A PROPOSAL FOR CONSTRUCTING AN ISLAMIC MONEY MARKET FUND FOR THE TURKISH MARKET

Abstract

Islamic finance is widely considered to be underutilized in Turkey. One of the reasons is the lack of proper investment vehicles to cater the need of investors with interest sensitivity. Participation banks only offer time deposit accounts with more than 30 days maturity. Investors with shorter term liquidity are facing with leaving their money in demand deposit accounts and losing alternative return or moving to the conventional investment vehicles. In this article, we propose to construct an Islamic money market fund in order to protect capital and provide some return for the corporate and individual investors with interest sensitivity. In this context we expect that Islamic money market fund would also help the growth of Islamic finance in Turkey.