The impact of exchange rate on the number of initial supply of companies listed in Tehran stock exchange

Abstract EN

Currency and stock price indexes are two basic concepts in the financial domain.

These two concepts play a key role in global business.

Identifying relationship between the two allows the investors to minimize their investment risks.

Stock Exchange as one of the main pillars of the capital market while equipping and dropping stagnant savings in the country and pushing them towards production is able to accelerate the movement towards economic growth and development.

Also, the exchange rate is one of the factors affecting the stock index and its values always fluctuating in different ranges.

Given the differences in investment infrastructure and economic conditions of the countries, the effect of the exchange rate and its fluctuations on the stock price index in different countries may be different.

As the exchange rate fluctuates, many sectors of the economy will be affected.

One of these sectors is the capital market which its importance is in attracting private savings, investment, and economic growth.

In this study, the effect of exchange rate changes on the number of initial supply in different industries during 2002-2016 is analyzed.

The data collected for the sample member firms were analyzed by Eviews software using mathematical models.

The results show that in all the industries studied, the exchange rate is directly related to the number of initial supply in the same industry.

However, this is not true with the investment fund industry, the investment industry, the insurance industry, and the pension fund.

Key words: Initial Supply, Exchange Rate, Tehran Stock Exchange.