Fantastic initiative Zoya!
I have spent hours and days in the last few months trying to understand the various criteria, methodologies and schools of thought, and to select an approach that I would like to apply and follow for my investments. Unfortunately, as is the case in other aspects of life, there is so much difference of opinion between reputed scholars and organisations, that it has become quite challenging for me to seek the answer on my own.
Q. Please help me understand logically the following points:
- Liquid assets
A company, especially nowadays with ground-breaking and ingenious innovations that we are seeing, is surely much more than the cash or other assets it has. Does this ratio (still) really makes sense?
- Illiquid assets
Similar to above. Consider Airbnb (ABNB) when looking at this. Airbnb had become a universal example of innovation wherein it is touted as ‘The world’s largest accommodation provider, but with no real estate of its own’. Unfortunately, Shariah application doesn’t seem to be evolving to consider such innovations and radical business models.
- Interest-bearing Debt
Shouldn’t it be the interest expense rather than the debt that should be considered?
Jazakallah for your assistance dear community.