SP Funds S&P 500 Sharia Industry Exclusions ETF (SPUS)

Overview

The SP Funds S&P 500 Sharia Industry Exclusions ETF (SPUS) seeks to track the performance of the S&P 500 Shariah Industry Exclusions Index, providing exposure to large-cap U.S. equities while adhering to Sharia investment principles. It excludes companies involved in industries such as conventional finance, alcohol, tobacco, gambling, pork, and defense. The fund uses a passive management strategy to replicate the index.

Reputation and Reliability

SP Funds is a smaller ETF issuer known for its Sharia-compliant investment products. Their reliability is established through adherence to Sharia standards and regulatory compliance.

Management Expertise

SP Funds' management team possesses expertise in both ETF management and Sharia-compliant finance, ensuring the fund's objectives are met effectively.

Goal

The fund's goal is to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P 500 Shariah Industry Exclusions Index.

Investment Approach and Strategy

Strategy: The fund aims to track the S&P 500 Shariah Industry Exclusions Index, a benchmark that screens out companies not compliant with Sharia law from the S&P 500.

Composition The ETF holds stocks of large-cap U.S. companies that pass Sharia-compliant screens, excluding those in prohibited industries.

Market Share: SPUS has a relatively smaller market share compared to broader S&P 500 ETFs and other Sharia-compliant funds.

Total Net Assets (AUM): 163440262

Key Competitors

• HLAL
• SPRH

Competitive Landscape

The competitive landscape includes other Sharia-compliant ETFs, each with slightly different screening methodologies and expense ratios. SPUS competes on its tracking accuracy to the S&P 500 Shariah Industry Exclusions Index and its relatively low expense ratio compared to its peer. SPUS's key advantage lies in its direct adherence to the well-known S&P 500 index with Sharia compliant screening, while a potential disadvantage is its narrower investment universe which might lead to underperformance relative to the broader S&P 500.

Historical Performance: Historical performance data should be sourced from reputable financial data providers to see returns over various periods (e.g., 1-year, 3-year, 5-year, 10-year).

Benchmark Comparison: Compare SPUS's returns to the S&P 500 Shariah Industry Exclusions Index to assess tracking efficiency.

Expense Ratio: 0.49

Average Trading Volume

SPUS has a moderate average trading volume, which can impact the ease of buying and selling shares.

Bid-Ask Spread

The bid-ask spread is generally tight, but can widen during periods of market volatility.

Market Environment Factors

Economic conditions, interest rates, and investor sentiment towards large-cap equities influence SPUS. Sector performance (excluding Sharia-non-compliant sectors) and the overall equity market trends also play a significant role.

Growth Trajectory

The growth trajectory of SPUS depends on the increasing interest in Sharia-compliant investments and the performance of the eligible S&P 500 constituents. Strategy and holdings are likely to remain relatively stable, tracking the underlying index closely.

Competitive Edge

SPUS offers investors a Sharia-compliant alternative to traditional S&P 500 investing, catering to a specific ethical and religious investor base. Its competitive advantage lies in its adherence to Sharia principles, combined with the broad market exposure of the S&P 500. This provides a unique offering in the ETF market. SPUS offers a compelling option for investors seeking ethical or faith-based investing strategies.

Volatility

SPUS's volatility is generally similar to the S&P 500, although the industry exclusions can lead to slight deviations.

Market Risk

SPUS is subject to general market risk, as well as sector-specific risks related to the exclusion of certain industries. Its performance is tied to the performance of its constituent stocks, making it susceptible to economic downturns and market corrections.

Ideal Investor Profile

The ideal investor is seeking Sharia-compliant investment options and exposure to large-cap U.S. equities, aligning with their religious or ethical beliefs.

Market Risk

SPUS is suitable for long-term investors seeking a diversified portfolio that adheres to Sharia principles. It is generally a buy-and-hold investment.

SP Funds S&P 500 Sharia Industry Exclusions ETF (SPUS) offers exposure to large-cap U.S. equities while adhering to Sharia investment principles, excluding companies involved in prohibited industries. It is designed for investors seeking Sharia-compliant investment options with similar risk/return characteristics to the S&P 500. SPUS's performance is closely tied to the S&P 500 Shariah Industry Exclusions Index, making it suitable for long-term investors seeking diversified, ethical investment choices. However, investors should consider the expense ratio and liquidity when making investment decisions.

• HLAL
• ISHL
• AMAG

Data Sources:

• SP Funds Website
• ETF.com
• Morningstar

Disclaimers:

This analysis is for informational purposes only and should not be considered investment advice. Investment decisions should be made based on individual circumstances and after consulting with a qualified financial advisor. Data is based on available information and may be subject to change.