Is Amana Growth Fund (AMAGX) Halal?

Do the halal screening authorities agree?

How we read the evidence

HalalWallet's editorial synthesis of the screens, scholar positions, and sources documented on this page — not a religious ruling.

AMAGX, the Amana Growth Fund, is one of the oldest and best-known halal funds in the United States, run by Saturna Capital, which has applied Islamic screening to the Amana Funds since 1986. It is an actively managed mutual fund — a portfolio manager selects the holdings rather than tracking an index — with a large-cap growth style, a concentrated book, and famously low turnover. That low-turnover, quality-focused approach lines up naturally with Islamic principles, which discourage speculation and excessive debt.

What makes it genuinely halal is the screening and the governance behind it. Saturna developed its screening process in collaboration with scholars of the Fiqh Council of North America and runs it through its proprietary NEPTUNE system, which grades thousands of securities monthly. Companies in prohibited sectors are excluded outright, and the remaining names must clear financial limits: interest-bearing debt under 33% of market cap, accounts receivable under 45% of assets, and less than 5% of revenue from impermissible sources. Crucially, an unaffiliated board of scholars — Amanie Advisors — reviews the portfolios quarterly, so compliance is monitored on an ongoing basis rather than certified once and forgotten.

The practical trade-offs are cost and style. As an actively managed mutual fund, AMAGX carries a higher expense ratio than a passive screened ETF like SPUS or HLAL, and its growth tilt means it will behave differently from a broad screened index in different markets. Because even screened companies earn a little incidental interest, a small purification is appropriate — Saturna screens to keep impermissible revenue under 5%, and our purification calculator can estimate the amount to donate. For a Muslim investor who wants active management and one of the longest halal track records available, AMAGX is a well-established, scholar-supervised option; hold it long-term and avoid margin.

Business Activity Screen

An actively managed U.S. mutual fund seeking long-term capital growth, principally following a large-cap growth style. It holds a concentrated, low-turnover portfolio of screened, quality growth companies (historically tech, healthcare and consumer names).

Saturna Capital, the adviser, is solely responsible for security selection and Shariah compliance, using a screening process developed in collaboration with scholars of the Fiqh Council of North America and its proprietary NEPTUNE research system. Companies in prohibited sectors (conventional banking/insurance, alcohol, gambling, tobacco, pork, weapons) are excluded, as are companies breaching the financial screens: debt greater than 33% of market cap, accounts receivable over 45% of total assets, or more than 5% of revenue from impermissible sources. An unaffiliated Shariah board, Amanie Advisors, reviews all Amana portfolios quarterly to certify ongoing compliance.

Conditions

Perform purification on the small residual non-compliant (incidental interest) income; the funds screen holdings to keep haram revenue under 5%. Hold for the long term and avoid margin/short-selling, consistent with the fund's low-turnover, speculation-averse mandate.

Scholars' & Screeners' Positions

Published positions, cited as stated. Screeners can reach different conclusions on the same company because of ratio timing and methodology differences — we report the disagreement rather than flatten it.

• Amanie Advisors (Amana Funds' Shariah board)

  An unaffiliated board of Shariah scholars reviews all Amana Funds' portfolios quarterly to certify that holdings meet Islamic requirements; the screening methodology was developed with scholars of the Fiqh Council of North America.

  Source →

• Mainstream AAOIFI-aligned view

  An actively screened equity fund that excludes impermissible sectors, enforces AAOIFI-style debt/receivables/revenue limits, and provides for purification is permissible for Muslim investors, subject to purifying residual income and avoiding leverage.

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Purification

Even screened companies earn small amounts of incidental interest on corporate cash, so a small purification is appropriate. Saturna screens to keep impermissible revenue under 5%; use our purification calculator with the fund's disclosed income to estimate the amount to donate.

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