Examining the Effects of Different Financing Methods on Stock Price and Corporations Return in Tehran Stock Exchange

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Abstract

This article examines the effects of different external financing methods on stock price and corporation return in Tehran stock market during 1996-2000. The consequences of share issued and long term borrowing on the stock price and monthly return of corporation in Tehran stock exchange is examined first. Then the Annual return of corporations benefiting from the two external financing methods is compared with each other and with that of the industry average.
The results show that share issuing method compared to long term borrowing has higher impact on stock price and on stock return of corporations.

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