Abstract:

In the world economy, it is known that the search for alternative barometers is increasingly widespread in investors’ investment decisions due to the lack of information flow by institutions or the negative reflections of the very long-term rating. In this context, the use of Credit Emergency Risk or shortly CDS primes as an alternative to credit ratings has become increasingly widespread. In this study, the relationship between the CDS scores and the stock index, which is the most important reflection of capital mobility, was the subject of the study for the period 2007:M12-2018:M04. According to the findings obtained, the research has found that there are long-term relationships between CDS primes and stock index values in countries outside the United States and the UK. On the other hand, the existence of reciprocal causality relationships between the CDS primes and the stock exchange index has been identified. Here it can be said that avoiding negative financial behaviors that raise the risk primes of companies will not affect both their own and the country’s financial needs.

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