M.A. Thesis:

The role of the stock market in firms investments

Recent theoretical studies have already started the first footstep to connect the financial market and economic development. It is suggested that higher per capita income profits may influence several features of the economy, as well as the performance of the stock market. Researchers seized various opinions concerning the significance of stock markets performing an important role within the processes of the economic development by carrying out the following functions: developing liquidity, mobilizing and aggregating capital, monitoring mangers, as well as applying company control, offering risk pooling, as well as the services of sharing involving the levels of investment. The rising theoretical literature disputes that stock markets are significantly connected to the economic development. The main purpose of this study was to investigate the role of the stock market in firms’ investments in Tehran Stock Exchange. The present research is applied in terms of purpose and analytical nature. To collect the data, we used the financial statements of the Tehran Stock Exchange and Rahavard Novin softwer. The statistical population of the research is 109 companies from listed companies in Tehran Stock Exchange between 2013-2018. The findings of this study show that q tobin ratio has a positive and significant relationship with financial leverage and the current ratio has a negative and significant relationship with corporate investment rate, but no significant relationship was found between sales revenue and cash flow in the previous year

Keywords: q Tobin, firms’ investments, stock market