EFFECTS OF FINANCIAL INFORMATION TRANSPARENCY ON INVESTOE BEHAVIOR IN TEHRAN STOCK MARKET

Subject Areas : Financial Knowledge of Securities Analysis

Maryam Khalili. ¹ , Samad Behroozizad ²

1 - نویسنده اصلی و مسئول مکاتبه
2 - ندارد

Received: 2009-04-09 Accepted : 2009-06-14 Published : 2009-03-21

Keywords: Investor Behavior, Corporate Governance, Agency theory, Stewardship theory, Stakeholder theory,

Abstract :

For almost a decade the transparency of financial information has beenan important influence on investors, investment strategies. An increasingamount of research shows that the availability and quality of companies,financial information are tow major factors influencing investorinvestment decisions (Young, 2003). Young has found that after financialscandals of Enron Oil Company in U.S.A poor corporate governanceresulting in a lack of financial information transparency has shakenpublic confidence in stock market (Young, 2003).This study analyzed the effects of financial information transparency,which is the fifth principle of the six principle of corporate governance,on investor behavior and it present a framework for evaluating of investorbehavior by concepts of ownership structure, financial transparency andboard structure.In this study, the researcher tried to present an appropriate literature inthe field of corporate governance and to determine the effects ofconducting of the fifth principle (principle of disclosure andtransparency) on investor's behavior in Tehran Stock Market by carryingout researches such as those which were conducted in developedcountries.Data of this study was collected by a survey instrumentcontaining 19 closed-ended questions which answered by investors whohave experience buying corporation share from the Tehran StockExchange, and by statistical analyzing of these answer the researcherinspects the effects of Financial Information Transparency on investorbehavior.The different statistical models which used for examining ofhypothesis are descriptive statistics, correlation analysis and conductingstatistical examinations showed that Financial Information Transparencyhas a positive correlation with investor behavior and improving FinancialInformation Transparency lead to increasing of shareholders, confidencein Tehran stock market and increasing of their investment in stockmarket.