Kazakhstani ITS Exchange Launches ETFs Linked to Its Sharia Stock Index

The ITS international trading platform, headquartered in Kazakhstan, has launched its first-ever ETF (exchange-traded fund) linked to its ITS Sharia Index, aiming to attract Islamic investors with halal trading tools.

Kazakhstan, a Central Asian nation of 20 million people, with 70% of the population identifying as Muslims, is positioning itself as a regional financial centre. It seeks to boost financial services domestically while attracting foreign investors.

ITS, which specialises in trading foreign stocks listed on major US stock exchanges, introduced its ITS Sharia Index in 2023. The US-dollar denominated index gained nearly 20% in 2024, and now ITS offers clients the opportunity to trade the new ETF linked to the index.

The ETF, which trades under the ticker ITSS, represents a significant milestone for the Islamic finance industry in Kazakhstan and the broader region. With a starting price of $10 per share, the instrument is accessible to all investors connected to the ITS platform, which operates from 10:00 to 03:45 the next day, Astana time (04:00 to 21:45 GMT).

“ITSS is a liquid and balanced instrument offering excellent sectoral diversification with a significant allocation to IT companies. The launch of this new instrument marks an important step in developing a new architecture for the financial system across the entire region,” said ITS CEO Chingiz Kanapyanov.

Shares in the ITSS ETF provide access to a wide range of global halal stocks for experienced investors, professional managers, and those taking their first steps in the market. The fund offers a balanced basket of 30 Shariah-compliant shares from leading global companies such as Apple, ExxonMobil, Microsoft, Tesla, and others.

During the initial offering, investors purchased 500,000 shares of the fund at a price of $10, raising a total of $5 million. The ETF’s primary listing took place the previous day on the AIX exchange at the Astana International Financial Centre.

“This is a great opportunity. When you open an Islamic fund, it gives you a broader scope. In conventional, interest-based funds, only conventional investors participate. But in Islamic funds, everyone can invest – Muslims, non-Muslims, religious people, conservative people, and non-conservative people,” said Mufti Ibrahim Essa, an international Sharia expert who contributed to creating the ITS halal bloc.

According to Mufti Ibrahim Essa, the demand for the new instrument is expected to be strong and could attract investments from the Central Asian region and other Muslim-majority countries.

“This instrument opens up new opportunities for market diversification, attracting sustainable investments, and fostering trust among financial sector participants,” said Madina Tukulova, head of Islamic finance at the AIFC.