DUBAI 29 October 2019: Dubai Financial Market (DFM) yesterday launched the Dubai Financial Market Sharia Index (DFMSI).
According to a DFM statement, the index is the first index of its kind in the UAE. It highlights the DFM’s efforts to attract more Islamic investments, and is seen as a step forward by providing market participants with a benchmark to measure the performance of Sharia-compliant listed securities and to take their investment decisions accordingly.
It is accessible through DFM’s website, mobile phone applications as well as any other data dissemination platforms run by the DFM or by licensed market data providers. The initial market capitalisation of the Sharia Index has been set as per stock prices on 31st December 2009 with 1,000 points as the base point of the Index.
Essa Kazim, Chairman of DFM said, “The Index enables Sharia-complaint investors and international institutions a trajectory of the historical and current performance of DFM’s Sharia-complaint shares compared to other Islamic or conventional indices at the local, regional and international levels.”
“We believe that the DFM Sharia Index is a strong push to our efforts to further attract Islamic investments, considering the growing demand from investors across the world for ethical investments that focus on companies adhering to the Islamic Sharia or to any other general values related to sustainability and environment protection,” he added.
DFM Fatwa and Sharia Supervisory Board
Shares included in the DFM Sharia Index are designated in line with the quarterly updated list of Sharia-compliant companies prepared by the DFM Fatwa and Sharia Supervisory Board, which revises the list based on the quarterly financial results of listed companies.
The Fatwa and Sharia Supervisory Board implements the revision in line with DFM’s standard for issuing, acquiring and trading of shares issued in 2008 and its amendments issued in 2018.
Currently, the DFM Sharia Index consists of 40 listed companies including 30 UAE companies and ten dually-listed companies and the weightage of any company is capped at ten percent.
According to the State of the Global Islamic Economy Report 2018/2019, the Islamic Economy is poised to significantly grow during the coming years. The report estimates that global Muslim spending reached US$2.1 trillion in 2017, while total assets of the Islamic finance sector reached US$2.4 trillion.