Wealthsimple Halal Portfolio Review 2024: Is It Worth It?
Wealthsimple Halal Review Rating: 4.0/5
Different portfolios are designed for investors with different investment objectives and values.
This informed the creation of the Wealthsimple Halal portfolio to meet the needs of investors looking to invest according to Islamic standards.
But is this the perfect portfolio for you? What are the advantages and disadvantages of the portfolio?
In this Wealthsimple Halal review, I explain what the portfolio entails to help you determine if it is suitable for you.
I also compare the WS Halal portfolio with other portfolios to help you make an informed decision.
Overview of Wealthsimple
A better understanding of the Halal Portfolio must start with a basic understanding of Wealthsimple.
Wealthsimple is a household name in the Canadian industry of online investment management.
Whether you’re a beginner or a seasoned Canadian investor, chances are you have heard about Wealthsimple when looking for the best robo-advisor in Canada or a self-directed trading platform.
Wealthsimple is also present in the Canadian crypto industry, fractional shares trading, money transfers and tax filing.
Founded in 2014, Wealthsimple is a one-stop-shop shop for finance and investment solutions.
This review focuses on Wealthsimple Halal which is one of the investment portfolios Wealthsimple offers.
Is Wealthsimple Legit and Safe?
There’s no gainsaying the fact that Wealthsimple is legit and safe. As of the time of writing this Wealthsimple Halal review, Wealthsimple has over $10 billion in assets under management.
Trusted by over 1 million Canadians, Wealthsimple is affiliated with ShareOwner Investments Inc. (ShareOwner). As a result, your deposits on Wealthsimple are covered up to $1 million by the Canadian Investor Protection Fund (CIPF).
In addition, Wealthsimple covers your account with standard insolvency.
Your information on Wealthsimple is protected with state-of-the-art encryption and two-factor authentication (2FA) protection.
Overall, you have nothing to fear about the legitimacy and safety of Wealthsimple.
What is Wealthsimple Halal?
| Inception date | August 23rd, 2017 |
| Portfolio manager | Mackenzie Financial Corporation |
| Asset allocation | 40% equity, 15% gold and 45% non-interest-bearing cash |
| Portfolios | Growth, balanced, conservative |
| Eligible accounts | RRSP, RRIF, LIRA, RESP, TFSA, non-registered accounts |
| Management fee | 0.4% to 0.50% |
| MER | 0.18% for gold ETF and 0.5% for equity ETF |
| Dividend distribution | Quarterly |
Wealthsimple Halal is an investment account or portfolio that is designed to comply with Islamic investment principles based on the authorization and regulation of the Rating Intelligence Partners’ team of Islamic researchers.
The portfolio is the first of its kind in Canada as it was launched in 2017 by Wealthsimple.
Based on Islamic investing principles, several traditional investment products are not compliant. This includes investment that earns profit from debt such as bonds.
In addition, earning profit from certain investments/activities is also prohibited. This includes gambling, alcohol, tobacco, weapons, and pork among others.
As a result, WS Halal seeks to target Shariah-compliant indexes such as the Dow Jones Islamic Market Developed Markets Quality and Low Volatility Index.
Initially, the portfolio invested in 100% equity but was adjusted to include a mixture of equity, gold and non-interest-bearing cash. This makes it a diversified portfolio for Islamic-based investing.
Wealthsimple Halal Investment Objective
The objective of WS Halal is to track the performance of Shariah-compliant indexes such as the Dow Jones Islamic Market Developed Markets Quality and Low Volatility Index.
To this end, the portfolio invests in Shariah-compliant security across developed markets across the world. These securities are:
- Equity
- Gold
- Non-interest bearing cash
Wealthsimple Halal Assets Allocations
As mentioned previously, the WS Halal Portfolio targets Shariah-compliant securities in developed markets across the world.
The following is the current assets allocation of the WS Halal portfolio as of the time of writing this review
| Asset | Allocation |
| Wealthsimple Shariah World Equity Index ETF (WSHR) | 40% |
| Gold | 15% |
| Non-interest bearing cash | 45% |
Looking at the above table, you can see that the WS Halal portfolio invests more in non-interest-bearing cash followed by equities.
Wealthsimple Halal Portfolios
| Portfolio | Risk Level |
| Halal Growth | Medium-to-high |
| Halal Balanced | Medium-to-high |
| Halal Conservative | Low-to-medium |
WS Halal currently has three portfolios with different allocations and risk levels. The following is a brief overview of each of them.
Let’s take a view at the three portfolios of WS Halal and their
- Halal Growth Portfolio: This portfolio has a combination of Shariah-compliant Wealthsimple World Equity Index ETF and gold. The portfolio is tailored to investors with medium-to-high risk profiles.
