1. mutual funds in Islamic banking
special topics of finance project
name: Fawzeyyah AlHajiri

2. : Introduction
Muslims represent around one-fifth of the world population with more than $800
Billion to invest. This amount is growing by 15 per cent annually. Only a small portion
Of the available funds are invested in Islamic products
The Islamic mutual funds market is one of the fastest rising segments within the Islamic financial system

3. muslims can invest their funds in such businesses that meet some specific conditions, as
: follows
The investment has to be made in businesses that do not violate shari’a
2. In the case where the main line of business is lawful but the company is involved in
interest-related activities, shareholders have to express their disapproval for such dealings wherever possible
3. The income generated from dividends has consequently to be purified from such
activities by allocating a percentage of that dividend to designated charities in proportion
to the income generated from interest-related activities.
4. The shares of the company can only be negotiable if the business owns some illiquid
assets

4. Marketing and distribution of Islamic mutual funds
Islamic-based mutual funds offer Muslim investors the double advantage of mutual fund
investment and compliance with Islamic guidelines. The tolerability of common stock
screening guidelines by an overwhelming majority of shari’a scholars has not been deciphered
into more demand for such investing mechanisms.
Sharpe measure showed that the performance of the Islamic mutual funds compared to
both benchmarks during the second period dominated by recession is better than that
during the first sub-period. This might imply that the performance of these
funds is improving with time, Another implication from this result is that Islamic mutual funds
Might be a good hedging investment for any equity investor, if used to hedge against market downturns and recessions.

5. Conclusion :
This study has examined Islamic mutual funds and the fundamentals of investing in
such venues. In doing so, it has explored the dynamics of Islamic mutual funds, their governance and control .