The Tehran Stock Exchange (TSE; , romanized: Burs-e Owraq-e Bahadar-e Tehran) is Iran's largest stock exchange, which first opened in 1967. The TSE is based in Tehran. TSE, which is a founding member of the Federation of Euro-Asian Stock Exchanges, has been one of the world's best performing stock exchanges in the years 2002 through 2013. TSE is an emerging or "frontier" market.

Iran's capital market has companies from a wide range of industries, including automotive, telecommunications, agriculture, petrochemical, mining, steel iron, copper, banking and insurance, banking and others. Many of the companies listed are state-owned firms that have been privatized.

In December 2025 study published by Isfahan University Journal of Sociology argued the exchange had gone financially bankrupt with rampant mafia takeover, organizational corruption, with the exchange having turned into an anomie market with insider trading.

History

The concept of stock industrialization dates to 1936, when Bank Melli, together with Belgian experts, issued a report detailing a plan for an operational stock exchange in Iran. However, the plan was not implemented prior to the outbreak of World War II. It did not gain traction until 1967 when the government revisited the issue and ratified the Stock Exchange Act. Initially limited in size and scope, the Tehran Stock Exchange (the "TSE") began operations in 1967, trading only in corporate and government bonds. Iran's rapid economic expansion in the 1970s and a popular desire to participate in the country's economic growth through the financial markets led to a demand for equity. The Government became actively engaged in the process by granting shares to employees of large state-owned and family-owned enterprises. Market activity increased substantially, as both companies and high-net-worth individuals participated in the new-found wealth associated with the TSE.

Everything came to a standstill after the Islamic Revolution leading in a prohibition against interest-based activities and nationalization of major banks and industrial giants. Mobilization of all resources towards the war effort during the 8-year Iran–Iraq War did not help matters. Following the end of the war, the 1988 Budget Act re-established activity on the TSE, and within eight years the exchange saw its numbers rise to 249 companies listed. The Government fully embraced economic reforms and a privatization initiative in 1989 with a surge of activity in share activity of many state-owned companies through the defined targets in the first "Five-Year Economic Reform" where the Government together with the Parliament defined the economic prospects of the country for the coming five years. Attention to promotion of the private sector and new interest in the TSE brought life back to the market. However, lack of regulation and out-of-date legal framework led to crisis in the market leading to certain "meltdowns". Over the 1996 to 2000 period an automated trading system was introduced, and a number of important regulatory mechanisms were strengthened. The market has experienced its share of highs and lows in the past years including topping the World Federation of Exchanges' list in terms of performance in 2004. As of May 2014, the TSE has had three bear markets in its history: August 1996 – July 1998 (−32%); December 2004 – July 2006 (−34%); and during the 2008 financial crisis (−38%).. Turquoise Partners (July 2014). Retrieved August 16, 2014. In 2014, after reaching historic highs, TSE lost a quarter of its total market capitalization because of the collapse of the Iranian rial and the slump in oil prices. It was also decided in 2014 that some banks and financial institutions attached to the government inject money into the stock market through a fund called the Market Development Fund which is aimed at market making and decreasing the fluctuations in the stock market.

Other complementary markets have also been established alongside the equities market. In 2003, the Tehran Metal Exchange (now called the Iran Mercantile Exchange after its merger with the Agricultural Exchange in 2006) was launched. On December 2005, the Securities Market Act of the Islamic Republic of Iran was ratified, marking a significant reform in the country’s capital market through the demutualization of its structure. In alignment with the 2005 reforms, Central Securities Depository of Iran was founded as an independent legal entity, tasked with providing centralized registry, custody, clearing, and settlement services for all financial instruments traded in Iran’s modern capital market. The Oil Bourse and the over-the-counter Farabourse were launched in 2008 followed in 2012 by the Energy/Electricity Bourse and the FOREX bourse.

+Main Indicators for TSE* 2006 2007 2008 2009 Number of Listed Companies 417 415 346 337 Market Capitalization (USD Millions) 43,794 45,574 49,040 58,698 Total Value of Share Trading (USD Millions) 6,230 7,872 15,252 16,875 Daily Average Trading Value (USD Millions) 26.1 32.5 63.8 65.4 Total Number of Trade in Share (Millions) 15,839 23,401 37,975 82,479 No. of Transactions (in thousands) 1866 2107 1978 2646 No. of Trading Days 239 242 239 258 Share Turnover Velocity (%) 15.6 16.37 26.5 28.74 P/E ratio 5.4 5.2 4.1 5.5 Dividend yield (%) 10.44 14.5 12.3 15.8 Market Capitalization/GDP (%) 17.9 15.4 14.1 15.2 *Exchange rate: 1 US $=10,004 IRR (2009)

Industry affiliations Since 1995, TSE has been a full member of the World Federation of Exchanges (the former Fédération Internationale des Bourses de Valeurs or FIBV), and is a founding member of Federation of Euro-Asian Stock Exchanges (FEAS). Since July 2010 the TSE is a member of the International Options Market Association.

