Cash Holding Levels, its Adjustment Speed and Financial Leverage Ratio in Tehran Stock Exchange (TSE)

The liquidity of a firm can be defined as the access to cash in times of need. Companies that are faced with a deficit or surplus cash, both will face many potential problems. Therefore, in this study, the optimal cash have been identified and then adjusting the cash speed companies to optimize cash was tested. Then, the speed of adjustment with regard to the Company's financial leverage was investigated. For this purpose, financial information for 2011 to 2016, 120 companies have been studied. The results show that, companies below optimal cash, compared to above optimal cash, Move more rapidly toward the optimal cash. In addition, the result show that When leverage in the model used, the speed of adjusting optimal cash for below, is much higher than that of above optimal cash companies.