The Investigation of Free Float Change Effects on Stock Return in Tehran Stock Exchange (TSE)

In this study the effect of “changing the amount of free float” on the “stock returns” in listed companies of Tehran Stock Exchange has been studied. The purpose of this study is to answer this question that whether change in the amount of free float has information contents and can help shareholders to better decisions. A sample of 147 companies were studied for a period of 5 years from 31/06/1383 till 31/06/1388. In this study, In addition to the experimental group, a control group has been used to confirm results of research and the Paired-Samples T Test method has been used to test research hypotheses. The results show that change in the amount of free float, has information content and significant effect on stock returns and decreases the stock returns. The results also suggest that the change in the amount of free float has different effect in different industries.