Sukuk in Islamic Capital Market

Abstract

This chapter is about Sukuk in the Islamic capital market (ICM). Sukuk is regarded as an important instrument in the ICM. Moreover, Sukuk is regarded as a unique structure with specific features that distinguish it from other types of instruments such as bonds, shares, and securitization. These features bring along with them various benefits to the issuers and investors as well. There are some Shariah rules and principles that should be observed in dealing with Sukuk in the stage of issuance as well as when trading in the secondary market to ensure its Shariah-compliant status. This chapter covers important aspects of Sukuk such as its definition and concept, characteristics of investment Sukuk, the Shariah foundation of Sukuk, and risk factors in Sukuk.