Three Investments Undertaken by the Prophet Muhammad, a Possible Example

Investment activity has in fact developed since the time of the Prophet Muhammad (SAW). The Prophet is not only known as a spiritual figure and a model for Muslims, but also as a successful figure in the business world.

So, what did investment strategies look like according to the Prophet Muhammad (SAW)?

According to The Rasulullah Way of Business (2021) study, Muhammad had trust-based capital and was able to attract investors because of his honesty and trustworthiness.

Subsequently, after running ventures funded by the money of sponsors, the Prophet Muhammad implemented profit-sharing on the profits of his enterprises. Thereafter, he invested with the aim of achieving a passive income.

One activity he pursued was livestock farming. He continued this skill from childhood into adulthood by owning dozens of camels. He is also known to have had other animals, including horses, donkeys, cattle, and sheep.

Not only livestock, he also invested in land and property. Musaffa’s report notes land rental was conducted with Jewish partners under a profit-sharing arrangement.

Prophet Muhammad also leased a date palm grove and land in Khaybar from Jewish owners. They could live on the land and manage it, sharing the profits. Finally, the profit-sharing concept is known as mudharabah.

One thing to remember about the Prophet Muhammad’s investment activity is the aspect of charity. Islam teaches that others have rights in a person’s wealth, and by helping others one can gain extraordinary rewards.

The Prophet Muhammad did not hoard his wealth. He was known for frequent charity, whether in money, clothing or food.

Ultimately, if you want to follow the Prophet Muhammad in investing, choose property, land and livestock. And remember to give in charity as well.