Logo The symbol of the TSE is a highly stylized representation of an Achaemedian dynasty (550-330 BC) gun-metal relief artifact, which was found in Lorestan province. The artifact features four men, hand in hand, indicating unity and cooperation. They are shown standing inside circles of the globe, which is in turn, according to ancient Iranian myth, supported on the backs of two cows, symbols of intelligence and prosperity.

Structure

The Securities & Exchange Council is the highest authority and is responsible for all related policies, market strategies, and supervision of the market in Iran. The Chairman of the Council will be the Minister of Economics; other members are: Minister of Trades, Governor of the Central Bank of Iran, Managing Director of the Chamber of Commerce, Attorney General, Chairman of the Securities and Exchange Organization, representatives of the active market associations, three financial experts requested by the Economics Minister and approved by the Council of Ministers, and one representative for each commodity exchange. The Securities and Exchange Organization (SEO) is responsible for administration and supervisory duties, governed by the Board of Directors. The SEO's Board of Directors are elected by the Securities and Exchange Council. SEO also actively promotes innovation in Islamic products and has formed a specific "Sharia committee" to assess the compatibility of new products with Islamic law. SEO is the sole regulatory entity for the regulation and development of the capital market in Iran.

Corruption, inside trading, interference and control The Iranian stocks went into free fall in July 2023 and lost more than 2 million units of value. The Iranian Judicial chief demanded questioning from the president and a member of parliament called for firing the stock exchange organization's CEO. Eghtesadnews called it death blow for stock exchange. Etemad wrote the stock exchange lack transparency, government conflict of interest. Supreme Council of stock exchange threatened to leak everything related to corporations even state corporations corruption.

Operations

Under its new structure, TSE has online trading, an arbitration board, digital signature, investor protection, surveillance mechanisms as well as post-trade systems.Pre- and post-trade services for the Tehran Stock Exchange are provided by the Central Securities Depository of Iran (CSDI). The TSE is open for trading five days a week from Saturday to Wednesday, excluding public holidays. Trading takes place through the Automated Trade Execution System from 9am to 12 noon, which is integrated with a clearing, settlement, depository and registry system. Settlement is T+3. The TSE is solely an order-driven market and all transactions are executed in the manner and under the principles of open auction.

Trading platform

The Tehran Stock Exchange (TSE) has started an ambitious modernization program aimed at increasing market transparency and attracting more domestic and foreign investors. Concrete measures that have been taken in the planning and operations of the stock exchange such as the settlement system, geographical expansion, new exchange laws in order to attract local and foreign capital. The TSE has installed the new trading system which has been purchased from Atos Euronext Market Solutions (AEMS) in 2007.

The new system makes it possible to purchase and sell stocks on the same day. The system has also made it possible for 2,000 brokerage stations to work simultaneously, while the number was just about 480 in the past. The rise in electronic dealing, non-stop input and updated data on orders, transactions and indices are among other features of the new system. The new system has made it possible to link the stock market to the international bourses. The bourse can now handle 700 transactions per second and 150,000 transactions per day.

The trading system is an order driven system, which matches buying and selling orders of the investors. Investors can place their orders with TSE accredited brokers, who enter these orders into the trading system. Then, the system automatically matches buy and sell orders of a particular security based on the price and quantity requirements. The mechanism for which the price of equities is determined is as follows:

The best price (price priority) Time of order priority

Under the price priority rule, a selling (buying) order with the lowest (highest) price takes precedence. Under the time priority rule, an earlier order takes precedence over others at the same price. Thus, when the lowest sell and the highest buy orders match in price, the transaction is executed at the price. In short, the TSE market is a pure order-driven Market.

The trading system also generates and displays details of current and historical trading activity, including prices, volumes traded and outstanding buy and sell orders. This ensures that investors have the required information to be able to take informed investment decisions.

The range of price movements is typically restricted to 3% daily either way from last closing (raised to 5% since May 2015). Restriction on Rights is 6%. This can be changed in specific situation by the Board of the TSE in case of unusual price movements resulting in an extremely high or low P/E ratio. Short selling is not permitted. There are no minimum trading lots. According to the Iranian Commercial Law, companies are prohibited from share repurchases. TSE Services Company (TSESC), who is in charge of the site, supplies computer services. TSESC is a member of Association of National Numbering Agencies (ANNA).

Market segmentation