A:

Specialized mutual funds offer investments tailored for particular religions including Judeo-Christian faiths and Islam. As a point of interest, there are also funds for particular geographical regions, like Latin America or Europe; different sectors, like technology or retail; social or ethical beliefs, like those related to the environment or to health.

Religious, or faith-based, funds were created for people who want to invest based on the principles and tenets of their faith. Religious funds are similar to ethical funds, but ethical funds invest in companies based on social issues, while religious funds invest in companies based on moral ones. For example, some companies invest in funds that follow Islamic law, while others seek funds that incorporate Catholic values. (To learn more about this topic, read our related article Ethical Investing.)

Investing in a faith-based fund is just like investing in any other fund. You must find a firm that offers religious mutual funds and then thoroughly research the funds and their performance to make sure they match your investment goals for growth and yield. Contact the firm's customer service department with questions or concerns. When you are satisfied that the fund meets your criteria, including religious adherence, inquire about purchasing.

Getting started on your search for faith-based funds can be as simple as conducting an internet search to find reports on funds that rank sustainability, level of social responsibility and religious affiliation.

To learn more about mutual funds screened for Sharia compliance, read our related article Working With Islamic Finance.

This question was answered by Chizoba Morah.

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