We conducted a global study of the long-term issuer ratings of nonfinancial firms from Standard and Poor's Ratings Services (S&P) for the period 1998-2003. Specifically, we focused on the solicited versus unsolicited ratings and sample-selection bias in the analysis. Unlike the literature, we...

The authors conducted a global study of the long-term issuer ratings of nonfinancial firms from Standard and Poor's Ratings Services (S&P) for the period 1998–2003. Specifically, they focused on the solicited versus unsolicited ratings and sample-selection bias in the analysis. Unlike the...

The Merton-type structural model, when extended to sovereign issuers, suggests a negative relationship between sovereign credit default swap (CDS) spreads and stock prices. Capital structure arbitrage strategy that exploits such relationships should foster the integration of CDS and the stock...