S&P Shariah uses a 36-month trailing average market cap, even longer than DJIM. The receivables threshold is also more permissive at 49%, the most generous of all Shariah methodologies on this metric.
What it is
S&P Dow Jones Indices' Shariah index family, distinct from DJIM in its longer smoothing window and looser receivables cap.
When it gives different verdicts
Asset-light service businesses with high accounts receivable (consulting firms, IT services) often pass S&P Shariah but fail FTSE Yasaar or MSCI Islamic. Companies with volatile recent market caps benefit from the 36-month smoothing.
Who uses it
S&P Funds, SPUS (SP Funds S&P 500 Sharia Industry Exclusions ETF), and certain global Shariah index ETFs.
Financial ratios
- Interest-bearing debt / 36-mo avg market cap< 33%
- Cash and interest-bearing securities / 36-mo avg market cap< 33%
- Accounts receivable / 36-mo avg market cap< 49%
- Non-permissible income / Total revenue< 5%
Who uses it
- SPUS ETF
- S&P Shariah index funds globally
Sources
- S&P Shariah Indices Methodology
- S&P Dow Jones Indices
Type any ticker into the screener and see the S&P Shariah verdict alongside the other 8 frameworks.
Open the screener