Islamic Banking And Its Principles On Risk Finance Essay - Free Essay Example

Sample details Pages: 4 Words: 1139 Downloads: 7 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? The key element of Islamic banking is that the risks of financial transactions should be evenly divided between depositor and investor, that is between bank and client. Interest in the sense of asking a fee for merely lending money, is prohibited, as long as the lender is not running any risks themselves. Speculative contracts such as futures and options are also forbidden. A practical consequense of these Islamic principles is that the relationship between investor and depositor becomes one of reciprocity. Banks are necessarily more involved with their clients activities. A non-Islamic bank might lend the money to its client, and not bother what he does with it as long as the interest is paid on time. The Islamic bank, on the other hand, wants to make sure that its client is doing well, because their relationship is one of profit-sharing. Don’t waste time! Our writers will create an original "Islamic Banking And Its Principles On Risk Finance Essay" essay for you Create order Islamic banking is based on standard contracts. I will mention a few, to illustrate the point. The Mudaraba contract is the investment of money by either the bank or the client in return for a share in the profits. In this contract only the investor is liable for losses. In the Musharaka, on the other hand, both sides share the risk of loss as well as profit, in proportion to their respective investments. Then there is the Murabaha, which is the sale of materials and equipment by the bank to the client for an amount which is higher than their cost price, and which has to be paid in instalments. The Murabaha is the easiest and least risky contract, because banks know the return on their venture without risking their own capital. Most of the derivatives incorporate gharar (absolute risk), gambling and interest and support speculative activities. Islamic legal rules, particularly the ban on Gharar and on the sale of debt for debt, do not allow transactions devoid of real/productive activities. Derivatives involving such financial contracts which themselves are prohibited in Shariah (Riba based bonds forward foreign exchange where mutual exchange is not simultaneous, for example) are clearly un-acceptable according to the Shariah principles. In case the underlying assets are equities and commodities it would be seen whether or not Riba and Gharar are involved. According to some writers Arbuncan become a basis for developing some kinds of Shariah compliant options contract by which one party buys the right to purchase from the other party specified goods for a specified price on a certain date. Arbun is a void contract according to a Hadith, and the three schools of Islamic law. Only Hanabalah uphold Arbun with the condition imposed by some of them that time should be stipulated for the option. The OIC(Organisation of the Islamic Conference) Fiqh Academy has also endorsed Arbun but only if time limit is specified. Even if Arbun is accepted as valid transaction, most of the derivatives current in the market would still be unacceptable from Shariah angle due to involvement to Gharar and Riba. A Call Option can be considered near to Bai al Arbun in the sense that the seller does not return the premium or advance payment to the buyer in case the latter does not exercise the purchase option and the buyer loses the option premium even if the option is exercised and the contract is confirmed. In case of Bai al-Arbun, however, the option premium is adjusted in sale price when the contract is confirmed. However, this subject of derivatives needs extensive research. When it comes to insurance Islam have their own concept, the main concept of Islamic insurance is that it is an alternative to conventional insurance, with characteristics and features that comply with shariah requirements. This is done by eliminating the objections against conventional insurance. The main features of Islamic insurance are: ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Cooperative risk sharing by using charitable donations to eliminate gharar and riba; ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ clear financial segregation between the participant (insured) and the operator (insurance company); ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Shariah-compliant underwriting policies and investment strategies. I will now explain the points above. Within the Co-op insurance the characteristics of a cooperative include self-responsibility, democracy, equality, equity, solidarity, honesty, openness, social responsibility, and caring for others. While mutuality or cooperative risk sharing is at the core of Islamic insurance, it cannot alone create an Islamic insurance operation. Islamic insurance is based on more than one relationship: The first relationship is a mutual insurance contract between policyholders (contributors) and each other. This is similar to a pure mutual insurance relationship, taking into consideration the concept of donation, Instead of premiums. The main features behind cooperative insurance are: Policyholders pay premiums to a cooperative fund with the intention of it being a donation to those who will suffer losses (tabarru) Policyholders are entitled to receive any surplus resulting from the operation of the cooperative insurance fund. Policyholders are liable to make up for any deficits that result from the operation of the cooperative insurance fund. Clear Segregation Between Participant and Operator: In conventional insurance, the insurance company is a for profit organization that aims to maximise profit by accepting the financial burden of others losses. The insurance company is owned by shareholders who receive any profit and are responsible for financing any deficit. Under Islamic insurance, the system is that the insurance companys role is restricted to managing the portfolio and investing the insurance contributions for and on behalf of the participants.from my research I found that there are four different models in operation: The mudarabh model, the wakalah model, the hybrid mudarabh-wakalah model, and the pure cooperative model (non-profit). The last point is Shariah-Compliant Policies and Strategies: Ethical insurers invest money in a responsible way in industries that are ethically sound and do not harm the environment or people( like the Norwegian pension fund) . Islamic insurance is similar, except that the ethical considerations are extended to those which do not contravene the religion of Islam and are monitored by a shariah board, which is part of the company structure. In particular, the investment and underwriting policies need to be free of any involvement with the prohibited activities of gambling, alcohol, pork, armaments, tobacco, and interest-bearing activities, loans, and securities. Word count: 1529 All Islamic words and economic glossary I used is from: https://www.islamic-world.net/economics/word/b.htm or the websites I used. Websites: ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Institute of Islamic Banking and Finance: www.islamic-banking.com ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Islamic Banking and Finance: www.islamicbankingandfinance.com ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Middle East Insurance Review: www.meinsurancereview.com https://www.pide.org.pk/pdf/psde%2018AGM/A%20Broader%20Definition%20Of%20Riba.pdf https://www.suite101.com/content/what-is-riba-a91216 Other Sources : The previous group works done by my group ( James, Hassan, Ali and me) Handouts given in class (a short review of the historical critique of usury) by Wayne A.M Visser and Alastair McIntosh , searching for the Mecca of finance. ( used them to gain more understanding)

