The Effect of Stock Liquidity on Firm's Value: Evidence from an Emerging Market

摘要

The purpose of this study is to examine the relation between stock liquidity and firm value. Using data from 142 firms registered in Iran's Tehran Stock Exchange in 2008, the results show that stock liquidity does not have impact on firm value. Our findings are inconsistent with previous studies which have been done on the NYSE, Amex, Nasdaq, and in the same market. It may be due to the prevailing economic conditions and the volatility of politics in emerging market. The results of this study have some implications for domestic and potential foreign investors.