Sukuk — Islamic Bonds
Sukuk are Islamic investment certificates often described as the Sharia-compliant alternative to conventional bonds. Rather than representing a loan that pays interest, a Sukuk certificate typically represents an ownership interest in a tangible asset, a project, or a defined business activity, with returns generated from the performance or lease income of that underlying asset.
Fair Meridian's Sukuk resources explain how these instruments differ structurally from conventional bonds, including the role of asset-backing, the most common Sukuk structures (such as those based on Ijara or Murabaha), and how Sukuk fit into a diversified halal investment portfolio as a fixed-income alternative.
For US investors, access to Sukuk has historically been more limited than access to conventional bonds, though this has been changing as Sharia-compliant fixed-income funds and ETFs have started to include Sukuk allocations. Understanding how a fund gains Sukuk exposure — direct holdings versus indirect exposure through other instruments — is an important part of evaluating a halal fixed-income product.
These guides are educational resources designed to help readers understand Sukuk as an asset class. Investors should review a specific Sukuk offering's structure, underlying assets, and risk disclosures, or consult a qualified financial adviser, before investing.