Abstract
This study examines exchange rate and its effect on shares turnover of KSE. The motivation of the schoolwork is to explore the association involving the variables i.e. exchange rate and shares turnover that how a single unit variation in exchange rate manipulates the overall trading volume of the stock market. Data consisting on daily quotes which has been extracted for the period 2009 to 2013 from official sites of KSE and SBP. In order to stumble on the association Regression and Correlation analysis tools were adopted. Domino effect point out that there is significant relationship exist between the variables which express that trading volume of the stock market is subject to deviation in the exchange rate.
Keywords: Exchange rate, Shares Turnover.