Fund
Is S&P 500 index ETF halal?
Not permissible
Read our methodology and editorial policy.
Short answer
Generic S&P 500 ETFs like SPY or VOO contain dozens of companies that fail the activity screen — major banks, conventional insurers, alcohol producers. Use a shariah-screened index fund instead.
The reasoning
A passive S&P 500 fund cannot be cleaned up after the fact. The fund manager will not divest from JPMorgan or Anheuser-Busch on your behalf.
The accepted alternative is a shariah-compliant index fund such as the SP Funds S&P 500 Sharia ETF (SPUS), the Wahed FTSE USA Shariah ETF (HLAL), or equivalents tracking AAOIFI or DJIM index methodologies.
Conditions
- Replace with SPUS, HLAL, ISUS, or an equivalent shariah-screened equity fund.
Red flags
- Buying SPY, VOO, IVV, or any standard S&P 500 tracker as a 'core' holding.