Hejaz Equities Fund Active ETF (ASX:ISLM) Expands Sharia-Compliant Access to Global Equities

Aditi Sarkar

27 August 2026 04:11 PM AEST

Hejaz Equities Fund Active ETF (ASX:ISLM) Expands Sharia-Compliant Access to Global Equities

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Highlights

Hejaz Equities Fund Active ETF (ASX:ISLM) provides actively managed exposure to global equities under Sharia-compliant principles.
The ETF excludes sectors such as conventional finance, alcohol and gambling while focusing on screened global companies.
At the time of writing on 27 August 2026, ISLM was trading at AUD 1.170, up 0.86%.
At the time of writing on 27 August 2026, the ETF’s indicated Dividend Yield was 6.08%.

Ethical and values-based investing has gained wider attention among Australian investors seeking alternatives to traditional Investment approaches. Hejaz Equities Fund Active ETF (ASX:ISLM) provides access to global equities through a Sharia-compliant framework, applying Islamic investment principles to portfolio construction. While the ETF offers diversified international Equity exposure, investors should consider how its screening process influences sector allocation, portfolio composition and income generation.

ETF Overview

ISLM is an actively managed ETF investing in global equities selected according to Sharia principles. The fund applies screening criteria that exclude companies involved in activities such as conventional interest-based financial services, alcohol, gambling and other restricted industries.

The investment approach also considers financial measures, including Debt levels and income sources, to ensure companies meet Sharia compliance requirements. Any incidental non-compliant income is handled according to the fund’s purification process.

The screening methodology results in a portfolio that can differ significantly from conventional global equity funds. The ETF provides exposure across a range of industries while maintaining alignment with its ethical investment framework.

At the time of writing on 27 August 2026, Hejaz Equities Fund Active ETF (ASX:ISLM) was trading at AUD 1.170, up 0.86%. At the time of writing on 27 August 2026, the ETF’s indicated dividend yield was 6.08%.

Market Focus

ISLM has attracted attention as one of the Sharia-compliant investment Options available to Australian investors seeking globally diversified equity exposure.

The fund’s screening process creates a distinct portfolio profile compared with broader global equity benchmarks. By excluding conventional financial companies and businesses involved in restricted activities, the ETF may have higher exposure to sectors such as technology, healthcare and industrials.

Demand for ethical and values-based investment solutions has increased as investors look for portfolios that align with specific principles while still providing access to global markets.

Income Profile

ISLM provides exposure to global equities while also offering a distribution component. At the time of writing on 27 August 2026, the ETF’s indicated dividend yield was 6.08%.

For actively managed equity funds, distributions may reflect a combination of company income, portfolio activity and realised gains. As a result, distribution levels can change depending on market conditions and portfolio performance.

Since the fund operates under Sharia principles, its income profile differs from conventional funds due to restrictions on interest-based income. Investors should consider that distributions are not fixed and may vary over time.

Growth Drivers

Future performance of ISLM will depend on global equity market conditions, company Earnings growth and the performance of sectors represented within the portfolio.

The ETF’s exposure to areas such as technology, healthcare and industrial companies could benefit from long-term themes including innovation, digital transformation and global economic growth.

Investor interest in ethical and faith-based investment strategies may also influence Demand for Sharia-compliant funds. However, portfolio returns will continue to depend on underlying company performance, market conditions and active management decisions.

Key Risks

ISLM carries global equity market risk, including exposure to changes in company earnings, economic conditions and investor sentiment across international markets.

The Sharia screening process limits exposure to certain sectors, which can cause performance to differ from broader global equity indices. This sector positioning may benefit returns during some market environments but may create challenges when excluded industries outperform.

The ETF also carries currency risk due to international holdings and active management risk associated with portfolio selection. Distribution levels may change depending on investment outcomes and should not be considered guaranteed future income.

Final Takeaway

Hejaz Equities Fund Active ETF (ASX:ISLM) provides investors with access to global equities through a Sharia-compliant investment framework. The ETF combines ethical screening with active portfolio management, creating a differentiated approach compared with traditional global equity funds. While its indicated yield adds an income component, investors should consider the impact of sector exclusions, global market movements and portfolio construction on future outcomes.

FAQs

Q: What is Hejaz Equities Fund Active ETF (ASX:ISLM)?

A: ISLM is an actively managed ETF providing Sharia-compliant exposure to global equities.

Q: What is the indicated dividend yield of ISLM?

A: At the time of writing on 27 August 2026, the indicated dividend yield of ISLM was 6.08%.

Q: What was ISLM trading at on 27 August 2026?

A: At the time of writing on 27 August 2026, ISLM was trading at AUD 1.170.

Q: What sectors does ISLM invest in?

A: ISLM invests across screened global companies, with exposure to sectors such as technology, healthcare and industrials.

Q: What are the main risks of ISLM?

A: Key risks include global equity volatility, currency movements, sector exclusions and changes in distribution levels.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.