Purpose This paper aims to examine whether the Ramadan effect in stock markets is a global seasonal anomaly or a context-dependent behavioural phenomenon. It synthesises how Ramadan shapes return, volatility, liquidity, herding and sentiment and how these patterns differ between Islamic and conventional indices across cultural and institutional settings. Design/methodology/approach The authors conduct a systematic literature review (SLR) of equity-market studies on the Ramadan effect indexed in Scopus and Web of Science from 2005 to 2024. Following Tranfield et al. (2003) and PRISMA 2020, the authors apply predefined inclusion and exclusion criteria and combine bibliometric mapping with thematic analysis on 55 papers. Findings The review shows that Ramadan systematically shifts investor sentiment, attention and speculative intensity, yet market outcomes are heterogeneous. Many Muslim-majority exchanges exhibit higher returns and lower volatility during Ramadan, whereas others show weak or null effects. Islamic indices display more consistent Ramadan anomalies than conventional indices, reflecting ethical screening, lower leverage and more cohesive investor bases; the strength of the effect depends on cultural cohesion, retail participation and market microstructure. Practical implications The findings inform regulators, exchanges and portfolio managers on how Ramadan-linked behavioural cycles can guide disclosure timing, market operations and allocation strategies. Originality/value To the best of the authors’ knowledge, this is the first global SLR to integrate behavioural, cultural and institutional perspectives to explain cross-country heterogeneity in the Ramadan effect. The study clarifies when Ramadan operates as a priced behavioural cycle rather than a universal anomaly and outlines a future research agenda.
Wahyono et al. (2026) studied this question.