- Halal Balanced Portfolio: This portfolio has a combination of Shariah-compliant Wealthsimple World Equity Index ETF, gold and non-interest-bearing cash. The portfolio is also tailored to investors with medium-to-high risk profiles.
- Halal Conservative Portfolio: This portfolio also has a combination of Shariah-compliant Wealthsimple World Equity Index ETF, gold and non-interest-bearing cash. The portfolio is tailored to investors with low-medium risk profiles.
You might also be interested in our Justwealth RESP Review
Wealthsimple Halal Portfolio Performance
As expected, the WS Halal portfolios perform differently since their inception. Below are their cumulative returns from inception (May 14, 2021) to December 30, 2023.
| Portfolio | Performance |
| Halal Growth | 14.6% (net of fees) |
| Halal Balanced | 12.7% (net of fees) |
| Halal Conservative | 9.2% (net of fees) |
Frankly speaking, WS Halal portfolios’ returns are impressive compared to their various allocations. But the returns are relatively low compared to the returns of other portfolios.
The above table only confirms the fact that the higher the investment risk, the higher the returns. Depending on your risk profile, you can’t make the wrong choice with any of the portfolios.
Wealthsimple Halal Sector Allocations
The following are the current industry/sector allocations of WS Halal as January 5, 2024.
| Sector | Allocation |
| Consumer Staples | 13.9% |
| Industrials | 13.8% |
| Health Care | 12.6% |
| Materials | 12.4% |
| Consumer | 11.2% |
| Information Technology | 10.7% |
| Communication Services | 7.5% |
| Real Estate | 7.3% |
| Utilities | 4.2% |
| Energy | 3.8% |
| Financials | 2.7% |
Source: Wealthsimple.com
As you can see, WS Halal sector allocations are weighted toward consumer staples and industrial sectors.
Wealthsimple Halal Market Capitalization
As discussed above, WS Halal invests in Shariah-compliant security across developed markets across the world.
The following are the top countries the portfolio invests in and their allocations as of January 5, 2024:
| Country | Allocation |
| United States | 33.60% |
| Japan | 17.20% |
| Switzerland | 8.3% |
| Britain | 7.2% |
| Canada | 4.7% |
| France | 3.9% |
| Australia | 3.8% |
| Hong Kong | 3.4% |
| Sweden | 3.4% |
| Netherlands | 3.3% |
Source: Wealthsimple.com
As you can see, the portfolio is weighted more towards the US with only 4.7% allocation to Canada.
Wealthsimple Halal Stocks List
Wealthsimple Halal comprises 167 stocks as of January 5, 2022. Note that the stocks are weighted based on risk levels, not market caps.
That being said, the following table presents a partial highlight of the Wealthsimple Halal stocks list:
| Nestle SA | Walmart Inc | Barry Callebaut AG |
| Johnson & Johnson | Canadian National Railway Co | CLP Holdings Ltd |
| Hershey Co/The | Hong Kong & China Gas Co Ltd | Coca-Cola Co/The |
| Alphabet Inc | Equinix Inc | Cooper Cos Inc/The |
| adidas AG | Halma PLC | Visa Inc |
| Mastercard Inc | Microsoft Corp | Prologis Inc |
| Target Corp | Nissan Chemical Corp | ZOZO Inc |
| S&P Global Inc | Apple Inc | Best Buy Co Inc |
| Garmin Ltd | Exxon Mobil Corp | Pinterest Inc |
| Pfizer Inc | Canon Inc | Shin-Etsu Chemical Co Ltd |
To learn more about other stocks under the Wealthsimple halal portfolio, click here. [Note: The the stock list page is now available only to Wealthsimple users].
In what follows, we’re going to look at the top stocks that Wealthsimple Halal invests in.
Wealthsimple Halal Top Holdings
The following are the top 10 Shariah-compliant companies that WS Halal invests in as January 5, 2024.
| Company | Allocation |
| Nestle SA | 1.00% |
| Hong Kong & China Gas Co Ltd | 1.00% |
| CLP Holdings Ltd | 0.90% |
| Givaudan SA | 0.90% |
| Beiersdorf AG | 0.90% |
| Waste Connections Inc | 0.90% |
| McDonald’s Holdings Co Japan Ltd | 0.80% |
| Wolters Kluwer NV | 0.80% |
| Singapore Telecommunications Ltd | 0.80% |
| SGS SA | 0.80% |
Source: Wealthsimple.com
Wealthsimple Halal Portfolio Fees
The WS Halal portfolio has the following fee structure:
- Management fee: 0.50% for your first $100k deposit and 0.4% after that
- MER: 0.18% for gold ETF and 0.5% for equity ETF
While the WS Halal MER is relatively low, the management fee is relatively higher compared to the fees of other portfolios/brokerages
Pros and Cons of Wealthsimple Halal Portfolio
Below is a highlight of the pros and cons of the WS Halal portfolio you should consider before investing.
