Islamic Capital Markets

Sukuk are Shari'a-compliant certificates which are issued in order to raise finance in a Shari'a-compliant manner and, like conventional bonds, can be listed on international exchanges and, if structured properly, will be tradable instruments in the international markets.  However, there are also significant differences between sukuk and conventional bonds, including the fact that sukuk, as trust certificates, are not debt instruments and instead convey a beneficial ownership interest in one or more underlying assets. 

In addition, the periodic payments on sukuk are not interest but instead represent a return earned through the underlying assets, for example on an ijara (lease) based sukuk the periodic return represents the rental payments made on the underlying lease.