Sharif Digital Repository

The impact of ownership concentration on competitive conditions and profitability of industries has been studied and analyzed for decades. By using the Herfindahl-Hirschman concentration index, a range for the level of concentration in the industry has been determined, and some countries implement anti-trust laws based on this range. The new literature that has been discussed recently is the concentration of the market directly and through the common ownership of corporations by large shareholders. In the sense that two or more apparently independent companies may have a common owner who practically regulates their behavior as a company. The structure of ownership in Iran is complex and... 

Pyramidal and network ownership structures that provide ultimate owners with more control over companies are common in the Iranian stock market. Given the multi-layered shareholding networks and the significant changes that have occurred in the ownership structure of large Iranian companies in the last two decades, the purpose of this study is to investigate the relationship between ownership structure and performance of companies. To achieve this purpose, ownership structure is examined using four measures; cash flow right of the largest shareholder, the wedge between control right and cash flow right of the largest shareholder, difference in cash flow rights of the largest two... 

The rank effect means that investors are more likely to sell the best or worst positions in their portfolio in terms of returns. According to this effect, the probability of selling a stock in a prominent position (first or last) is higher than other stocks in the portfolio. Apart from being a behavioral bias, the rank effect is that the decision to sell a stock depends on how it is compared and ranked with the rest of the portfolio. In this study, we examine the rank effect on the trading behavior of Iranian mutual funds for the period 1390-1399 and find that it is significant. First in a statistical and univariate form, and then by including other variables such as firm-specific... 

In recent years, some listed companies have re-evaluated their assets, an event that has generally received market attention; In fact, the market seems to be reacting very positively to an accounting phenomenon. In this study, we seek to investigate the market reaction to the revaluation of listed companies in Iran. To do this, we first estimate the market reaction to the news of the revaluation of assets. We then examine the possible reasons for the market reaction to the revaluation. Asset revaluation can improve the firm's access to finance by improving some financial ratios; On the other hand, the increase in capital from the revaluation of firms is accompanied by the issuance of bonus... 

Privatization in Iran was primarily driven by the 2004 amendment to the Article 44 of the Iranian Constitution. Improving firms' efficiency is cited as the key goal of the privatization program. The two prominent characteristics of the privatization program in Iran are complex ownership structure and transferring ownership from the government to government-affiliated institutions and organizations. For these reasons, the consequences of privatization in Iran may differ from those of other countries. Therefore, this study explores the relation between privatization and firm performance, as measured by firm efficiency, labor efficiency, investment, and the number of employees. As a significant... 

Price manipulation can lead to lack of transparency and impair proper functioning of financial markets. On the Tehran Stock Exchange, there is ample anecdotal evidence that some blockholders try to manipulate the price before the block transactions to change the share price significantly. In this paper, we provide empirical evidence that in intergroup block trades, blockholders tend to buy shares before the trade date or engage in round-trip transactions to increase the block shares price. No such evidence is found in intragroup transactions and other explanations such as market reaction to a change in corporate ownership seem more plausible than price manipulation. In addition to the... 

As an initial step in understanding the issue of disputed spoofing orders in the Tehran Stock Exchange (TSE), this paper empirically analyzes the limit order book data of the market from 2010 to 2024. The findings demonstrate—consistent with the existing literature—that the pre-opening phase of the TSE contains valuable informational content. Notably, the study identifies evidence of learning over time during the pre-opening phase, accompanied by a significant increase in informational content as the market approaches its opening. These results align with both theoretical and empirical studies in this domai. The analysis further reveals that factors such as company size play a crucial role... 

This study examines the quality of Corporate Social Responsibility (CSR) disclosure among publicly listed companies in Iran and identifies the factors that influene it. The research sample consists of 546 companies listed on the Tehran Stock Exchange and Iran Fara Bourse, covering the period from February 2023 to January 2024. Data were extracted from audited financial statements and the annual reports of the companies' boards of directors. In the first part of the study, a CSR disclosure quality index comprising 39 factors was developed. The annual reports of the companies were then analyzed to calculate a disclosure score for each company. The average CSR disclosure quality score was... 

Objective: Business groups that create pyramidal ownership structures are a common form of corporate ownership in developing countries such as India, Chile, and Iran. These groups, along with the benefits they create, separate voting rights from cash flow rights; As a result, the ultimate owner will control them while having a small share of the cash flows of the companies in the lower layers of the group. This phenomenon provides tunneling motivation for controlling owners; incentivizing them to transfer resources and assets of their subsidiary companies (transferring resources from companies with less cash flow rights to companies with more cash flow rights) to gain private benefits at the... 

This research examines the effect of the relationship between firms and private banks on the behavior and performance of firms. For this purpose, the data of the relationship of non-financial listed firms with private banks, as well as the available data from the characteristics of these firms, have been used. The dataset of this research is an unbalanced panel of firms between 2004 and 2014, in which the characteristics of the firm and the connection or non-connection of the firm with private banks are specified in each year. In the following, with the help of these data and the method of propensity score matching and difference in difference, the main question of the research has been... 

