers will simply invest on their behalf (who are non-Muslims and thus Shariah compliance will not be an issue for them.
The investor e.g. myself cannot usually choose the company to invest in and will simply hand over the money to the Manager who will invest on my behalf.
Thus, what should one do in this situation?
Thanks.