Islamic financial services company UM Financial Inc. has teamed up with Jovian Capital Corp. (JOV-T 7.500.456.38%)in a bid to list Canada's first sharia-compliant exchange-traded fund (ETF).
On Wednesday, Standard & Poor's launched the S&P/TSX 60 Shariah Index. In compliance with Islamic law, the index avoids firms involved in financial services, alcohol, gambling and pork products.
The proposed product from UM and Jovian would be based on the S&P/TSX 60 Shariah Index so the two firms are in discussions with Standard & Poor's to get a licence for the new index to start the Islamic ETF later this year. Eventually, "the goal is to launch a family of ETFs," UM chief executive officer Omar Kalair said yesterday.
The sharia ETF would target Canada's Muslim population (which numbers about one million), as well as foreign investors, Mr. Kalair said in an interview.