Dow Jones Indexes licenses the family of DJIM indexes as the basis for Shari'ah-compliant investment products. Since these indexes are constructed using Islamic screens and filters, DJIM indexes facilitate the launch of Islamic mutual funds and ETFs by limiting the research and management costs involved in maintaining a product's Shari'ah compliance. However, even a product that tracks a DJIM index requires some supervision by a Shari'ah Board to ensure that it stays Halal.
A company creating an index-tracking product typically begins by acquiring a portfolio that matches the composition of the index. This means purchasing all the securities listed on the index in proportions that reflect the index weighting. Companies may also purchase a representative sample of the index components, provided the portfolio accurately replicates the index's performance.
To facilitate the creation of index-tracking products, DJIM indexes are designed to be entirely investable, with constituents that are all readily available and highly liquid. The subindexes of the DJIM World Index are available for licensing to develop Shari'ah-compliant funds that concentrate on narrow market segments, such as a particular industry, country, or market capitalization range.
To discuss licensing possibilities, please contact Dow Jones Indexes at:
Tel: +1.609.520.7249 / +86.10.8400.7774 / +49.69.29.725.180
Email: djindexsupport@dowjones.com