Is Amazon Stock Halal Or Haram? Facts In 2023

Reviewed by: Shakira Ahmed
Fact Checked by: Shahina Islam

Is Amazon Stock Halal: Learning about halal stocks recently? Questioning whether is Amazon stock halal or haram? We are aware of the growing significance that ethical issues have for investors, particularly those who adhere to Islamic ideals. We hope to inform our readers about the benefits of buying Amazon stock through this article.

Jeff Bezos launched the worldwide technology and e-commerce behemoth Amazon in 1994. The business has experienced exponential growth over time and now provides a vast array of goods and services, such as e-commerce, cloud computing, and digital streaming. We must assess Amazon’s primary business operations and their conformity with Islamic standards in order to ascertain the stock’s halal certification.

Is Amazon Stock Halal?

Muslim investors may view Amazon as a halal investment option. The consensus is that Amazon’s stock passes the Shariah’s screening requirements and that just a negligible portion of its revenue derives from prohibited practices. 

What Makes Amazon’s Stock Haram?

However, due to its involvement in haram acts, such as the sale of goods and services that are prohibited in Islam, the more conservative believers may declare Amazon stock to be unlawful. Let’s read about “Is Amazon Stock Halal”.

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The elements of Amazon’s business that are haram are connected to the goods and services it offers that are forbidden in Islam. Amazon sells a variety of halal goods like books, clothing, household appliances, software, and computer gadgets, but it also offers haram goods like alcohol, pork, and adult content. 

Additionally, while the movies, music, and TV shows available on Amazon may not be fundamentally prohibited, their content may make them so. 

It is crucial to remember that it is unclear how much of Amazon’s revenue comes from haram sources. Therefore, before making any investing decisions, Muslim investors should conduct their own studies.

Financial Highlights For Amazon Stocks To Be Halal.

The basic financial parameters that determine “Is Amazon Stock Halal” are as follows:

• The underlying business operations of the stock shall be compliant with Shariah.
• A number of requirements, including the ratio of interest-bearing debt to total assets, must be met by the company’s financial ratios.
• The corporation cannot derive a sizable portion of its revenue from haram activities, and all of the company’s revenue must originate from halal sources.

Amazon has proved its worth in terms of Islamic compliance by following most of these guidelines. The overall study of the financial highlight of Amazon stock can be compiled as:

• In addition to its digital streaming services, Amazon has seen tremendous development in its e-commerce and cloud computing businesses.
• Amazon has a sound financial position and a history of funding innovative projects in business and technology.
• In terms of business, Amazon is halal with some haram components, though it is unknown how much of its revenue comes from haram sources.
• Despite selling haram goods and services like alcohol, pork, and adult content, Amazon also has a core structure and product offerings that are halal.
• It is debatable whether haram accounts for a sizable portion of Amazon’s revenue.

Interest-Bearing Debt To Total Assets Ratio Of Amazon Stock

One of the financial standards used to establish if a stock is halal is the ratio of interest-bearing debt to total assets. The interest-bearing debt to total assets ratio of Amazon stock is as follows to help comprehend halal Amazon stock:

• As of March 31, 2023, Amazon had $309.85 billion in total debt.
• As of March 31, 2023, Amazon had $763.38 billion in total assets.
• As a result, as of March 31, 2023, Amazon’s interest-bearing debt to total assets ratio was roughly 0.41, or 41% ($309.85 billion divided by $763.38 billion).

Guideline For Choosing Halal Investment Only

Research and cautious thought are required before investing in halal stocks. The following are the detailed criteria for this research:

1. Understand the concept of halal investing: 

Halal investing is the practice of making investments in accordance with Islamic standards. This entails avoiding investments in companies and ventures that deal with pork, alcohol, gambling, or other illegal activities. It also entails avoiding products that pay interest and researching a company’s earnings and debt levels before investing.

2. Research halal investment options: 

Stocks, ETF funds, currencies and cryptocurrencies, precious metals, sukuk (often referred to as Islamic bonds), and real estate are the greatest halal investing possibilities. Finding the best investment option for you requires research and comparison of various financial products and fund managers.

3. Check the accreditation: 

Make sure the investment goods you select have endorsements from credible Islamic financial institutions or experts.

4. Seek professional financial advice: 

Before making any investing decisions, Muslims should speak with Islamic authorities or financial consultants. In addition to screening companies and funds for adherence to Shariah law, they can assist clients in understanding the halal investment possibilities available.

5. Invest in halal-compliant companies: 

Muslim investors should invest in stocks of businesses that aren’t engaged in haram activities. If stocks are involved in activities that are prohibited by Islam, investing in them will be deemed haram. Investing in businesses that make money through interest is haram, but buying stock in a business may be halal if you will only own a small piece of the company and get a small piece of the profits.

Frequently Asked Questions

Conclusion

So, This was all for is Amazon stock halal in Islam. Finding out whether Amazon stock is halal is a difficult undertaking that necessitates a thorough comprehension of both Islamic teachings and the company’s economic activities. Muslims who are unsure whether investing in Amazon is acceptable may choose to speak with knowledgeable academics or financial professionals who are familiar with Islamic finance.