Cautious optimism weighs on 2026 Shariah investment landscape

Within the first weeks of the new year, it is quickly becoming clear that geopolitics will take an even more prominent role in 2026 – where a potential Iran flashpoint and uneasy US-Europe posturing over Greenland are already driving up valuations of Shariah commodity assets like gold and silver.

Chart 1: One-year gold price trend (US$ per ounce)

Source: World Gold Council, pricing as at the 23^rd January 2026

Chart 2: One-year silver price trend (US$ per ounce)

Source: TradingView, pricing as at the 23^rd January 2026

Looking at the bigger picture, Shariah asset manager Arcapita also expressed concern over the possibility of re-inflationary pressures. “We observe a trend in private wealth and certain institutional investors towards shorter duration investment horizons … locking up capital for 10 years or more is currently less appealing”.

Other Islamic asset classes like real estate are turning more localized as investors seek to mitigate the impact of global trade – stung by the unilateral tariff tensions unleashed by the Trump administration since April 2025 – by focusing on strategically-located logistics and warehousing assets.

This confluence of caution is resulting in many Shariah investors “staying liquid” for fast redeployments and more critically, “keeping assets within safe harbors", commented a prominent asset manager – adding that investors are further reminded of the recent unhindered bombing of a Qatar location by Israeli forces, with jitters about how easily calm waters could be stirred up in the GCC region.

So, while it will be “business as usual” for the most part, Shariah investors are already identifying and acting on what they perceive will need to be fresh anchor points should a “flight to safety” be triggered – as even the US dollar may no longer be a safe enough haven, given how the American currency value has already dipped in recent weeks.

Chart 3: US dollar index

Source: MarketWatch, pricing as at the 23^rd January 2026

Perhaps the most attractive prospect for 2026 could be the advent of blockchain and crypto assets into mainstream offerings – with initiatives like the Guiding and Establishing National Innovation for US Stablecoins Act. Similar regulations issued by the Central Bank of Bahrain also provide Shariah clarity.

The latter was highlighted by Fitch's Global Head of Islamic Finance Bashar Al-Natoor, who noted the AAOIFI standard reference can “bring clarity and confidence for stablecoin investors and issuers. Its alignment with international standards could attract institutional interest and cross-border partnerships".

Increased regulatory support for crypto assets was seen in more jurisdictions – with the usual plays in UAE and Saudi Arabia, plus changes afoot in Indonesia, Oman and Qatar. Overall, this development could finally see more Shariah crypto funds offerings in 2026 – emulating pioneering Malaysia – once crypto valuations start rising, after a prolonged correction since September 2025.

Touching on the Islamic private market space, UK-based Mnaara said investors and managers remain intensely focused on liquidity – as traditional exits slowed, the secondary market surged.

“Secondaries are no longer a niche; they are becoming a strategic allocation. We expect 2026 to bring further normalization, with a larger share of exits coming from sponsor-to-sponsor transactions, trade sales and a gradually reopening IPO window.”

While tech remains a major draw for Muslim-focused investments, big themes like AI are moderating as caution spreads over what futuristic promises can actually be delivered – though significant capital continues to pour into the services sector for start-ups and ventures addressing key pain points like financial access, healthcare, transport and utilities.

Investcorp is avoiding the crowded space of data center investments, Vice-President and Chief Investment Officer Rishi Kapoor said at the sidelines of the 2026 World Economic Forum in Davos, Switzerland.

He reportedly said that returns for this sector had gotten compressed – and that the firm is instead focusing on investments in domestic professional, commercial and healthcare services, IT services as well as transportation.