Who Is A Kid Again - 1377 Words

Have you ever wanted to act like a kid again? Most of us have that moment when we have wanted to return to our childhood once more and seek out the innocence held in our young minds. But, for some, they can never go back to their childhood. A demographic in particular? Child soldiers, some 300,000, spread over the Middle East, and ranging anywhere from 16 to 8 years old. These kids have been taken away from their families, homes, and thrusted into the never ending plane of war, where they have to look up to insane morals and unjustified commanders blindly, and without question. Young boys and girls have had everything in their life taken from them, including their psyches and well being. And yet, some believe that to prosecute this†¦show more content†¦The article â€Å"The Child Soldiers Accountability Act of 2007† by Tom Malinowski, an Washington advocacy director, does a excellent job of highlighting the very common case in which child soldiers suffer. â€Å"...c hildren are often separated from their families, driven from their homes, and left with no opportunity to go to school. In situations of extreme insecurity, many believe that joining an armed group is their best chance of protection or survival.† Some may argue the choice children make, and claim it’s the child s fault. They claim that if the kid really wanted to be safe, it would fled to another country, not head into the war. A child should have more common sense, or should at least know that trusting these sources is the completely wrong thing to do. These claims, though, are not true. I think a direct quote from the article â€Å"Child Soldiers: Victims or Perpetrators† explains perfectly why; â€Å"...Once they are recruited the children become over reliant on their commanders for shelter, money, water, drugs and alcohol that they find an extreme difficulty to leave. Children at that young age will rarely ever have the same understanding as an adult.† This children are children, they don’t have a fully developed mind, and can’t possibly call out these fore thoughts before hand. Even after these kids have realized the darker side of the government or rebel group,

