Abstract

The objective of the business unit is to increase the stockholders' wealth, so it is very important to provide their expected returns. Investors and creditors are looking for an accurate measure to assess the company's performance and decide on the continuation or exiting of a new investment. Economic value added is an analytical tool for finding the true value of a company, in other words, performance is an alternative to accounting profit as a measure of evaluation. In this research, we attempt to examine the effects of the stock market's liquidity and the economic value added to the value of the company by presenting a model. We also try to identify the significance of the relationship between the above variables. In this framework, lower capital costs and higher economic value added indicate a performance enhancement and increase in liquidity, and ultimately the sum of these factors increases the value of the company. Using a combined study method, we study the data of 154 companies listed on Berlin Stock Exchange during 2010 to 2015. The research results are as follows; there is a positive and significant relationship between economic value added and stock market liquidity; in addition, the strong and significant correlation between variables and company's value also confirms their impact on each other.