The aim of this research is to prove and analyze the effects of knowledgeand corporate governance to sharia stocks. Moreover, the background of theresearch is based on the different philosophy between mainstream corporategovernance and Islamic corporate governance. The methodology of this researchapplies to circular causation approach which the variables are endogeneity andreciprocal effects. The results of the research are; firstly, it indicates that there aresignificant positive effects of knowledge to sharia stocks, sharia stocks to knowledge,knowledge to corporate governance, and corporate governance to knowledge.Secondly, there are significant negative effects of corporate governance to shariastocks and sharia stocks to corporate governance. The reciprocal positif effects arethe form of interaction which complements among variables which contain manfaahand mashlaha, whereas the reciprocal negative effects are the form of interactionamong variables that contain dharar.