Best Halal Mutual Funds in the US 2026: Amana + Shariah Funds Ranked by Cost + Return

The honest state of the US halal mutual fund market

If you search for “halal mutual funds” you’ll find a lot of lists padded with ETFs, robo-advisors, and foreign funds you can’t actually buy through a US brokerage. Strip all that out and the real US halal mutual fund universe is small: the Saturna Capital Amana family. The two you’ll actually choose between are Amana Growth (AMAGX) and Amana Income (AMANX), each with a lower-cost institutional share class (AMIGX and AMINX).

That scarcity matters because it changes the question. The real decision isn’t “which of twenty halal mutual funds is best?” — it’s “should I pay an active mutual-fund fee for the Amana track record, or buy a screened index ETF for a third of the cost?” This guide ranks the funds on a named criterion — expense ratio, screening rigor, and 10-year return — and then tells you where a mutual fund makes sense and where it doesn’t.

The ranking: halal mutual funds (plus the ETF alternatives) by cost, screen, and return

All figures below are issuer-verified as of late May 2026 (Saturna and SP Funds factsheets). The two genuine mutual funds are AMAGX and AMANX; SPUS and HLAL are included as the index ETF alternatives that screen the same investable universe, because the honest comparison runs across both structures.

The ranking puts AMAGX first because, among true mutual funds, it pairs the strongest long-run return with a defensible screen and the deepest track record. AMANX places second — it’s a sound income fund but carries the highest fee in the table at 1.01% while delivering a deliberately modest 0.55% yield. SPUS and HLAL aren’t ranked because they’re a different structure, but they set the cost bar every halal mutual fund has to clear.

Why AMAGX is the #1 halal mutual fund

Three things put Amana Growth on top. First, return: 17.56% annualized over 10 years is a genuinely strong number for a screened equity strategy that can’t touch conventional banks, insurers, or leveraged-balance-sheet companies. The Shariah screen tilts the portfolio toward quality growth and technology — the same names (Apple, Microsoft, Nvidia) that have driven the broad market — while excluding the financials that drag on yield but not on growth.

Second, track record: the Amana funds launched in 1986, making them the longest continuously running Islamic funds in the US. That’s nearly four decades of screened investing through multiple market cycles — far more live history than any halal ETF, which mostly date from 2019 onward. For a YMYL decision like where your retirement savings sit, a long real-world track record is a meaningful trust signal.

Third, screen integrity: Saturna applies a methodology aligned with AAOIFI Standard 21, excluding the standard prohibited business lines and dropping companies that breach the debt and interest-income ratios. It’s an active, human-reviewed screen rather than a purely mechanical index rule — which is part of what you pay the 0.86% for.

What most people miss: the fee gap quietly costs more than the screen

Here’s the part the “best halal funds” listicles skip. AMAGX’s 0.86% expense ratio sounds small. Against the 0.45% you’d pay for SPUS — which screens the same S&P 500 universe — it’s a 0.41-percentage-point drag, every single year, on your entire balance.

Run the math on a $100,000 position held 30 years, assuming both grow at an identical 8% before fees:

That’s a hypothetical with identical gross returns — it isolates the fee, nothing else. In reality AMAGX’s active management is betting it can beat the screened index by more than 0.41% a year. Over the last decade it arguably has. But the brutal truth of active investing is that past outperformance doesn’t reliably predict future outperformance, and the fee is certain while the outperformance is not. So the question to ask yourself is plain: do you believe AMAGX’s manager will keep beating SPUS by more than the fee gap? If yes, pay for AMAGX. If you’re unsure, the index ETF is the lower-regret choice.

The screen behind every halal fund: AAOIFI Standard 21

Whether you buy AMAGX, AMANX, SPUS, or HLAL, the same two-stage screen sits underneath. Understanding it tells you why these funds exclude what they exclude.

Stage 1 – business activity. A company is non-compliant if more than 5% of its revenue comes from conventional/interest-based finance and insurance, alcohol, tobacco, gambling, pork, adult entertainment, weapons, or conventional music/media. This is why no halal fund holds JPMorgan, Bank of America, or Berkshire Hathaway.

Stage 2 – financial ratios. Even an acceptable business fails if its balance sheet is too leveraged with interest. Under the strict AAOIFI Standard 21 thresholds:

• Interest-bearing debt must be 30% or less of market cap (S&P/MSCI/FTSE use roughly 33%).
• Cash plus interest-bearing securities must be 30% or less.
• Impermissible (interest) income must be 5% or less of total income.

