Global index provider FTSE Group and the Stock Exchange of Thailand (SET) are to expand the FTSE SET Index Series with the addition of the FTSE SET Shariah Index.

The index aims to open up the Thai capital market to a new investor class, allowing both domestic and international investors to invest according to Islamic principles. The new index is suitable for benchmarking and can be used for a wide range of Islamic products including ETFs, funds and other index-linked products.

Using the FTSE SET All-Share Index as the base universe, the index is screened by Yasaar Limited a global leading Shariah consultancy. Unlike other methodologies, the FTSE SET Shariah Index uses asset-based debt screening, the same that is used for the FTSE Shariah Global Equity Index Series. The resulting methodology is less speculative and more in keeping with Shariah principles ensuring companies do not pass the criteria due to market cap fluctuation.

Patareeya Benjapolchai, president of SET, said: "The launch of this index is a positive step forward into a growing Shariah-related market. This new index will serve both domestic and international investors looking to invest in a transparent and Shariah-compliant manner, as well as help issuers create structured investment products tailored to the global Islamic market."