CHARACTERISTICS OF CREDIT DEFAULT SWAPS AND DEVELOPMENT OF 5 YEAR CDS PRICES OF PORTUGAL AND SELECTED COUNTRIES

In the article we will try to define a credit default swap (CDS), while paying attention to the comparison of CDS with the insurance product. In the next section we will describe the developments in 5 year CDS prices of selected countries, with particular focus on Portugal. Also, we will realize a comparison of CDS and we will point out the development in prices of 5Y CDS in 2012, as well as their practical interpretation.