How is Zakat calculated on stock investments in investment funds that are managed for long-term ownership, with variable cash liquidity, taking into account the difference between Zakat on Saudi stocks and international stocks, and is it treated as trade goods, ownership shares, or productive land?

The zakat on shares is calculated based on the nature of the company's activity and the shareholder's intention:

1. For non-commercial companies (hotels, transport, aviation) or shares not purchased with the intention of trading: There is no zakat on the principal of the shares themselves, but only on their profits, if they reach the nisab (minimum threshold) and a hawl (full lunar year) passes over them (2.5%). 2. For shares intended for their dividends (yield): If the company undertakes to pay zakat on its shares: The shareholder is not obliged to pay zakat again. If the company does not undertake this, but its Shariah board specifies a zakat percentage: The shareholder must pay this percentage by multiplying the number of shares by the stated percentage. 3. For purely commercial companies (import, raw materials): Zakat is obligatory on the principal of the shares and their profits based on their market value (2.5%). If there is no market value, experts should appraise them. This also applies to shares in industrial companies if the shareholder intends to trade them. 4. For companies that are both commercial and industrial (transformative): Zakat is obligatory on their shares after deducting the value of the company-owned buildings and machinery.

Shares are zakatable based on their market value, not their book value. Some scholars differentiate between a trading merchant (tajir mudir) who pays zakat on his trade goods every hawl, and a stockpiling merchant (tajir muhtakir) who pays zakat on them for one year when he sells them (the majority of scholars consider their ruling to be the same).