A complete newbie to the market !

[outlawstate]

Salam alaikom all,

M 31 years old living in France (to give a bit of Context).

I was recently introduced to the idea of financial independence and I am mesmerized by it. I have zero experience in the stock and investing market. Never thought that it has some halal parts in it. Untill thanks to you and some other posts.

Now to begin. What is the best path you recommend me to begin with. Start with some index fund Sharia compliant like s&p and hlal.

• Hire a financial entity to consult with at least for the first year to get the hang of it.
• Go big and invest in some companies from the get-go.

Now to the technical side. What site/app I use for my market portfolio.

I have read vanguard is a good one.

I am planning on investing at least 750 euros per month. And planning on gaining financial independence by 45 years. Do you think it's attainable ?

If you have books, videos, blog posts to enhance my financial knowledge throw them my way please (preferably Islamic halal recommendations).

جازاكم الله خيرا

 

[resjudicata]

@outlawstate W'Salaam! Absolutely - I'm not endorsing anyone, but check Wahed Invest. Their fees are high, you could probably manage your own portfolio but there's a great calculator on their website for you to model potential returns over a 30 year period. Also, check this link to a FIRE calculator. You can customize whatever data inputs to model out a FIRE lifestyle.

https://wahedinvest.com/

https://engaging-data.com/fire-calculator/

 

[jaggerwayne]

@outlawstate You can search for shariah compliant stocks in Zoya or Islamicly app. There are also some shariah compliant ETFs like SPUS, ISDW, ISDE or ISDU. You can only put a very small part of your investments in an commodities ETF, for ex. Gold, to protect your portfolio during downturns.

You can search for shariah-compliant stocks in Zoya or Islamicly app. There are also some shariah-compliant ETFs like SPUS, ISDW, ISDE, or ISDU. You can only put a very small part of your investments in a commodities ETF, for ex. Gold, to protect your portfolio during downturns.

 

[d1975mon]

@outlawstate Regarding investing in the market, a lot of very known scholars like ibn baz and ibn athmeiin say that it’s only permissible to invest in companies that do not have any involvement in non permissible activities, no riba (debt with interest or any fixed income products) and nothing non ethical like exploitation of cheap labor etc

The same goes for index funds which are a portfolio of stocks of certain companies, which means every single stock in the fund should pass the tests.

There is an extensive study in Arabic that goes over this and shows where the arguments of the people who are advocating for these product are either using specific rules in the wrong context, etc

Summary of the different views: https://forum.islamicfinanceguru.co...g-halal-can-you-invest-in-the-stock-market/16 Edit: added a link on summarizing the different views

The extensive study (in Arabic) couldn’t find a translation: http://www.riyadhalelm.com/book/32/143_ashom_sndat.pdf

Regarding, can you reach your goal? That depends:
- what’s the target amount of money
- what kind of lifestyle do you want to have: travel, kids, cost of living etc
- your best shot is planning now and acting on your plan of course
- then how to invest and on what that’s up to you. Personally stocks are a grey area I want to avoid even with the criteria they use to define shariah compliant stocks (which personally don’t make sense). Real estate, other alternatives etc

Good luck and may Allah guide to what is best

 

[josephcamline]

@d1975mon Sorry for not understanding, do you prefer real estate and other alternatives over stocks?

 

[d1975mon]

@josephcamline Yes, as stocks are not shariah compliant (as all listed companies have interest bearing debts either way)

 

[17warner]

@d1975mon Salam brother, my mufti is of the same opinion as you and I have avoided all stocks.

Is there a company or anything you use for your real estate investments? I was recommended yielders which is a no debt based real estate crowdfunding sort of program. Are you involved in that? I am based in the US and investing in UK real estate just seems complicated as I have no idea about the market and because of the probably heavy tax burden.

 

[d1975mon]

@17warner W alaykom al salam,
I am still doing my research and not involved with any company yet. There is the tax aspect to factor in and I like to have a good understanding of their offering/market etc.
That being said, I came across yielders which I found expensive in term of management fees and the return they show are not net (correct me if I am wrong). I came across a French company as well but can’t remember the name it’s quite small and new and here as well it wasn’t clear.

 

[17warner]

@d1975mon I believe the returns yielders show are actually the net returns. It’s not expressly clear on their website but one of their partners interview with Islamic finanace guru on YouTube he said this. He also said that they usually beat their expected net.