Reference
Glossary
Every Islamic finance and investing term, defined in plain English. Each entry includes the Shariah perspective where relevant.
Core Concepts
Riba, gharar, halal, haram — the foundations
Excessive uncertainty or ambiguity in a financial contract.
Permissible under Islamic law.
Prohibited under Islamic law.
Gambling or speculation where one party gains at the direct expense of another.
Donating the small portion of investment returns that may have come from non-compliant sources.
Interest charged or earned on a loan or deposit.
Islamic law, derived from the Quran and the Sunnah of the Prophet.
The obligatory annual charitable contribution on wealth above the nisab threshold.
Structures
Musharaka, murabaha, ijara — how halal products work
A shared ownership structure where one party gradually buys out the other.
An Islamic lease where the bank owns the asset and rents it to you.
A profit-sharing partnership where one party provides capital and the other provides expertise.
A cost-plus sale where the seller discloses the cost and profit margin upfront.
A partnership where profits and losses are shared between parties.
Products
Sukuk, takaful, halal ETFs
An exchange-traded fund that only holds companies passing Shariah screening criteria.
A halal alternative to a mortgage that uses shared ownership or leasing instead of interest.
An Islamic bond that gives you a share of an asset's profits instead of fixed interest.
Islamic mutual insurance where members contribute to a shared pool and support each other.
Account Types
ISA, SIPP, GIA, JISA
A General Investment Account — a standard investment account with no tax advantages.
A Stocks and Shares ISA holding only Shariah-compliant investments.
A tax-free investment account for children, unlocked when they turn 18.
A Self-Invested Personal Pension — a pension you control yourself, choosing your own investments.
A UK account where investments grow completely free of income tax and capital gains tax.
Investing Basics
Return, risk, diversification, compound growth
Growth on top of previous growth — your returns generate their own returns over time.
Spreading your money across many different investments to reduce the impact of any single one failing.
The gradual rise in prices over time, which erodes the purchasing power of money held in cash.
The complete collection of all your investments.
Adjusting your portfolio back to your intended allocation when it has drifted due to price movements.
The profit or loss you make on an investment, usually expressed as a percentage.
The possibility that an investment will perform worse than expected, including losing money.
How much an investment's value fluctuates up and down over time.