Islamic Financial Instruments on stock markets in GCC Essay

Islamic Financial Instruments on stock markets in GCC - evidence ExampleThe term Sukuk is an Arabic word that is identical to the aspects of a financial promoter and is an equivalent instrument such as a bond nether Islamic perspective of banking. But contrary to the wonted(prenominal) financial instrument Sukuk is different as there argon no fixed incomes as under the laws of Islam interests are seen as a crime. Therefore as an alternative it has been instrumented to use such non tangible or tangible assets that are could be classified harmonize to the basic non tradability or tradability. But once again, under the principals of Islam these formulations could only be used in the secondary market. (Zia-ud-din, 229)According to the estimation of the Islamic Banking and Financial Institutions The Progress and Probability promulgated in 2005, there are around $521 billion worth of financial assets that are circulating in the fiscal market as per year ending March 2005. (Asif, 337) The entire amount of this investment adjust by principals of Islamic investment plans it could be enumerated that the entire procedure is regulated by the moral and apparitional obligations of the Shariah.Therefore it is seen that the Islamic financials instruments traded on GCC financials markets are huge and there are a number of countries who on a regular basis uses this form of banking. The countries can be enumerated as USA, UK, Yemen, UAE, Turkey, Tunisia, Switzerland, Sudan, Sri Lanka, South Africa, Senegal, Saudi Arabia, Russia, Qatar, Palestine, Pakistan and around 150 countries all everyplace the world. Malaysia is one of the key player of this form of banking. Dallah Al Baraka (Malaysia) Holding Sdn Bhd, Malayan Banking Berhad (Maybank), Kuala Lumpur, Islamic banking & Takaful Dept, Bank Negara Malaysia, linked Malayan Banking Corp. Berhad, Kuala Lumpur, Labuan Offshore Financial Services Authority (LOFSA) and Lembaga Urusan Dan Tabung Haji (Fund), Kuala Lumpur are th e few most valuable financial institutions of the country. (Syyed, 98) The financial institutions that that deal with the instruments can be enumerated as International Islamic Financial Markets, Mudaraba Companies, Takaful Companies (These are basically insurance companies), Islamic Mortgage Companies, Islamic Windows, Islamic Investment Funds and Banks and Islamic Banks. down the stairs these institutions there are different plans such as Mudaraba which are basically Capital trust pay where the basic implementation is the contact which accumulates the ceiling along with the cost. However there are likewise other schemes that are marked up. Then there are also other plans under which leasing comes into consideration. This called Ijara. There is also another technique that is defined Ijara wa Iktin wa which is basically the contract of hire purchase. (Iqbal, 33) The basic limitations of these plans are based on the contracts between the parties but the over all scenarios are b ased on the principals of Islam where a financial instrument like Musharaka is treated as long termed investment under the parameters of equity arrangement. The capital supplied in this case is the bank and the clients. The profit in this case is shared among the concerned parties in according to prior agreement whereas the loss is shared in accordance to the capital invested. On the other extend to another financial instrum