Summary

I often turn to CDS data to help me determine the forward-looking directional movement of equitie.

I’ve found that when significant divergences take place between two data points - credit and non-credit - the CDS data has been highly predictive.

In fact, I’ve yet to see an instance where a large divergence between the two data points occurred in which the non-credit data proved to be ultimately correct.

I’ve presented several instances across energy - both oil and natural gas focuses - in which a divergence between CDS data and equity pricing data occurs.

In each instance, the CDS data proves to have predicted the ultimate direction and convergence of data points; CDS data has been predictive of equity direction.