The most important event in the world is the presidential election in the United States of America, to which the stock markets of many countries react. This reaction may differ according to the presidential period in which one of the candidates is selected. Accordingly, our research aims to investigate the effect of two presidential periods with two different parties on the stock returns of companies listed on the Tehran Stock Exchange. Hence, using the analysis of 650 firm-year observations for the first period and 1095 firm-year observations for the second period, for two different presidential periods, respectively, the presidency of Barack Obama (Democratic Party) and Donald Trump (Republican Party), we find that the elections and the presidential period of both parties have a negative, significant effect on the annual cumulative stock returns of companies. Results show that investors react to events such as elections, even in emerging markets like Iran.
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