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Bombay Stock Exchange Ltd. (BSE) and Taqwaa Advisory and Shariah Investment Solutions (TASIS) launched the BSE TASIS SHARIAH 50 Index on Monday, Dec 27, 2010. The Index is the first Shariah Index created in India utilizing the strict guidelines and local expertise of a domestic, India-based Shariah advisory board. The BSE TASIS Shariah 50 index consists of the 50 largest and most liquid Shariah compliant stocks within the BSE 500.
TASIS employs a strict, proprietary screening process utilizing their knowledge of and local access to listed Indian companies to ensure that all stocks included within the BSE TASIS Shariah 50 are strictly compliant with Islamic Shariah law. TASIS has adopted financial screening norms that are more conservative than its peers, making the product ideal for Islamic investors seeking investments that adhere to the strict, conservative Shariah compliance norms.
Madhu Kannan, MD & CEO, BSE, said, ”The introduction of the BSE TASIS SHARIAH 50 Index will give Islamic and other socially responsible investors another means to access the Indian market and will help attract pools of capital to India from the Gulf, Europe, and Southeast Asia. This index will create increased awareness on financial investments amongst the masses and help enhance financial inclusion. The index will also build a base for licensing for the construction of Shariah compliant financial products including mutual funds, ETFs, and structured products.”
M.H. Khatkhatay a senior member of TASIS team said, “Shariah Index will unlock the potential for Shariah investments in India”. He further added “this is the first time a serious and concerted effort has been made to track Shariah compliant stocks in India objectively.”
According to Dr. Shariq Nisar Director, Research & Operations, TASIS, “Bombay Stock Exchange has the largest number of listed shariah compliant stocks in the world. All Muslim countries of the Middle East and Pakistan put together do not have as many listed Shariah compliant stocks as are available on BSE.”
The BSE TASIS Shariah 50 employs index constituent weight capping. Index constituent weights are capped at 8% at rebalancing, in an effort to increase the diversification within the index and ensure greater compliance with international regulatory and statutory investment guidelines.
