Opportunities and Threats of Shariah-Compliant Robo Advisory. The Case of Wahed Invest

Inhaltsverzeichnis (Table of Contents)

• Abstract
• Introduction
• Problem Statement
• Literature Review
• Research Methodology
• Islam and Financial Technology (FinTech)
  • What is Islamic FinTech?
  • What is Robo Advisory (R.A)?
    • Digital Advisory Models and their Clients
    • Benefits of R.A.
• Analysis and Findings
  • Overview of Wahed Invest (New York): A Case Study
  • Shariah-Compliant R.A.
  • The Market for R.A.
  • Market for Shariah-compliant R.A.
  • Future opportunities of R.A.
  • Is R.A a threat for Traditional Advisors?
  • Opportunity (not threat) for Traditional Advisors
  • Opportunity for R.A in the HNW (High Net Worth) market
  • Opportunity for U.S and beyond
  • Opportunity for Banks to implement R.A

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This thesis aims to explore the opportunities and threats presented by Shariah-compliant Robo-Advisory (R.A.) within the Islamic FinTech industry, using Wahed Invest (New York) as a case study. It challenges the prevailing contradiction in research regarding whether R.A. will replace human advisors, arguing instead for its potential to revolutionize Islamic finance.

• The potential of Shariah-compliant Robo-Advisory to disrupt the Islamic finance industry.
• The opportunities for growth and expansion of Shariah-compliant R.A. in various markets.
• The impact of Shariah-compliant R.A. on traditional financial advisors.
• The role of technology in providing access to ethical and Shariah-compliant investment options.
• The specific case study of Wahed Invest and its contribution to the Islamic FinTech landscape.

Zusammenfassung der Kapitel (Chapter Summaries)

Introduction: This chapter introduces the burgeoning field of Robo-Advisory and its rapid growth, particularly among millennial investors drawn to its low costs and potential for high returns. It highlights the significant market potential of Robo-Advisory, projected to reach trillions of dollars, and emphasizes the unmet need for Shariah-compliant options within this growing market, especially for the global Muslim population. The chapter introduces Wahed Invest as a leading example of a Shariah-compliant Robo-Advisor and sets the stage for the thesis's investigation into the opportunities and threats presented by this technology.

Problem Statement: This section identifies the central research question: does Shariah-compliant Robo-Advisory present a threat or an opportunity to the existing Islamic finance industry and traditional financial advisors? It highlights the existing contradictory research on the subject and emphasizes the lack of comprehensive analysis specifically addressing Shariah-compliant Robo-Advisory. This sets the stage for the thesis to provide a nuanced and thorough exploration of this critical issue.

Islam and Financial Technology (FinTech): This chapter delves into the intersection of Islamic principles and financial technology. It defines Islamic FinTech and Robo-Advisory, explaining how Robo-Advisory services can be structured to comply with Shariah law. The chapter discusses the benefits of Robo-Advisory, including increased accessibility and lower costs, highlighting the potential to serve the large underserved Muslim population seeking Shariah-compliant investment options. It sets a foundation for understanding how Wahed Invest operates within the framework of both Islamic finance and technological innovation.

Analysis and Findings: This chapter provides a comprehensive analysis of Wahed Invest, examining its operations, market position, and potential for future growth. It analyzes the market for both traditional and Shariah-compliant Robo-Advisory, exploring the opportunities and challenges faced by each. It also explores the potential impact of Shariah-compliant R.A. on traditional financial advisors, considering both the threats and opportunities presented by this disruptive technology. The chapter offers a detailed examination of various market segments, including high-net-worth individuals and the potential for expansion beyond the US market, emphasizing the broad implications of this technology.

Schlüsselwörter (Keywords)

Shariah-compliant Robo-Advisory, Islamic FinTech, Wahed Invest, ethical investing, halal investments, wealth management, financial technology, artificial intelligence, algorithms, Islamic finance, millennials, high-net-worth individuals, disruptive technology, opportunity, threat, traditional financial advisors.

Frequently Asked Questions: A Comprehensive Language Preview of Shariah-Compliant Robo-Advisory

What is the main topic of this document?

This document is a comprehensive language preview of a thesis exploring the opportunities and threats presented by Shariah-compliant Robo-Advisory (R.A.) within the Islamic FinTech industry, using Wahed Invest (New York) as a case study.

What topics are covered in the Table of Contents?

The table of contents includes an abstract, introduction, problem statement, literature review, research methodology, a section on Islam and Financial Technology (including detailed subsections on Islamic FinTech and Robo-Advisory), and a comprehensive analysis and findings section with a case study on Wahed Invest. The analysis covers the market for Shariah-compliant R.A., its future opportunities, and its impact on traditional advisors.

What are the key objectives and themes of the thesis?

The thesis aims to explore the potential of Shariah-compliant Robo-Advisory to disrupt the Islamic finance industry, examine opportunities for growth and expansion, analyze its impact on traditional financial advisors, and assess the role of technology in providing access to ethical and Shariah-compliant investment options. A key theme is the analysis of Wahed Invest as a case study.

What are the chapter summaries?

The introduction establishes the context of Robo-Advisory and its growth, highlighting the need for Shariah-compliant options. The problem statement defines the central research question regarding the threat or opportunity posed by Shariah-compliant R.A. The chapter on Islam and Financial Technology defines Islamic FinTech and R.A., explaining Shariah compliance. Finally, the analysis and findings chapter provides a detailed examination of Wahed Invest, the market for R.A., and the impact on traditional advisors, covering various market segments and future opportunities.

What are the keywords associated with this thesis?

Keywords include Shariah-compliant Robo-Advisory, Islamic FinTech, Wahed Invest, ethical investing, halal investments, wealth management, financial technology, artificial intelligence, algorithms, Islamic finance, millennials, high-net-worth individuals, disruptive technology, opportunity, threat, and traditional financial advisors.

What is the central research question addressed in the thesis?

The central research question is whether Shariah-compliant Robo-Advisory presents a threat or an opportunity to the existing Islamic finance industry and traditional financial advisors.

What is the significance of Wahed Invest in this thesis?

Wahed Invest serves as a key case study, allowing for a detailed examination of a real-world example of a Shariah-compliant Robo-Advisor and its operations, market position, and potential for future growth.

Who is the target audience for this thesis?

The target audience is likely academics, researchers, and professionals in the fields of Islamic finance, FinTech, and wealth management interested in the impact of technology on the financial services industry, specifically within the context of Shariah compliance.