The Sharī'ah-compliant risk transfer mitigation techniques developed by experts in the Islamic finance industry include:

Question

Quizplus · Accepted Answer

All the options listed (A, B, C) are indeed techniques developed within the Islamic finance industry to comply with Sharī'ah law, which prohibits interest (riba) and speculative transactions (gharar). These techniques are designed to facilitate risk mitigation and financial transactions in a way that is compliant with Islamic principles. Swaps in Islamic finance often involve the exchange of assets or liabilities without the transfer of interest. Options like bay al-arbun allow a buyer to secure a purchase with a deposit that can be forfeited if the buyer chooses not to complete the transaction, serving a similar purpose to conventional options. Futures in Islamic finance, such as salam contracts, allow for the prepayment for goods that will be delivered in the future, and commodity futures are structured in a way to comply with Islamic law, avoiding speculative transactions.

The Sharī'ah-Compliant Risk Transfer Mitigation Techniques Developed by Experts in the Islamic