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In the Name of God بسم الله
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Dragon123

Halal Investment in mutual bonds

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I am currently investing money in a retirement plan (Roth and 403b) and investing through Fidelity and TIAA-Cref. There are a lot of different mutual fund options where groups will invest money for you. It came to my attention that many of these are potentially haram because they may invest in businesses that are involved in haram. It is hard to know which companies are so certain mutual funds create filter based on principles to avoid this issue (social responsible investing or SRI). This issue was addressed and confirmed by marjas, such as Sistani:

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In light of what we have said, investing in mutual funds and the stock market in which the returns are not guaranteed would be permissible.
Such investments, however, could become haram because of secondary reasons: like If one invests in a company that deals in a haram commodity, such as a brewery or casino. The best option for a Muslim investing in mutual funds would be the “ethical funds'” since such funds do not deal in alcohol, tobacco, gambling or environmentally harmful products.

However, there are a few companies such as AMANA which also involves riba:

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The Growth Fund does not make any investments that pay interest. In accordance with Islamic principles, the Fund shall not purchase conventional bonds, debentures, or other interest-paying obligations of indebtedness. Islamic principles discourage speculation, and the Fund tends to hold investments for several years.


However, if you review other rulings from Sistani, he allows investment into interest bearing bonds and acquiring interest from non-Muslim banks. Do we need to concern ourselves with this added emphasis on interest and, if so, to what extent?

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