Shariah-compliant market tests perceptions
Opinions are divided on quantifying the vastly important market for Shariah-compliant investment products, leaving institutions about how what resources to devote to them.
Some remarkable numbers are thrown around about the global Islamic finance industry, though debate rages as to how reliable they are; commonly cited figures are $500 billion in managed assets, and a growth rate of 15–20%, underpinned by almost 300 institutions.
So if that’s the case, why isn’t every international fund manager trying to sell Shariah-compliant versions of their global equity products to high-net-worth people in the Gulf?
It’s one of the complications of this fascinating area. Shariah-compliant investment is clearly of immense importance, but opinion is enormously divided on how to quantify it. At a regional level, it is clearly well entrenched; in Saudi Arabia, 53% of funds, and 72% per cent of assets, are Shariah-compliant.