For an ETF to be classified as Shariah-compliant in Malaysia, it must pass a rigorous two-stage screening process overseen by a qualified Shariah adviser and endorsed by the Securities Commission's Shariah Advisory Council (SAC).
Stage 1: Business Activity Screening — each company in the ETF's portfolio is screened to ensure it does not derive revenue from prohibited (haram) activities. Companies are excluded if they are involved in:
Stage 2: Financial Ratio Screening — even companies in permitted industries must pass debt and interest income thresholds. The common benchmarks used by SC Malaysia are:
| ETF | Category | Annual Fee | Manager | Shariah Adviser | Live Price |
|---|---|---|---|---|---|
| 0828EA TradePlus Shariah Gold Tracker AmInvest (Am Islamic Funds) | Gold | 0.40% | AmInvest | BIMB Investment | — — |
| 0827EA EQ8 Dow Jones US Titans 50 ETF Licensed fund manager | US Equity | ~0.50% | Licensed manager | ISRA Consultancy | — — |
| 0825EA EQ8 MSCI South East Asia Islamic Dividend Licensed fund manager | SEA Equity | ~0.50% | Licensed manager | ISRA Consultancy | — — |
| 0824EA EQ8 MSCI Malaysia Islamic Dividend Licensed fund manager | Malaysia | ~0.50% | Licensed manager | ISRA Consultancy | — — |
| 0821EA EQ8 Dow Jones Malaysia Titans 25 ETF Licensed fund manager | Malaysia | ~0.50% | Licensed manager | ISRA Consultancy | — — |
Prices fetched live from Yahoo Finance · Refresh every 60 seconds · Verify at Bursa Malaysia before trading · Shariah status subject to annual re-screening by respective Shariah advisers
A common concern among Muslim investors is whether choosing a Shariah ETF means sacrificing returns. The evidence suggests the gap is smaller than many expect — and on some metrics Shariah portfolios have outperformed.
Many Malaysians search for HLAL ETF (Wahed FTSE USA Shariah ETF, ticker: HLAL on NYSE Arca) after seeing it discussed in personal finance communities. HLAL is a US-listed Shariah-compliant ETF tracking the FTSE USA Shariah Index — it is real, regulated, and genuinely halal-certified.
However, to buy HLAL you need a broker with US market access (moomoo, Tiger Brokers, or Interactive Brokers). You cannot buy HLAL through Rakuten Trade or most Malaysian bank brokers. Key considerations:
Malaysian investors holding US-listed ETFs (including HLAL) are subject to US estate tax of up to 40% on holdings exceeding USD 60,000 at death. This is a real and often-overlooked risk. Bursa-listed ETFs like 0827EA are not subject to US estate tax. For portfolios above ~RM 280,000 in US ETFs, this risk deserves serious consideration. Consult a licensed financial planner who understands cross-border estate issues.
Wahed Invest Malaysia is a separate product — a robo-adviser platform offering Shariah-compliant portfolios. It is not an ETF itself but invests in a mix of halal ETFs and sukuk. It is a valid option for investors who want a managed Shariah portfolio without choosing individual ETFs. Lower minimum investment (from RM 100) and simpler onboarding compared to a broker account.