Grow your Investment Portfolio with our Sharia Compliant Supermarket on Thndr! 

Whether you’re looking for a new sharia compliant investment or even wonder what Sharia compliant even means, this article is for you! 

We’ve got a range of  investment options lined up for you to explore, no matter what you investment style is or your risk appetite we have just the thing for you!

First off let’s understand what is Sharia-Compliant Investing?

So, if a company is deemed as Sharia compliant that means that it adheres to all the rules designated by the EGX to classify it as one. These rules are: 

Prohibition  from investing in the following activities:

• Alcohol-related businesses
• Pork or pig products
• Conventional commercial banks
• Conventional Insurance companies
• Speculative currency trading
• Gambling enterprises
• Inappropriate advertising or promotion
• Material related to pornography
• Non-Sharia-compliant meat processing methods

If they tick all of these boxes, then they pass the test as Sharia compliant. So if that’s the kind of investment you’re looking for, well you’re in luck because there’s a brand new index that is just for you, the EGX33.

What is the EGX33?

The EGX33 is a unique index that tracks the most liquid 33 Sharia-compliant companies listed on the Egyptian Exchange (EGX). Those 33 companies are picked from the EGX100 index, and are reviewed semi-annually by the board of the index. 

Who is the Sharia board composed of?

Compromised of a group of notable figures, the board includes the following:

• Chairman of the Board, Dr. Amr El-Wardani – Secretary of Fatwa at the Egyptian Fatwa House
• Vice Chairman of the Board, Dr. Ezz El-Din Tohamy – Emeritus Professor of Accounting at Faculty of Commerce at Al-Azhar University
• Dr. Hassanein Abdel Moneim, member of Sharia supervisory boards of several financial institutions.

So, what are the 33 companies that the index invests in?

The companies within the EGX33 include a broad range of 15 sectors, offering a well-rounded investment portfolio. 

From technology and telecommunications to healthcare and consumer goods, the index features companies that comply with specific Sharia and index criteria.

Note that these companies change every 6 months (at the end of January and July of every year) based on the Sharia board’s semi-annual review and their weights within the index also change daily.

 Investment Criteria for EGX33

To be included in the EGX33 index, companies must meet stringent criteria based on both Sharia law and index-specific guidelines. 

These are the Sharia criteria 

• No more than 5% of a company’s revenues derive from non-Sharia compliant activities such as the sale of alcohol.
• If a company’s interest-earnings investments (such as long- and short-term Treasuries) do not exceed  33% of its assets or of its average market cap, whichever is higher.

And these are the index criteria

• The ratio of a company’s liquid assets should not exceed 70% of its total assets.
• Companies not included in the EGX100 but having a Sharia supervisory board can be added to the index if they meet the liquidity criteria.
• The relative weight of any company cannot exceed 15% of the index when partially reviewed every three months (February, May, August, and November).

Want to know more details about the index, read the prospectus liked here.

How Can I Invest in the EGX33 index?

You can tap into the EGX33 index through two main fund options: CMS and ASO. Each offers a different investment style, catering to various risk appetites and investment strategies.

CMS & BWA : The Passive Route

If you prefer a hands-off approach, CMS and BWA is your go-to. These passively managed equity fund mirrors the EGX33 Sharia index, offering a low-cost, straightforward way to invest in a diversified portfolio.

ASO: The Active Approach

For those who like a more dynamic investment strategy, ASO actively manages its portfolio to outperform the index. Fund managers make strategic decisions based on market conditions, offering a chance to maximize returns.

Interested in more Sharia-Compliant Products? Thndr’s got you covered!

We have a whole Sharia-compliant supermarket right at your fingertips.

NM Sharia Equity Fund (NMF or Naeem Misr Fund) was the best-performing Islamic equity fund in 2023. It is an equity fund that aims to provide returns through investing in Sharia-compliant stocks listed and traded on the EGX.  It’s categorized as a high-risk, high-return investment opportunity. The fund is managed by NAEEM Financial Investment (NFI) and has been dubbed Sharia-compliant by an internal committee led by Dr. Ali Gomaa, the former Grand Mufti of Egypt.

MTF is more than just a savings fund – the low-risk and highly liquid investment opportunity has been dubbed Sharia-compliant by an internal committee led by Dr. Ali Gomaa, the former Grand Mufti of Egypt.

AZG: Gold is an investment favorite as old as time and has historically been a great hedge against inflation. You can invest in gold through the AZG (Azimut Gold) fund on Thndr. When you buy certificates of AZG, 100% of your money is invested in physical 24k gold that is stored in CBE-licensed vaults.

Sharia Theme: This is a curated list presented to you by Thndr with all the Sharia compliant companies within the EGX, so you can pick and choose at your convenience