Equity markets & shariah screening

What is the equity market?

• A. A platform for trading ownership shares in listed companies

• B. A place for depositing savings

• C. A system for trading government bonds only

Which of the following belongs to the secondary market

• A. IPO (Initial Public Offering)

• B. Private placement

• C. Buying and selling of existing shares among investors

Which is a key difference between Islamic and conventional equity markets?

• A. Islamic market prohibits activities involving riba (interest)

• B. Conventional market avoids all non-halal businesses

• C. Islamic market does not allow stock ownership at all

Which of the following activities would make a stock non-compliant in Islamic equity markets?

• A. Business related to gambling

• C. Business related to halal food

• B. Business related to alcohol

Which of the following is a characteristic of Islamic ETFs?

• A. Based on Shariah-compliant screening

• B. Includes prohibited sectors like gambling and alcohol

• C. Tracks an index made of Shariah-approved companies

Which of the following is a challenge in Shariah screening mentioned in the slide?

• Lack of adaptation to new business models

• Companies always remain compliant

• Continuous monitoring of company activities

Why is Shariah screening important?

• B. Guarantees that all companies make profit

• A. Ensures investments are free from haram activities

• C. Protects Muslim investors from unethical sectors

Which criteria are included in Shariah screening?

• C. Stock price movement

• A. Sector screening

• D. Liquidity of shares

• B. Financial ratio screening

Islamic ETFs are designed to:

• A. Provide halal investment opportunities

• B. Track the performance of Shariah-compliant stocks

• C. Maximize profit without considering ethical rules