Pros
- Diversified portfolio
- Low MER
- Automated portfolio rebalancing
- Automated deposits
- Dividend reinvesting
- Passive investing
Cons
- Low returns compared to other portfolios
- High management fee
My Wealthsimple Halal Review Rating
I rate WS Halal 4.0 out of 5-star based on comparative analysis and the total rating of the following features:
Wealthsimple Halal Review Rating Methodology
Overall Rating
This makes my WS Halal review positive and recommendable to Canadians looking for Islamic-based investing portfolios.
Is the Wealthsimple Halal Investment Portfolio Perfect For You?
With the foregoing WS Halal review, it’s now easy to determine whether the portfolio is perfect for you or not.
If you’re a devoted Muslim and are looking for a portfolio that complies with Islamic principles, you can’t actually make the wrong choice with the Halal portfolio.
However, the portfolio may also be ideal for you even if you’re not a Muslim but your values are weighted towards the objective and allocations of the Halal portfolio.
If this portfolio is perfect for you, kindly visit the portfolio sign-up page to get started.
However, you may want to consider WS Halal alternatives if you’re looking for high returns on your investment without regard to how and where your money is invested.
In the following section, I discuss some of the alternatives you should consider when looking for high returns on your investment.
Wealthsimple Halal Alternatives
Considering the relatively low performance of WS Halal portfolios, you may want to consider other options especially if you’re not comfortable with the Halal portfolio objective.
The following are two top alternatives of the portfolio you should consider.
1. Wealthsimple Socially Responsible Investing (WSR)
Like WS Halal investing, Wealthsimple Socially Investing (WSR) is also a special portfolio that Invests in companies that comply with certain standards.
In this case, the WSR portfolio invests in companies that comply with social and environmental principles.
However, both WS Halal and WSR portfolios invest in diversified low-fee exchange-traded funds (ETFs) across developed markets.
But while the WS Halal portfolio allocates funds in equity, gold and non-interest-bearing cash, the WSR portfolio invests completely on the stock market.
As of the time of writing this review, the WSR portfolio has the following allocations:
| Asset | Allocation |
| Bonds & Gold | 70% |
| Wealthsimple Developed Markets ex North America Socially Responsible Index ETF (WSRD) | 15% |
| Wealthsimple Developed Markets ex North America Socially Responsible Index ETF (WSRD) | 15% |
Due to these allocations, the WSR portfolios had relatively higher returns since inception (as of December 30, 2023), compares to the WS Halal returns as you can see below:
| Portfolio | Wealthsimple Halal | Wealthsimple Socially Responsible Investing |
| Growth portfolio | 11.7% | 53.6% |
| Balanced portfolio | 10.4% | 34.6% |
| Conservative portfolio | 2.9% | 15.6% |
The choice is yours to make. But you can’t make the wrong choice with any of the two portfolios depending on your values and investment objective.
2. Individual Stocks
Are you a seasoned investor? Can you pick the perfect stock for your risk tolerance and objective and rebalance it regularly?
If yes is your answer, investing in individual Shariah-compliant stocks should be your other option.
Instead of having your funds in an all-in-one basket of funds (ETF) as WS Halal, buying individual stock will give you maximum reward.
However, this comes with a higher risk level and costs as you will need to buy the complete stock and rebalance it regularly.
Learn about the Best All-in-One ETFs in Canada
Bottom Line on Wealthsimple Halal Review
The bottom line is that WS Halal portfolio is perfect for investors looking for a strictly Shariah-compliant portfolio.
But if you’re looking for more rewards on your investment, you should consider the Wealthsimple Socially Responsible Investing portfolio which also invests according to certain principles.
Preferably, consider investing in individual stocks if you’re a seasoned investor with a high-risk tolerance.
Regardless of which portfolio you’re going with, consider your investment objective and risk tolerance before hitting the ball rolling.
Kindly let me know in the comment below the portfolio you’re going with.
All the best!
FAQs on Wealthsimple Shariah World Equity index ETF Review
Is Wealthsimple halal?
Wealthsimple is halal because it offers an Islamic-compliant investment portfolio that makes it possible to invest according to Islamic principles.
Is Wealthsimple halal actually halal?
Wealthsimple halal is actually halal as per the authorization of the Rating Intelligence Partners’ team of Islamic researchers. The allocations and investment strategies of Wealthsimple halal complies with Islamic law.
Is Wealthsimple halal good?
If you are after an Islamic-compliant portfolio without regards to high returns on your investment, Wealthsimple halal may be ideal for you.
What if I have more questions on Wealthsimple halal?
Drop them in the comment section or reach out to Wealthsimple through their contact page.
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Wealthsimple Halal Review
Summary
Wealthsimple Halal is perfect for investors looking to build a strictly Shariah-compliant portfolio.
