The Effect of Optimal Level of Cash on Future Operation and Cash Interest Coverage in Companies Listed on the Tehran Stock Exchange

Abstract

This study examines the impact of the optimal level of cash on future performance and cash interest coverage of listed companies in Tehran Stock Exchange with emphasis on the type of industry deals. For this study a sample of 107 firms listed in Tehran Stock Exchange was selected using sampling. The purpose of this study was to evaluate the effectiveness of the optimal level of cash on future performance and cash interest coverage of listed companies in Tehran Stock Exchange with emphasis on the type of industry to achieve this goal, two hypotheses have been proposed to be the, The optimal level of cash operating assets with future returns (RNOA) there is a positive direct relationship between the optimal level of cash and cash interest coverage there is a direct and positive correlation between the test data collected for the period 1385 to 1390 in the Tehran Stock Exchange and the Automotive Industry cement, lime and plaster, base metals, ceramic tile, chemical products, Food Products and Beverages except sugar, and Pharma took the study period there were a total of 535 observation. Statistical methods used in this study are multiple regression method. The results of the statistical community and the automotive industry, cement, lime and plaster, base metals, ceramic tile, chemical products, Food Products and Beverages except sugar, and took Pharma shows the relationship between the optimal level of cash for future performance to directly is positive, ie the increase in the company's cash and cash more than the optimal level of performance of the company will be added to future and also by increasing the amount of cash in the company and pass on the optimum amount of company cash, cash interest coverage is added.