Medicine River By Thomas King Essay Example For Students

Medicine River By Thomas King Essay In the novel, Medicine River, Thomas King creates a story of a little communityto reflect the whole native nation. A simply return of Wills makes the littletown seem to be more colourful. Medicine River makes non-native readersthink a little longer and harder about the lives of the first people they liveamong and the places they inhabit. As a non-native reader, it is extradifficult to feel and understand the book because we didnt go through all thesteps. Although Will starts like a foreigner, he becomes part of the uniquecommunity eventually. Medicine River shows the past history of Canada andteaches readers to learn from the past experience in order to become betterpeople. Will is the main character in the novel, Medicine River. The whole storystarts with a native photojournalist returns to his reservation for his mothersfuneral he discovers the strength of his background. Will does not live in thereserve, Medicine River, because his father is a white person. After 20 years,Will returns. After he opens the photo studio in the reserve, he feels like homeagain. Doing business and playing basketball makes Will become a member of thelittle Indian town. The people who help Will the most are Harlen, Louise andJoyce. Harlen is the one who always wants to make Will feel better. The photostudio ; basketball team are Harlens idea. Louise is the true love thatWill falls for. When Joyce asks Will to be in the photo, that really impressesWill a lot. Finally, Will finds his career, love and friends in the reserveafter 20 years. Harlen is Wills friend and he is a very easy going man. He isalways running around helping people to solve the problems. He runs the coachposition on team Medicine River Friendship Centre Warriors after no bodywants to do the job. In order to make Will feel home, Harlen forces Will to playsome basketball on the team although Will is not a good player. Leadership isthe main idea that Harlen is trying to pass to Will. When Louise breaks up withher ex-boyfriend and gets pregnant, Harlen purposely set Louise and Will up. Heasks Will to take a good care of Louise and her unborn baby. Harlen also triesto sell Will on the idea of returning to Medicine River to open shop as the onlynative photographer in the quite, little, mountain town. Louise Heavyman showsthe strong, independent and confident sides of a woman. She owns a financecompany which is well known in the reserve. Louise is a pretty woman who nevergets married. Harlen describes her as, Good looking woman, Will. Stronghips. You know, for children. Tall, too. Always good to have a tallwoman. (P.27) Harlen tries to help Louise by sending Will to have a datewith her. However, Louise does not need any help from anyone else. She tellsWill about her thoughts, He was real nice, but I didnt want to getmarried. I think he thought when I got pregnant that Id change mymind.(P.34) Louise also reminds Will of his mother, Rose. She raised Willand James by herself and Louise is trying to raise South Wing alone. No matterhow strong, independent and confident Louise is, she realizes that she lovesWill and she changes herself a lot after being with Will. Eventually, Louisedecides to start her new live with Will. Even though Louise is not the maincharacter of the novel, she plays a very important roll. The characteristic ofLouises represents the soul of a modern woman, especially of a modern nativewoman. .uef18dbb7bcb3b1f7a28a9fa0da157d89 , .uef18dbb7bcb3b1f7a28a9fa0da157d89 .postImageUrl , .uef18dbb7bcb3b1f7a28a9fa0da157d89 .centered-text-area { min-height: 80px; position: relative; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 , .uef18dbb7bcb3b1f7a28a9fa0da157d89:hover , .uef18dbb7bcb3b1f7a28a9fa0da157d89:visited , .uef18dbb7bcb3b1f7a28a9fa0da157d89:active { border:0!important; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .clearfix:after { content: ""; display: table; clear: both; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .uef18dbb7bcb3b1f7a28a9fa0da157d89:active , .uef18dbb7bcb3b1f7a28a9fa0da157d89:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .centered-text-area { width: 100%; position: relative ; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .uef18dbb7bcb3b1f7a28a9fa0da157d89:hover .ctaButton { background-color: #34495E!important; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .uef18dbb7bcb3b1f7a28a9fa0da157d89 .uef18dbb7bcb3b1f7a28a9fa0da157d89-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .uef18dbb7bcb3b1f7a28a9fa0da157d89:after { content: ""; display: block; clear: both; } READ: A Worn Path - Love Essay In the novel, Medicine River, after a long period of twenty years, Willstill goes back to where he belongs. It does not only happen in an Indian town,but pretty much everywhere else in the world. It is because of the native peopleare too afraid to accept the foreigners. Once the foreigners spend some timethere, people will start to accept and understand the foreigners. Medicine Riverlooks like a regular story to me, but I can feel that there is something greatbehind the story. Unfortunately, I just dont know how to put it in words. It isa good story. Thomas King writes down the book to reflect the whole humannature. In order to improve, we have to encourage ourselves to try and acceptnew things. All the Canadian should be proud of the book because they are thenation with the courage to accept, learn and try things from around the world.

