Systemic connectedness and shock transmission across FinTech, clean energy, Islamic and traditional assets

Purpose This study aims to investigate the dynamic connectedness and risk transmission among FinTech, clean energy, Islamic, and traditional financial assets, with particular emphasis on their behavior under varying market conditions and crisis periods. Design/methodology/approach This study uses conditional autoregressive value-at-risk, frequency connectedness, and wavelet local multiple correlation techniques to capture tail risk dynamics and time-frequency spillovers across asset classes. The analysis is conducted across multiple investment horizons, including daily, weekly, and monthly frequencies. Findings The results reveal a high level of interconnectedness across all asset classes, as indicated by a substantial total connectedness index. Short-term spillovers dominate over medium- and long-term dynamics, suggesting rapid transmission of shocks. The findings further indicate that connectedness patterns intensify during periods of economic and geopolitical stress, particularly during the COVID-19 pandemic and the Russia–Ukraine conflict. Islamic FinTech and Sukuk markets exhibit strong intraclass linkages and significant spillover effects with other financial assets. In addition, certain assets emerge as net risk transmitters, offering potential hedging and diversification benefits during crisis periods. Practical implications The findings provide valuable insights for investors and portfolio managers to optimize asset allocation and design effective hedging strategies. Policymakers can benefit from understanding the propagation of systemic risk to enhance financial stability frameworks, particularly in Islamic financial systems. Originality/value This study contributes to the literature by jointly examining FinTech, clean energy, and Islamic and traditional financial assets within a unified framework using advanced tail risk and frequency-domain methodologies. It offers novel insights into the evolving interconnectedness of Islamic and global financial markets.