Purpose There are a number of differences in the current Sharīʿah screening guidelines formulated by Sharīʿah scholars associated with world-renowned index providers and financial institutions. The purpose of this study is to highlight the consequences of such differences on the portfolio...

Kahneman and Tversky's approach to preference under uncertainty is aversion to loss realization. This paper is an attempt to highlight this phenomenon with a unique approach. In order to beat the market fund managers are required to manage their portfolio at regular intervals. The tendency to...

Shariah-compliant equity investors have the freedom to choose an investment style provided their selection of equities follows approved Shariah screening guidelines. This study proposes the Markov Regime Driven Style allocation (MRDS) strategy for portfolio construction, a forward-looking...

Shariah-compliant investment guidelines, while explicit on screening criteria for stock selection, are silent on the weighting methods to be used in the construction of Shariah-compliant equity portfolios. The market capitalization-weighted strategy and smart beta strategies (fundamental...

Smart beta strategies (SBs) are quite popular in passive investing due to their ability to outperform conventional market capitalization-weighted (MCW) portfolios. This paper investigates the impact of SBs in the case of constrained portfolios such as Shariah-compliant equity portfolios (SCEPs)...

We perform the most comprehensive test of long-term reversal in national equity indices ever done. Having examined data from 71 countries for the years 1830 through 2019, we demonstrate a strong reversal pattern: the past long-term return negatively predicts future performance. The phenomenon is...

The Shariah-compliant equity investments make implicit bets and do not invest in firms with non-compliant core operations. The negative screens are implemented in two steps, qualitative screens and quantitative screens. There exist significant discrepancies among the existing Shariah screening...