Long Distance Realtionship Are Hard Essay Research free essay sample

Long Distance Realtionship Are Hard Essay, Research Paper Long Distance Relationships Can Be Painful: But They Don # 8217 ; Ts Have to Be I have fallen into a job that many people have had to cover with during some portion of their life, some more than others have. Long-distance relationships are difficult on the bosom, hard on the psyche, and hard on the ego. Many work forces and adult females run into in topographic points that neither of the two will of all time see once more, such as sails, holidaies, and sing far-away relations for long periods of clip. These opportunity meetings sometimes spark fires in the Black Marias of the romantic, which will finally be ended by the inevitable farewell of ways. Many times the speedy crack will be ended unhappily yet expeditiously and both people will seek out love where love is closer to place. Sometimes the passion, the love, and even the lecherousness are so great that go oning some signifier of a relationship is the lone logical measure that the twosome can believe of. The concluding clip together, before the unwanted separation, is normally a sad clip of concluding clinchs and busss. This clip normally fills the twosomes bosom with hurting, because they know this could perchance be the last clip they can look into each other # 8217 ; s eyes, the last clip they can savor each other # 8217 ; s lips, and the last clip they can keep each other near. Continuing the relationship has it # 8217 ; s ain griefs. Waiting for the first mark of correspondence is a long and frustrating delay. The first telephone call is an exacerbating delay, inquiring if the other individual truly wants to name, if the other individual has another lover, or if the other individual has the right phone figure. After the first contact is made, there is normally a period of clip that will find if the twosome wants to go on the whole relationship. When it is apparent that the two will still seek to do their affair work, other jobs may originate. Often there are jobs with parents and/or friends who do non excuse the relationship. In some instances the trip is excessively far to be made more than one time or twice a twelvemonth, and in other instances long-distance twosomes are lacerate apart by the humdrum of letters, phone calls, or electronic mails. Long-distance relationships are difficult, but they can work. The lone type of long-distance relationship that will work, is the relationship in which both spouses accept the distance and attempt to do the relationship physique on that. If a twosome tries to maintain the relationship but allows for other dating, so person is traveling to acquire hurt. Dating other people is all right, if both parties realize that they are merely fri terminals ; otherwise the twosome should ever be faithful to each other. Love is difficult under any fortunes, but when two people are many stat mis apart, love is truly difficult. Communicating is highly of import in any long-distance relationship. Each individual in a long-distance relationship must ever maintain the other informed of his or her well being. Telephone calls, letters, and electronic mail are all tools that will maintain someone’s spouse from acquiring uncertainties about the relationship. When uncertainty creeps into the bosom of person in a long-distance relationship, things start to travel amiss. A sweet missive that comes in the mail, or an unexpected telephone call, will show merely how much he or she means to that individual. The handiness of being able to see person is besides an of import factor in maintaining a long-distance relationship. Once once more, personal forfeit is involved and is ever appreciated. A long trip, for merely one intent, is surely something to maintain any flicker in a relationship. In any relationship, personal contact with a spouse is necessary for the relationship to last. Of class there are other factors that can forestall a long-distance relationship from going a good relationship. Sometimes there are household members, or even close friends that try to deter a twosome from maintaining the relationship traveling. The best manner to acquire to acquire around the jobs in a long-distance relationship is to be able to compromise with the other individual. Keeping a long-distance lover takes a batch of subject and a batch of duty every bit far as being able to let for some things non to ever work out as planned. There will be times that the individual seeking to be reached may non be at place, or unanticipated fortunes could take to a twosome non being able to see each other. These things happen and there is nil that anybody can make about it. If there is adequate love between the two, so junior-grade things like those will non consequence the relationship in any manner. In fact, if there is adequate love between the two, there is nil that can halt a long -distance relationship from blooming into something meaningful. A long-distance relationship can work. There are people who think that no such thing is possible, but through communicating, visiting, and enormous sums of love, any twosome from any distance can hold a relationship that succeeds. The best thing to retrieve in maintaining a long-distance relationship is to ever be happy, that there is person out at that place in the universe, that loves you every bit much as you love them. 34e