ADVANTAGES AND RISKS OF ISLAMIC INVESTMENT

Abstract

In the Islamic context, investing is highly recommended so that the future can be guaranteed. Of course, investments made by Muslims must be following Islamic rules. Investing in economy Islamic concepts will provide a sense of security and comfort for Muslim investors, without fear of deviating from Islamic teachings. As a devout Muslim, of course, investment choices must be appropriate and following the concept of Islam. The difference between conventional Islamic investment lies in the benefits given. The advantages of Islamic investment are in the form of profit-sharing, while the conventional concept is interest. In the teachings of Islam, interest is haram, because it does not recognize the value for money. In the view of Islam, the money will not be developed by itself but must go through productive and ruleful efforts. The purpose of making this paper is to discuss the advantages and risks of Islamic investment. This paper uses a literature review approach that comes from journals, books, the internet, and other sources. The results show that the advantages of Islamic investment are riba-free, minimal risk, Islamic management, halal, and promoting social activities. Meanwhile, the risks that may be faced by investors are the risk of losing capital, the risk of uncertainty of return, and the difficulty of selling investment products. From the results, it was found that currently Islamic investment products are favored by non-Muslims alike. The concept of profit sharing is considered more profitable than interest. It can be concluded that Islamic rules can now be accepted by various groups of people in the world.