Why this list exists
A real question from the SimplyFI UAE Bogleheads group: "How do you check if a stock or ETF is halal? I'm using ISDW because it's AAOIFI-compliant." It pulled 20 comments. Most of the replies described the same shape of portfolio: a Sarwa Halal sleeve, a Wahed account, a stash of physical gold, and one or two home-country properties — four products that feel diversified on the dashboard but aren't.
A single AAOIFI-screened Irish-domiciled equity ETF holds 200 to 3,000 underlying companies across 20-plus countries. That is, by any reasonable definition, more diversified than four UAE-accessible Halal products combined. It is also cheaper to hold, easier to rebalance, and portable across borders.
This page is a reference list, not a product pitch. Nothing on it is a recommendation. The funds shown are the AAOIFI-screened options whose issuer documentation is in the public domain and whose ISINs we can verify against the OpenFIGI registry at build time.
What "Shariah-screened" actually means
AAOIFI — the Accounting and Auditing Organization for Islamic Financial Institutions — publishes the Shari’ah Standards that most global Islamic funds reference. Two are load-bearing for ETFs:
- Standard No. 21 (Financial Papers) sets the rules for permissible equity investments: exclude alcohol, gambling, conventional banking and insurance, pork and non-Halal food, adult entertainment, weapons, and tobacco.
- Standard No. 35 (Zakah) sets the rules for the annual zakat owed on investment holdings.
On top of the industry exclusions, every AAOIFI-aligned index applies financial-ratio screens. The typical thresholds: total interest-bearing debt below 33% of market cap, interest-bearing investments below 33%, and impermissible-source revenue below 5%. A third-party Shariah board reviews the index each quarter and re-balances or removes companies that breach the thresholds. The fund issuer publishes a purification ratio so holders can donate the impermissible fraction of dividend income to charity.
The shorter version: a fund is "Shariah-screened" because a named Shariah board says so and because the issuer commits to maintain the screen in the prospectus. The label is not self-asserted.
Irish-domiciled — why it matters
Two funds can hold the same companies under the same Shariah screen and still leave a UAE-resident holder with materially different after-tax outcomes. The reason is domicile.
A US-domiciled fund (HLAL, SPUS, UMMA) pays a 30% US withholding tax on its dividend distributions to a UAE resident, because the UAE has no tax treaty with the US that reduces the rate. The same holder is also exposed to US estate tax above $60,000 on death, under IRC §2104, with no treaty relief.
An Irish-domiciled UCITS (ISDW, ISDU, IGDA) pays roughly 15% withholding at the fund level via the Ireland-US treaty, and carries no US estate-tax exposure because the holder owns shares of an Irish company, not US assets. For long-horizon Halal investors, the after-tax difference compounds materially.