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Halal investing encourages a disciplined investment process that promotes in-depth security research and monitoring.
ALPHA HALAL FUND (hereinafter The Fund) is an open ended collective investment scheme that focuses investments only into ethical and Shar’iah Compliant financial products, within the SADC and EAC regions (hereinafter The Prescribed Territory). The Fund shall accept funds without the limitation of borders, but only invest in ethical financial securities, specifically equities, sukuk bonds and ETFs, that adhere to Shar’iah principles outlined in this offer document.
Returns of the scheme shall be based on the Net Asset Value (NAV) and shall be recalculated on a daily basis. Investment income from permissible financial products shall be reinvested by the Manager to grow the value of the scheme.
The Fund is a perpetual open-ended Collective Investment Scheme under the Capital Markets and Securities Act 1994, and the provisions of the Capital Markets and Securities (Collective Investment Schemes) Regulations, 1997 as amended.
The Sponsor, Investment Advisor and Fund Manager, Global Alpha Capital Limited (“Alpha Capital”) and the Trustee / Custodian, CRDB Bank Limited (“CRDB”) are both limited liability companies incorporated in Tanzania. Alpha Capital is licensed as a Fund Manager by the Capital Markets and Securities Authority (CMSA).
Alpha Capital is also a licensed Broker/Dealer in financial securities, Investment Advisor, a Licensed Dealing Member (LDM) of the Dar es Salaam Stock Exchange (DSE) and a Central Depository Participant (CDP) of the Bank of Tanzania. The Custodian, CRDB Bank Plc, is licensed by the Bank of Tanzania as a commercial bank under the Banking and Financial Institutions Act, 1991 and by CMSA as a Securities Custodian.
The Shariah compliance governance framework includes a Shari’ah Advisory Board (SAB), an in-house Chief Shari’ah Compliance Officer, an external Shari’ah Advisor and an independent international securities screening agency
The Manager’s entire staff underwent special training on Islamic Finance Principles, including the guidelines applicable to institutions providing Islamic financial services
Our Shari’ah Advisory Board (SAB) comprises of seasoned Islamic scholars, all of whom meet the basic qualifications set in the Board’s Charter. A Shariah Advisory Board member is an independent natural person specializing in Fiq-h al-Mua’malaat (Islamic Business Law). Thus, Alpha Capital ensures that every member of the Shari’ah Board fulfils the following criteria:
(i)To be Fit and Proper;
(ii)Shall be a Muslim, enjoying the legal capacity; and
(iii)Must be at least a Degree holder of Shari’ah or Islamic Finance, including Islamic Business law from a registered institution.
Prof Khalfan holds a PhD in International Economics from the Putra University in Malaysia, in addition to qualifications in Islamic Finance and Capital Markets. He is vastly knowledgeable and experienced in Islamic Economics and Finance matters, having served as a Principal Economist with the Bank of Tanzania, the Zanzibar Investment Promotion Authority (ZIPA), and as UNIDO Country Delegate in the Gulf States. Prof. Hafidh is an Associate Professor, a Senior Research Fellow at the Dar es Salaam based Economic and Social Research Foundation (ESRF) and he lectures to Executive Programs in Economics (Economic Management and Economic Policy Analysis) at Zanzibar University as well as at the Sumait University in Islamic Finance and Administration. currently working as a freelance in academics, consultancy and research on top of his position as Chief Executive of the Presidential Delivery Bureau (PDB) in the Office of the President of Zanzibar and Chairman of the Revolutionary Council. He has supervised several projects, thesis and dissertations in Business Management, Economics, Entrepreneurship and Islamic Finance.
Dr Tego is an Islamic Finance Scholar, holding a PhD in Economics (Islamic Finance) from the Omdurman Islamic University of Khartoum (Sudan), and an MA in Islamic Studies (Islamic Banking and Finance) from the Muslim College of London (UK).
Dr Tego has served as a Deputy Vice Chancellor and Acting Vice Chancellor of the Morogoro Muslim University in Tanzania. His contributions to Islamic Finance education in Tanzania include development of Shari’ah related materials for the Faculty of Law, and Faculty of Business Studies for the Morogoro Muslim University, preparation of teaching materials, facilitate teaching and assessment of the Islamic banking and finance causes offered by the Tanzania Institute of Bankers (TIB) and by the Center for Islamic Finance Compliance and Advice (CIFCA).
Mr SINAN holds an MA in Shar’iah from the Sumait University in Zanzibar, a B.A in Islamic Studies from the Medina University of Saudi Arabia and a Diploma in International Relations and Diplomacy from the Centre for International Relations, Dar es Salaam, all received after studies at the Abubakar University of Karachi, Pakistan. He also holds a Certificate in Shar’iah Banking and Governance received following training by the Tadoman Islamic Bank of Sudan.
Mr Sinan’s career include service as the Secretary of Africa Muslims Agency - Tanzania Office; teaching of Arabic and Islamic Knowledge at Al - farouq Islamic Seminary and Al- haramain Islamic Seminary and as Assistant Secretary of Haytul Ulamaa fy Tanzania, an organization whose Mission is to be a think tank and a beating heart for Muslims in the areas of Islamic intellectual sphere and knowledge.
The core principles of Fund are:-
Interest generally refers to the doubling of money or commodities. Called “riba” in Arabic, it means increase and excess.
