Archive of Journal - Financing

Financing – scientific magazine for economy

ISSUE 2020, No. 2, Article 3, Year of publication: 11, June, 2020

Investment in credit derivatives in developing markets


Goran Radivojac, PhD*; Miloš Grujić**

*PhD Full Professor, University of Banja Luka, The Faculty of Economics, Department for Accounting and Business Finance
**Chief Executive Officer at Republic of Srpska Pension reserve fund management company



Credit derivatives are securities that offer protection against credit risk. The credit derivatives market is growing rapidly as credit deriva-tives have gained widespread use. The paper describes the characteristics of credit derivatives. The contribution of credit derivatives in risk sharing in emerging markets is also examined. The problem of this research is making quality investment decisions of institutional
credit risk in developing markets. The aim of this paper is to provide a scientific explanation and description of the process of monitoring and managing credit risk and the characteristics of credit transfer. In addition, the paper defines a model that will serve to reduce risk exposure while respecting the specifics of business and management in emerging markets.

Keywords: risk transfer, risk management, risks, investing

DOI: DOI: 10.7251/FIN2002029R

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