In the present study, we examine the behavior of institutional investors in response to fluctuations in the Iranian stock market. Specifically, we examine the question of whether, in significant market fluctuations, institutional investors engage in grievous trading behavior and follow market trends or move in the opposite direction of the market and provide liquidity. For this purpose, we examine the relationship between the percentage of ownership of institutional shareholders and the stock price return and the trading volume of companies in severe market fluctuations. Also, we obtain the relationship between the percentage of ownership of institutional shareholders and stock price returns... 

Ownership concentration and the separation of voting rights from cash flow rights are common in countries with weak legal protections for minority shareholders. These characteristics shift the agency problem from conflict of interests between managers and shareholders to conflict of interests between majority and minority shareholders. In such ownership structures, majority shareholders receive dividends based on their cash flow rights but exert control over the company according to their voting rights. Consequently, they have both the motivation and the ability to withhold profit distribution among minority shareholders and prioritize their own interests. Iran, as a country characterized by... 

This paper examines the effect of the initial public offering (IPO) of banks in the Tehran Stock Exchange on their lending practices to firms. To this end, panel data from the financial statements of 93 listed firms, along with a database of loan balances of listed companies in the Tehran Stock Exchange, categorized by their respective banks, between 1386 and 1397, were utilized. The main question of this paper is whether the IPO of banks in the stock market affects their decision-making in granting loans and applying essential filters in selecting firms. To answer this question, the ordered logit method was employed. The results of the research show that publicly listed banks are more... 

The aim of this paper is to investigate the effects of Iranian Chief Executive Managers and board of directors on the outcomes of their firms. First, by exploiting the information about changes in the combination of managers in 488 firms in Tehran Stock Exchange and Iran Fara Bourse, this study seeks to give an insight about managers’ labor market in Iran. Then, after combining these data with the obtained information from the firms’ financial statements, we run a set of regressions to identify whether managers have significant effect on the firms’ behaviors and performance. The results of this investigation show that a significant portion of changes in firms’ outcomes can be explained by... 

In this study, we investigate the phenomenon of price manipulation in rights offering transactions using the data of share capital increase, price and ownership of firms in Iranian capital market. We find that blockholders reduce the share price by selling stocks during the rights trading period and then buying the rights at lower prices. We further find that the shareholders who bought the highest amount of the rights tend to sell a higher percentage of shares during the trading period, and the cumulative abnormal return is inversely related to the rate of sale of these blockholders. We also observe that the probability of price manipulation is higher for stocks with lower liquidity and... 

The average annual turnover of Iranian mutual funds is 330 percent during the years 2011 to 2017. Such a high-volume trading imposes substantial transaction costs on the funds and their investors. Transaction costs comprise four different types of costs: In addition to taxes and commissions, there are other transaction costs originating from bid-ask spread and price impact, which need more complicated procedures to assess. By using high-frequency data and the information in the fund’s seasonal financial statements, the transaction costs of fifteen Iranian mutual funds are estimated. These funds spent 11 percent of their value on the trading costs per anum. Furthermore, the relation between... 

For a Variety of reasons, financial economists tend to view individuals and institutions differently. In particular, while institutions are viewed as informed investors, individuals are believed to have psychological biases and are often thought of as the proverbial noise traders. One of the questions of interest to researchers in finance is how the behavior of different investor clienteles or their interaction in the market affects returns. In this paper we focus on the interaction between individual investors and stock returns in Iran capital market. Specifically, first we examine the extent to which intense net buying or selling by individuals in a stock is related to the stock’s past... 

The capital structure of a firm significantly impacts its risk. Various theories have attempted to model the behavior of firms, with three of the most important being the Static Trade-Off Theory, the Pecking Order Theory, and the Market Timing Theory. In this study, using the Static Trade-Off Theory and the partial adjustment method, the effect of the real interest rate and the direction of deviation from the optimal capital structure on the speed of capital structure adjustment to the optimal leverage ratio was examined. The study data includes financial statements of non-financial firms in the Iranian capital market from 2002 to 2022. The results show that when a firm significantly... 

Fixed-income funds' success in attracting money to the market is a significant contributing factor to the expansion of the Iranian bond market. Bonds, on average, constitute more than 40 percent of fixed-income funds' portfolios. These funds guarantee a monthly minimum profit of between 1.5-2 percent. On the other hand, stocks, on average, constitute more than 10 percent of fixed-income funds' portfolios. Because of extreme fluctuations in recent years in the stock market, there was significant volatility in those portfolios. The fluctuations in portfolios and guaranteed minimum profit make us think that funds may manipulate other assets, specifically the bonds, to smooth monthly returns. In... 

Using the data of the Tehran Stock Exchange, we analyze the characteristics and explanatory factors of major intra-group and out-of-group transactions and test the tunneling hypothesis in intra-group transactions. We find that out-of-group transactions can be largely explained by changes in control or management, firm size, and the type of the firm. However, intra-group transaction properties mostly depend on the difference between the parent company's cash flow rights in the buyer and seller companies. Also, in the final analysis, we conclude that many intra-group transactions are made to change the structure of the business groups, especially when investment companies buy shares of listed...