Islam Finance prohibits this exploitative practice in every capacity. There are two major types of Riba: Riba-anNasiyah is the increase of loan or money (i.e. borrowing $100 but owing $120), and Riba-al-Fadl which is the simultaneous exchange of unequal qualities or quantities of a given commodity.
Alpha Halal Fund shall not engage in any form of Riba.
This principle is simple, all Unitholders will enjoy the equal benefit, and in case of loss, everyone will suffer equally.
In Islamic finance, partners that enter into arrangements share the item's profit or loss and risks. Nobody can gain more from the exchange than the other side.
The three main products offered by the current Islamic Financial System are:
1. profit-and-loss sharing partnership (mudarabah)
2. profit-and-loss sharing joint venture (musharakah)
3. where a representative is appointed to undertake transactions on another person’s behalf for a fee (wakala).
Alpha Halal Fund shall operate exclusively on the basis of a wakala arrangement i.e. service providers, including the Fund Manager, Trustee/Custodian, Shari’ah Advisor and Auditor shall be remunerated on basis of pre-agreed rates.
Islamic finance prohibits the financing of, or a business engaged in, something that is haram. Generally, the following should be avoided:
• production or Selling alcohol;
• A business practice that involves the exchange of interest;
• Industries manufacturing unhealthy drugs;
• Banking products that include Riba;
• Industries related to prostitution or pornography;
• Industries related to Pork
Alpha Halal Fund shall avoid dealing in any securities associated with the above.
Maisir means speculation.
It is prohibited in Islamic finance because it creates wealth from chance instead of any sort of productive activity. Shari’ah, however, does not forbid regular commercial speculating in business since commercial risk-taking is an inherent component of Islamic financial transactions.
Conventional insurance is the most common type of Maisir.
Gharar stands for uncertainty, hazard, chance, or risk. In simple words, it is prohibited to get involved in activities where the results are uncertain or consequences are undetermined.
Short-selling is a common example.
There are three types of Gharar:
1. Major Gharar (Gharar-Fahish)
2. Gharar Minor (Gharar-Yaseer)
3. Moderat Gharar (Mutawassit)
These are the principles that inform our Code of Conduct that will assist us in achieving the financial, ethical, and social goals of the Fund and its Unitholders.
Refinitiv, the Fund’s screening agent, follows a coherent Shari’ah screening methodology based on total assets as a divisor (denominator), representing the true unbiased value of a potential investee company.
Refinitiv Shari’ah complaint screening methodology assess if any of the following industries are less than 5% of the total revenues and interest income
• Adult Entertainment
• Adult Entertainment
• Alcohol
• Cinema/ Broadcasting
• Insurance companies
• Tobacco
• Music
• Financial Services
• Investment Services
• Mortgage & Lease
• Gambling
• Interest Income
• Hotels
• Pork
• Defence
• Interest-bearing Debt / Total Assets less than 33%
• Cash, Cash Equivalents, Short Term Invest. / Total Assets less than 33%
• Cash, Cash Equivalents, Receivables / Total Assets less than 50%
As a full-service Broker and Investment Advisor licensed by the CMSA, we provide our clients with a wide range of services from the traditional broker-dealer services. Our goal is to deepen capital markets for the benefit of the Tanzanian Economy by forming meaningful and ethical partnerships.
Shariah compliant mutual funds follow Islamic finance principles, which prohibit investments in certain industries, such as alcohol and gambling. Conventional mutual funds do not follow these principles.
You can look for a certification from a reputable Shariah supervisory board or consult with a financial advisor who specializes in Shariah compliant investments.
Returns are generated through the appreciation of the fund’s investments and income from dividends, rental income, and other sources.
Shariah supervisory boards oversee the funds’ operations and ensure that investments comply with Islamic finance principles. They use screening criteria to determine if a company is Shariah compliant or not.
No, anyone can invest in Shariah compliant mutual funds. These funds may appeal to investors who want to align their investments with their values and beliefs.
Like all mutual funds, there are risks associated with investing in Shariah compliant mutual funds, including market risk, liquidity risk, and currency risk.
Yes, investors can diversify their investments by investing in both conventional and Shariah compliant mutual funds.
Investors should consult with a tax advisor to understand any potential tax implications of investing in mutual funds.
Investors can compare the performance of Shariah compliant mutual funds to conventional mutual funds using metrics such as returns, volatility, and expense
Shariah compliant mutual funds avoid investing in industries such as alcohol, gambling, pornography, and conventional finance.
The primary objective of The Fund is to basket ethical financial products within the prescribed territory (EAC and SADC), that adhere to Shar’iah principles, so as to accommodate ethical and Islamic investors whose individual investment options in conventional markets are limited. The Fund is also a diversification tool for investors. Historically, Shari’ah compliant public companies are known to weather market cycles better, a case in point is the 2008 financial crisis.
The Fund’s Investment Policy provides for diversification of the investment portfolio. By spreading our investments across different asset classes, sectors, and geographic regions, the Fund can reduce the impact of a single underperforming investment on the overall portfolio.
The Fund shall invest in listed Halal stocks, sukuks and ETFs.
Notwithstanding the benchmark index and tracker, The Fund reserves the right to actively manage its portfolio, in consultation with The Advisor and the SAB, in the best interest of the Unitholders as ultimate beneficiaries.
No: | Asset Class | Limit |
---|---|---|
1 | Listed Hala Equities | Up to 70% |
2 | Sukuk | Up to 60% |
3 | Halal ETFs | Up to 30% |
4 | Shari’ah Compliant Deposits | Up to 10% |