|
Evaluating the Effects of Using Novel Financial Instruments on Reducing Investment Risk in the Iranian Capital Market
|
Amin Karimi   , Mahmoud Hematfar * |
| M.A. Student in Financial Management, Borujerd Branch, Islamic Azad University, Borujerd, Iran. |
|
|
Abstract: (6 Views) |
| In recent decades, the Iranian capital market has faced severe fluctuations, economic instability, and numerous risks. In such an environment, novel financial instruments have garnered particular attention as tools for risk reduction and management. The present study aims to investigate the effectiveness of these instruments in reducing various types of investment risks and to analyze their practical efficiency in the Iranian capital market. This research is applied in terms of purpose and descriptive-analytical in terms of method, employing both quantitative and qualitative approaches. Statistical data pertaining to market indicators, derivative transactions, ETF funds, and securitization over the period 2019–2023 were extracted from official sources including the Codal system, Tehran Stock Exchange, and the Technology Management Company. Data analysis utilized GARCH models, Granger causality tests, and diversification indicators such as the Sharpe ratio and correlation coefficient. Additionally, qualitative analysis was complemented through semi-structured interviews with market experts and fund managers. The results indicated that the use of derivative instruments, given the presence of an active market and adequate infrastructure, significantly reduces asset price volatility. Exchange-traded funds also played an effective role in portfolio diversification and reducing unsystematic risk. Structured instruments such as Murabaha and Ijarah bonds, when backed by appropriate collateral and favorable credit ratings, contributed to reducing credit risk. However, institutional, legal, cultural, and technical factors have hindered the full utilization of these instruments' potential. The development of novel financial instruments requires the establishment of legal, educational, and technological infrastructure to effectively reduce investment risk and enhance the efficiency of the Iranian capital market. |
|
| Keywords: Novel Financial Instruments, Investment Risk, Derivative Market, ETF Funds, Securitization. |
|
|
Full-Text [PDF 999 kb]
(8 Downloads)
|
Type of Study: Research |
Subject:
General
Received: 2025/07/21 | Accepted: 2025/08/31 | Published: 2025/10/22
|
|
|
|
|
|
|
| Add your comments about this article |
|
|
|
