Shariah compliant securities / Nor Suhaira Jamil and Hamizah Hassan

The history of Shariah index in Malaysia began when Kuala Lumpur Stock Exchange Shariah Index (KLSI) is launched in April 1999 in response to the increasing demands and interests in Shariahcompliant investments (Mcgowan & Muhammad, 2010). Previously, all securities are traded in Kuala Lumpur Composite Index (KLCI), until 2006, when Bursa Malaysia partnered with Financial Times Stock Exchange (FTSE) to provide a suite of indices for the Malaysian market. As a result, on 22 January 2007 and 21 May 2007 Bursa Malaysia has launched FTSE Bursa Malaysia Hijrah Shariah Index and FTSE Bursa Malaysia EMAS Shariah Ind ex respectively (“FTSE Bursa Malaysia Indices”, 2016). In Malaysia, the process of identification of Shariahcompliant securities is known as Shariah screening. It is conducted in May and November every year by the Shariah Advisory Council (SAC) of the Sec urities Commissions (SC). Since the first list of Shariahcompliant securities is introduced in 1997, the number of Shariahcompliant securities traded on Bursa Malaysia has risen from 52% in 1997 to 90% in May 2011, which is the highest recorded number. F urthermore, since 2003, the number of Shariahcompliant securities has always remained between 80% and 90% of the total securities traded on Bursa Malaysia (Yazi, Morni, & Saw, 2015). The latest list of Shariahcompliant securities is published by the SAC are Shariah on 29 November 2019 and exhibits 77% of the securities listed on Bursa Malaysia compliant, which consist of 696 securities (“List of Shariah the SAC of the SC”, 2019).