Investigating the Effect of the Quality of Business Nature Disclosure and Financial Performance on the Professional Investors’ Judgments

Disclosure of useful and high-quality information can improve investor decision-making in the capital market. One of the channels of Information disclosure in the capital market is the management commentary. The purpose of this study is to investigate the effect the quality of disclosure of the business nature of the management commentary and the financial performance of the company on the decision-making of investors. To test the research hypotheses, a scenario-based questionnaire has been used. The period of research is 2018. The statistical population consists of all active professional investors in Tehran Stock Exchange (TSE) and the research sample consists of 160 professional investors. The results of the study showed that professional investors tend to more ( less) investment in a condition which the quality of business nature disclosure is high (low). Also, the results of the research point out that in condition of incremental (decrease) financial performance, the high (low) quality of business nature disclosure is increases (low) the willingness of professional investors to investment. In addition, the results of the research indicate that with increasing (decreasing) the quality of business nature disclosure, professional investors ' decision-making on the earnings persistence of company is increases (decrease).