A company that clears Stage 1 but carries 40% interest-bearing debt still fails. That’s the mechanical reason the screened S&P 500 (SPUS) holds a different, more concentrated set of names than the unscreened S&P 500 (VOO) — and why VOO, VTI, and the standard index funds fail the screen outright.

Purification: the step every halal fund investor forgets

Passing the screen isn’t the end of compliance. Even a fully compliant holding earns a tiny slice of incidental interest income — from operating cash, for instance — and that share of your profit must be purified: calculated and donated to charity. It is not tax-deductible, and it’s your responsibility, not the fund’s.

The good news is the issuers do the math for you. SP Funds publishes a quarterly purification calculator for SPUS, SPRE, and SPSK; Wahed publishes quarterly HLAL purification reports; and Saturna addresses purification for the Amana funds. Budget a small annual charitable amount per fund and keep the records — it’s usually a fraction of a percent of your balance, but it’s the difference between “screened” and “actually compliant.”

Where a halal mutual fund actually belongs: your IRA and 401(k)

A Roth IRA, Traditional IRA, and 401(k) are tax wrappers, not investments. The account is permissible; what matters is what you hold inside it. You can put AMAGX or AMANX in a Roth IRA tomorrow and the only halal question is the fund’s holdings — which the screen already answers.

The friction point is the employer 401(k). Most plans offer a fixed menu, and that menu rarely includes a halal fund — while the default target-date and bond options hold interest-bearing instruments that fail the screen. Two practical fixes:

1. Self-directed brokerage window. Many large 401(k) plans offer a brokerage window (sometimes called a “BrokerageLink” or “PCRA”) that lets you buy individual ETFs like SPUS or HLAL inside the plan. Check your plan documents — this is the cleanest route to a halal 401(k).
2. Route new money to an IRA. Contribute to the 401(k) up to the employer match (free money you don’t want to leave behind), then direct additional savings to a self-directed Roth or Traditional IRA where you control every holding — AMAGX, SPUS, a sukuk sleeve via SPSK, or allocated gold via GLDM.

AMANX: the income fund, and why its yield is low by design

Amana Income (AMANX) is the dividend-focused sibling — Shariah-compliant dividend-paying stocks, no bonds (because bond interest is riba). Its 30-day yield is just 0.55% (05/29/2026), which surprises people expecting an “income” fund to throw off 3–4%.

The low yield is structural, not a flaw. The highest-yielding corners of the market — banks, leveraged REITs, conventional insurers — are exactly what the screen excludes. What’s left is quality dividend payers that prioritize growth and modest payouts. AMANX’s 1.01% expense ratio is the steepest in the category, so if you want it, check whether you can access the institutional class AMINX at 0.76% instead. For most investors seeking halal income, a sukuk fund (SPSK, 4.41% 30-day SEC yield as of 03/31/2026) does more yield work than AMANX — the two solve different problems.

The decision lever

Boil it down to one question: do you want to pay for active management, or minimize cost?

• You believe in the Amana team and want the longest screened track record → buy AMAGX (or AMIGX if you qualify for the institutional class) and accept the 0.86% fee as the price of active growth.
• You’d rather keep fees low and own the screened index → skip the mutual funds and buy SPUS at 0.45% (the largest US halal ETF) or HLAL at 0.50% inside the same IRA.
• You want halal income → pair a sukuk sleeve (SPSK) with your equity rather than reaching for AMANX’s 0.55% yield at a 1.01% fee.

For the typical halal investor building a 30-year retirement balance, the lower-regret move is the index ETF — the certain fee saving compounds, and you avoid the bet that any active manager keeps beating the screen. AMAGX earns the #1 mutual-fund spot on merit, but the best halal investment for most people is the cheaper ETF that screens the same way.

Key takeaways

• The real US halal mutual fund universe is the Saturna Amana family: AMAGX (0.86%) and AMANX (1.01%), with lower-cost institutional classes AMIGX and AMINX.
• AMAGX is the best halal mutual fund — 17.56% annualized over 10 years, screened since 1986 — but its fee is roughly double the 0.45% SPUS ETF that screens the same S&P 500 universe.
• On $100,000 over 30 years at identical gross returns, the AMAGX-vs-SPUS fee gap costs about $98,000 — so active management only pays off if AMAGX beats the index by more than 0.41% a year.
• Every halal fund runs the AAOIFI Standard 21 two-stage screen (business activity plus debt/interest ratios) and requires you to purify incidental interest income via charity using the issuer’s quarterly calculator.
• IRAs and 401(k)s are permissible wrappers; hold AMAGX/SPUS inside them, and use a self-directed brokerage window when your 401(k) menu has no halal option.