Iran Capital Market
Establishing the capital market of Iran in the 60’s and the country’s attention to industrial activities and financing them on the agenda and the first law of the capital market was approved in 1967 by the National Assembly. Then in 1968, with the approval of the shares of the Industrial and Mining Development Bank of Iran and Pars Oil Company, the first stock exchange in Iran began its work officially. After the adoption of the Law on the Securities Market of the Islamic Republic of Iran in 2008 in the Islamic Consultative Assembly and establishing the Securities and Exchange Organization as a supervisory authority in the capital market of Iran, the establishment of Tehran Stock Exchange companies and Iran’s over-the-counter, the capital market of Iran with a different structure And consistent with global standards for growth and development..
Tehran stock exchange is divided into first, second, derivative, debt and exchange traded funds (ETF). In 2017, total deals value in the stock exchange was 638540 billion Rials. Many Indexes are being used in order to check the market process which the total market index is the most popular one. In 1990 the total market index were defined as 100 number unit and in 2017 this index declined from 80219 to 77230 unit
Iran OTC (over the counter exchange) covering 9 markets (first, second, third, small and average company market, base market, modern financial tools market and Derivative) with different regulation and functions. Total OTC deals value in 2016 was 461282 billion Rials. In 2016 OTC Overall index had a 9 percent growth and reached from 806 to 875 unit. The essential financial statements, financial data and important information of accepted companies in Iran capital market are published in the CODAL system one of the existing challenges for foreign investors is publishing the essential financial statements in the country standard national accounting format. To achieve this goal, Securities and Exchange Organization has started to use standard international financial reporting in Iran capital market in order to change the infrastructures and attract foregone investors.
The studies indicates that Iran capital market performance was not very strong and most of the exchange deal commission (Deals in the securities and exchange) are almost 1.44 percent of the deal value. In addition, following the instruction and regulation reforms in 2017, Securities and Exchange Organization has changed the stock deal settlement time from three days after the deal (t+3) to two days (T+2) in order to increase Iran capital market liquidity process.