Online Islamic brokerage targets man in the street

Online Islamic brokerage firm ihilal.com, which went live yesterday, aims to bring Islamic investments to the man in the street. "Most Islamic investments are made through face-to-face transactions, and until now have been limited to high networth individuals.

Lots of Islamic mutual funds have an investor entry level of $500,000 to $1 million. ihilal.com aims to break that by targeting the retail investor. For example, an investor can open a trading account with us with just $1,000," chief executive Ramzi Abu Khadra said.

Started about a year ago by Accenture and Rasmala (a private equity group in Dubai), ihilal.com has offices in the Dubai Internet City, the U.S. and Guernsey. It has joined Samba, Orbitex and NCB of Saudi Arabia to offer Sharia compliant mutual funds.

Abu Khadra believes the market is big enough to accommodate IslamiQ.com and indirect competitor CSFB direct. "Against 50 per cent Internet penetration in some parts of North America and Europe, the Internet has reached only 1 to 1.5 per cent of households in the Middle East on average. But the important point is that there are 10 to 15 million adult Muslim investors on the Internet, which is our target market. Many of these are in the Middle East. And we are here too."

However, there are more than eight million Muslims in North America and more than two million in the UK. Abu Khadra estimated that $150-$200 billion in Islamic assets is under management globally.

The site has several features including free research, news, stock quotes and an Investor Education Centre. Its ihilal Islamic Stock Filter screens firms according to Dow Jones Islamic Market Index processes. ihilal does not permit options or margin trading and short selling. Two Sharia advisors - Sheikh Nizam Yaqoobi and Sheikh Yusuf Talal DeLorenzo - will ensure Sharia' compliance.