Is QQQM Halal?
QQQM (Invesco NASDAQ 100 ETF) is heavily weighted toward technology — but is it Shariah-compliant? The answer requires stock-level analysis.
Quick Answer
- 1QQQM is NOT formally Shariah-screened — it tracks the Nasdaq 100 without any Islamic screening methodology, and is not certified by any Shariah supervisory board.
- 2Many of QQQM's top holdings (Apple, Microsoft, NVIDIA, Alphabet, Meta) individually pass common Shariah screens, but the fund also contains non-compliant holdings including some financial and alcohol-related companies.
- 3Muslim investors seeking tech-heavy exposure should consider SPUS (which naturally tilts toward tech after excluding financials) or screen individual Nasdaq stocks using a recognized methodology.
Screening Results
| Criterion | Result | Threshold | Status |
|---|---|---|---|
| Financial sector revenue (riba) | ~1–2% | <5% | Pass |
| Alcohol-related holdings | Present (varies) | <5% | Fail |
| Individual stock debt ratios | Some fail >33% | <33% | Fail |
| Shariah supervisory board | None | Required | Fail |
| Published purification ratio | None | Required | Fail |
| Overall Shariah compliance | Not certified | Certification required | Fail |
01What Is QQQM?
QQQM is the Invesco NASDAQ 100 ETF, a lower-cost share class of the popular QQQ fund. It tracks the Nasdaq-100 Index, which includes the 100 largest non-financial companies listed on the Nasdaq exchange.
Because the Nasdaq is historically heavy in technology and growth companies, QQQM has a significant tech weighting — typically 50–60% of the fund. Top holdings include Apple, Microsoft, NVIDIA, Amazon, Alphabet, Meta, Broadcom, and Tesla.
The Nasdaq-100 already excludes pure financial companies (banks, insurance), which makes it closer to passing Shariah screens than VOO or VTI. However, it is not a screened fund and contains companies in other prohibited categories.
02Why QQQM Is More Nuanced Than VOO
Unlike VOO, QQQM does not have massive financial sector exposure — the Nasdaq-100 structurally excludes pure-play financial companies. This removes the single largest disqualifier that affects broad market indices.
However, QQQM still contains non-compliant holdings. Some Nasdaq-100 companies fail the AAOIFI financial ratio screens (debt exceeding 33% of market cap). Others derive revenue from prohibited activities — for example, companies with alcohol distribution segments, or those with significant interest income from cash holdings.
The complication is that QQQM's compliance status depends on which stocks happen to be in the Nasdaq-100 at any given time, and how each individual stock scores against Shariah screening criteria. This makes it a fund that requires stock-by-stock analysis rather than a simple pass/fail at the fund level.
Critically, QQQM has no Shariah supervisory board and no published purification ratio. Even if most holdings individually pass screening, the fund itself is not certified or monitored for ongoing compliance.
03Halal Alternatives for Tech-Heavy Exposure
SPUS naturally tilts toward technology because its AAOIFI screening excludes financials — the same sector the Nasdaq-100 avoids. After screening, SPUS typically has 35–45% technology weighting, making it a reasonable proxy for tech-heavy exposure within a Shariah-compliant wrapper.
For investors specifically seeking individual tech stocks, Halal Terminal's screening tool can evaluate each Nasdaq-100 component against AAOIFI, MSCI, and other standards. Many of the top holdings (Apple, Microsoft, NVIDIA) consistently pass screening, though this can change at any quarterly review.
The key difference is intentionality: investing in individually screened tech stocks or a Shariah-certified ETF like SPUS provides certainty of compliance. QQQM does not offer this assurance.
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Frequently Asked Questions
Compliance classification: [EDUCATIONAL]
This content is for educational and informational purposes only. It does not constitute investment advice, a recommendation, or an offer to buy or sell any security. Shariah compliance assessments are based on publicly available data and established screening methodologies. They are not religious rulings (fatwas). Investors should consult a qualified Shariah scholar and a licensed financial advisor before making investment decisions.
All data is sourced from public filings and third-party providers. Compliance status is subject to change at quarterly reviews. Past performance is not indicative of future results. Halal Terminal is not a broker-dealer or investment advisor.