Examining Relationshionship Between on Limit Price And Information Asymmetry In Tehran Stock Exchange

Abstract

Price Limit is a type of circuit breaker which is applied in future markets and also some of stock exchanges in emerging markets. In this research we try to examine the relationship between price limit and information asymmetry before earning announcement in TSE(Tehran Stock Exchange) The time extent of this research is from 1383 until 1390. Statistic sample the all of company in Tehran stock exchange. our sample are the 116 companies . Statistic information is obtained from the tadbir and rahavard novin software. statistic tests that were Used are correlation and multi variable regression and ordinary least Squares(OLS). Results show that there is a significant between the price limit and information asymmetry. we found either the trade price has Significant effect on information asymmetry. In fact decreasing in price limit could be lead to increasing in informational market efficiency and decreasing in information asymmetry.

Keywords

• Price Limit
• Information Asymmetry
• Bid
• Ask spread
• Tehran Stock Exchange