Özet:

This study attempts to examine the interaction of credit default swap (CDS), which stands for risk premium, with the stock exchanges of developing countries. To this end, 5-year CDS premiums belonging to Turkey, Argentina, Brazil, Indonesia, Malaysia, and China were obtained on a daily basis between April 2009 and April 2014 and were compared with stock exchange index closes in the same period. Data were analyzed via regression curve estimation models. Insignificant relationships were found between CDS premiums and index closes in 2 of 6 countries while significant relationships were found in other countries. It was concluded that investors investing in developing countries that have an investment potential take into consideration CDS premiums as country risk.

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