How to Purify Stocks: A Step-by-Step Guide

๐Ÿ“š Books & Weekend Reads Blog
#1

When it comes to halal investing, one concept that's often met with considerable confusion is the act of purification. The intricacy of this process often leads to misunderstandings or skepticism, making it seem like a daunting task for many investors.

This is a companion discussion topic for the original entry at https://blog.zoya.finance/stock-purification-guide/
#2

As Salamu alaikum,
If I do a Purification, do I have to sell part of the shares I own or is it enough if I do the entire cleanup with the dividends I receive?

#3

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I have MSCI Islamic ETFs and want to purify my shares based on the following methods

  • Dividend purification method: Only the dividends earned are purified by donating the percentage of non-compliant income (also known as the purification factor).
  • AAOIFI method: The exact amount of non-compliant income attributable to each share is calculated. This amount per share is then purified on an annual basis.

I have this data from the ETF (attached)

Assuming i have 200 shares of this ETF

What is the amount of money i should purify after receiving the dividends and also on an annual basis (aaoifi method)?

Thanks in advance

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