Hey Jeremy,
Earnings from Interest is not allowed in my religion of (Islam). If I invest in Roth IRA or S&P 500, as it grows over the years towards million dollars; is that growth from compound interest or profit/loss?
I have saved little over 20k and would love to invest it but I would like to stay away from any investment that is associated with interest growth.
Hey Ismael!
So I’ll start by saying to fully and thoughtfully answer this question, someone would need an expertise of publicly traded accounting and Islamic law that’s beyond my reach, so take my thoughts with a grain of salt.
THAT SAID, I HIGHLY DOUBT an S&P 500 index fund would qualify under your religion as “interest free growth”. For example, Bank of America is a company in the S&P 500. Owning an S&P 500 index fund means owning Bank of America stock. Bank of America has several lines of revenue. Many of which include collecting interest. For example, they loan money out for a mortgage, then the borrower pays it back with interest. That interest goes to Bank of America’s profit, which is translated to growth and dividends of their stock, and thus growth and dividends of the S&P 500. Again, not a religious scholar, but I think general logic and integrity would dictate, no amount of clever accounting really would get around the spirit of the rule.
BUT, I have some good news for you. My understanding is that there are some companies and investments that specialize in mutual funds and ETFs that are Sharia-Compliant! I don’t have specific experience with them, so I hesitate to recommend a specific one, but here are some options:
You should be able to buy those ETFs at any brokerage. Like I said, not my specific area of expertise, but if I had your requirements, I’d probably dump all my investments into one or two of these ETFs 
You daaaa mannnn!!!
Thank you so much for your time. Your answer is spot on!
Hey Jeremy. Thanks for letting me know about the page.
So similar situation where there are certain principles when it comes to investing that are sharia compliant (no interest companies like banks and other areas as well).
So I’m based in the UK and have access through a brokerage for the ISWD and ISUS that you mentioned.
There is another fund I’m investing in (available in the UK) which is:
HSBC Islamic funds: global shariah index fund (variety of classes but I may move to the AC class). Now this fund tracks the Dow Jones Islamic Titans Index and has around 100 odd stocks in there. It’s a bit heavy on tech (Microsoft, Google etc), but over the last 10 or so years as done really well.
My question is - I want to follow some of the tips you give on DCA into the funds. So thinking around ÂŁ100-ÂŁ500 per month (if I can) over minimum 15 years.
Do you think the HSBC one would be a good index fund to put it into? (Considering principles) as it has 100 odd large caps in there as I was thinking along this type of allocation:
HSBC Islamic index fund: 50%
ISWD: 20%
ISUS: 20%
ISDE (Ishares emerging market Islamic etf): 10%.
Thinking of DCA with the above with the aim to get 10% annualised over 20 odd years.
Let me know what you think brother as be good to get your advice so I can dca and not tinker too much. Thank you for reading :).
Peace be with you.