MNZL provides broad U.S. equity exposure that complies with Islamic finance principles, screening out companies involved in alcohol, pork, gambling, weapons, and those with excessive debt or interest income. It's essentially the S&P 500 for Muslim investors who need Sharia-compliant portfolios.
How It Works
The fund tracks a Russell index that starts with broad U.S. stocks, then applies both business activity screens (no haram industries) and financial screens (debt-to-assets under 33%, cash/interest-bearing securities under 33%). Unlike some halal funds that use subjective Sharia boards, this follows systematic, rules-based screening. The resulting portfolio typically excludes most financials and tilts toward tech companies that naturally carry less debt.
Key Features
- Zero expense ratio makes it the cheapest halal equity option available
- Broader universe than competitors — captures mid and small-caps beyond just large-caps
- Systematic screening process provides consistency without subjective interpretation
Risks
- Sector concentration risk — excluding financials and other sectors can lead to 40%+ tech weights
- New fund with no assets yet — could face liquidity issues or closure if it doesn't gather scale
- Halal screening can miss major market rallies driven by excluded sectors like banks or defense
Who Should Own This
Muslim investors seeking core U.S. equity exposure without compromising religious principles, or ESG-focused investors who appreciate the debt and interest screens. At zero fees, it's a no-brainer replacement for any existing halal equity fund charging 50+ basis points. Works as a complete U.S. allocation for Sharia-compliant portfolios or paired with sukuk for balanced exposure.