A comprehensive empirical and theoretical literature survey of Islamic bonds (sukuk)

In recent years, due to their ethical and Islamic principles, sukuk have received considerable attention from different kinds of investor, such as governments, corporations, institutional investors, fund managers. In this paper, in order to examine the past research and to provide some future directions on sukuk, we have reviewed and examined five different aspects of sukuk. The five main areas of sukuk, i.e. (i) the structural and fundamental differences between conventional and Islamic bonds; (ii) empirical research into sukuk; (iii) the choice between conventional bond and sukuk issuance; (iv) Shariah and legal issues of sukuk; and (v) the pricing of sukuk, are presented systematically. From the survey, it can be seen that most research has been conducted in the area of empirical studies of sukuk, while fundamental research into sukuk is largely ignored. Recommendations and directions for future research are presented at the end of the paper.