FINalternatives has reported the recent launch of a Sharia compliant hedge fund by Los Angeles-based Palisades Park Capital. The firm unveiled its Mizaan LP fund this past November. Omar Haroon, who manages the funds along with Justin Doff, explained that with the Mizaan fund, he aims to help make hedge funds available to foundations, endowments and other investors that may have laws forbidding some types of investments. 

“There aren’t many options for Muslim Americans to invest their money in ways that are halal – which means permitted under Islamic Law,” Haroon told FINalternatives.

“Both funds utilize the same underlying strategy,” said Haroon to FINalternatives, adding that the only difference between the two offerings is that “the Mizaan fund doesn’t invest in industries deemed to be counter to Islamic law,” such as alcohol, gaming, and hospitality companies.

The funds employ a computer-based long-short strategy, and while the portfolio managers are only investing in domestic equities for now, Haroon said the strategy is capable of handling forex and commodities, and they may utilize these strategies in the future.

The Mizaan fund does not currently employ an Islamic scholar, as is done by many Sharia-compliant funds. But as part of his due diligence, Haroon, who is active in Muslim organizations and in the community says, “We do consult with scholars and keep an eye on the holdings of other Sharia-compliant funds.”

Haroon and Doff previously worked as financial advisors at UBS.

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