The fund's biggest difference is it does not deal in interest-based products. Photo / Thinkstock
The fund's biggest difference is it does not deal in interest-based products. Photo / Thinkstock
New Zealand's first Islamic KiwiSaver fund has been launched with a promise not to invest in alcohol, Western entertainment or pornography.
The Amanah KiwiSaver Plan was registered last year and, ahead of yesterday's official launch, has about 200 members.
It will invest in line with Sharia law, ruling out manyinvestment funds, and also requiring interest "purification payments".
"It's a very back-to-basics investment style," said barrister Brian Henry of Goldman Henry, which operates the fund. "We invest in companies making something people want, real estate that is debt-free, and farming."
Henry said the fund's biggest difference was that it did not deal in interest-based products.
Investors do not have to have any connection to Islam to join the Government-approved fund, but need to know it has an ethical mandate not to invest in companies that produce pork, alcohol, tobacco or pornography. It also avoids derivatives because of the Sharia prohibition on gambling.
Investments must involve a shared risk, such as shares that would rise or fall with the company's fortunes. It is currently invested in stocks such as Apple, Facebook and Google.
The main fund is targeting 10-14 per cent growth in US dollar terms year-on-year.
