Chapter 13
Investing in Islamic Bonds: Sukuk
In This Chapter
Contrasting sukuk and conventional bonds
Finding out how sukuk are traded, rated, and issued
Scouting sukuk products
Tracing the sukuk market’s evolution
As I note in Chapter 11, the Islamic capital market features various investment instruments that fall into two broad categories: sharia-compliant equities and sukuk, or Islamic bonds. In this chapter, I focus on sukuk, which comprise one of the fastest growing segments in both the Islamic and global financial industries.
Government and corporate issues from both Muslim and non-Muslim countries are driving the growth of sukuk. At the end of 2011, outstanding sukuk were valued at an estimated $182 billion and growing at a rate of 30 percent per year.
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Sukuk have gained acceptance in some Western countries and companies, boosting their global presence. For example, the German state of Saxony-Anhalt has issued sukuk, as have corporations such as General Electric, East Cameron ...