AGG
iShares Core U.S. Bond ETF
Is AGG Halal?
Fixed-income bond fund — the official accounts show interest-bearing securities as the core portfolio and interest income as the return source.
What You Should Know
AGG's February 2026 annual financial statements report roughly USD 144.9 billion of bond and money-market investments and USD 5.18 billion of investment income, with a 3.95% net-investment-income ratio. Conventional bond coupons are riba under the major Sharia standards.
⚠️ Concerns
- •Interest (riba) is the core return mechanism
- •Government and corporate debt
- •Completely impermissible
Current quantitative Sharia screen
Based on Annual financial statements figures for the period ended 2026-02-28; calculated 2026-07-14.
0 / 147,626.947
144,915.663 / 147,626.947
2,711.795 / 147,626.947
5,182.951 / 5,182.951
- Financial
- Fails
- Overall
- Fails
Interest-bearing securities are 98.16% of assets and disclosed investment income is treated as 100.00% non-compliant; the fund's conventional bond mandate independently fails.
- Financial
- Fails
- Overall
- Fails
Liquidity/assets is 98.17%, above the examined MSCI limit, and the fund's conventional fixed-income mandate independently fails.
- Financial
- Fails
- Overall
- Fails
Liquidity/assets is 98.17%, above the examined Malaysia limit; conventional bond activity also fails the qualitative screen.
- Financial
- Not calculated
- Overall
- Fails
Market-cap denominators are not designed for a bond fund and cannot cure the conventional fixed-income failure.
Business-activity disclosure
AGG's stated objective is broad exposure to U.S. investment-grade bonds, mortgage-backed securities and other fixed-income instruments. Interest-bearing debt securities are the core asset and return mechanism.
Limitation: The report does not distinguish a Sharia-compliant sukuk sleeve; the portfolio is presented as conventional fixed income and money-market instruments.
Purification
The fund fails at the core business-activity level because conventional interest-bearing bonds are its investment mandate; ZakatInvest does not prescribe a donation percentage for an impermissible fund.
Inputs, assumptions and primary sources
- Amounts are USD millions from iShares' February 28, 2026 annual financial statements.
- Total assets are USD 147,626.947 million; investments comprise USD 139,468.923 million unaffiliated securities and USD 5,446.229 million affiliated money-market funds, with USD 0.511 million cash.
- Receivables total approximately USD 2,711.284 million across investments sold, securities lending, TBA sales commitments, capital shares sold, dividends and interest.
- The fund reports USD 5,182.951 million of investment income, including USD 5,037.648 million of unaffiliated interest; the full income stream is conservatively treated as non-compliant because the fund's core holdings are conventional bonds and money-market instruments.
- ETF look-through ratios are not an official FTSE, MSCI or Malaysia classification.
This is a reproducible financial screen, not a fatwa. A failed total-assets screen can coexist with a pass under a market-cap methodology. ZakatInvest keeps the qualitative assessment separate so numerical thresholds do not erase material context.
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