Islamic stock market versus conventional: Are Islamic investing a ‘Safe Haven’ for investors? A systematic literature review

Focusing on the comparison of Islamic Stock Market (ISM) and Conventional counterparts, this paper tries to answer to the following questions: “Are Islamic indexes a ‘Safe Haven’ for investors?”, and “Does Islamic equity investment provide diversification benefits to Conventional investors?”. Performing a systematic literature review on a sample of articles published in academic journals from 2009 to 2019, we show a lack of consensus on the answers. Until the present day, most contributions focused on contraposition of the two systems, trying to verify the presence of decoupling, contagion, interdependence or relationship between these two realities. The taxonomy provided suggests a need to change of mindset which could supply several implications in financial decisions, including asset allocation strategies of individual and institutional investors as well as policymakers' decisions, in order to contribute developing a more resilient, inclusive and sustainable financial system. Finding results can be used to define a better financial system (in the stock market component), which is both more resilient to unexpected financial shocks and support the inception of a sustainable financial system.