IS POLITICAL RISK A KIND OF RISK THAT INVESTOR SHOULD CONSIDER? BORSA ISTANBUL EXAMPLE

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As it is known today, there are many risk factors that investors should consider. Creating a portfolio through diversification is possible to avoid some of these risks, some of it is not possible to manage or to intervene. One of the most important of these risks refers to as systematic risk is the political risk. Political risk, is defined as the probability of occurrence of social events such as; a country drastic changes in government policies or war, revolution, civil war, insurrection that will negatively affect investors. The purpose of this study is to determine whether political risk the prices of stocks that are traded in Istanbul Stock Exchange. For this purpose, some econometric analyzes were carried out to determine the relationship between our country s political risk ratings and BIST 100 Index. The analysis results show that there is a long-term relationship between the fluctuations in the stock market and the political risk and fluctuations in political risk lead to change in the index. Regression analysis suggests a negative correlation between two variables.

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Political Risk , Investment Decision , Borsa Istanbul

Journal Of Economics an‎d Administrative Sciences

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Journal Of Economics an‎d Administrative Sciences