ARTICLE
TITLE

The effect of Stock Liquidity on Corporate Cash Holdings in Tehran Stock Exchange

SUMMARY

Stock illiquidity causes shareholders encounter some costs when they purchase or sell stocks and it results in investors demanding more return when purchasing compared to stocks with higher liquidity. Accordingly, the present research is going to investigate about the effect of stock liquidity on cash holding level. In this study 91 firms enlisted in Tehran Stock Exchange between the years 2010 and 2014 have been investigated. To test the hypotheses we have used linear and multiple pooled regression models. Research findings showed that the difference in price between supply and demand has had a meaningful effect on cash holding but zero return has had a negative and meaningful effect on cash holding. Also market depth, resiliency, and immediacy in the market did not have a meaningful effect on cash holding. 

PAGES
pp. 2133 - 2145
COLLECTIONS
Social Sciences

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