Abstract

In this study, presence of long-run relationship between (Price) BIST 100 Index Closing Prices (January 1986=1)(BIST), Weighted Average Interest Rate (AOFO), USA Dollar (Effective Buying)(USD) and Euro (Effective Buying)(EUR) is examined in Turkey. Findings are trying to consolidate with the Johansen Cointegration test results, and then the regression equations which generated for each variable and results of the regression equation Coefficient Attached Vector Error Correction Model (VECM). The causality between the variables which are confirmed on the basis of the findings are examined with Granger causality test (Wald) and impulse-response graphs. In light of the results which obtained, planned to determination about which model is going to be valid in Turkey Flow-oriented models or Stock-oriented models. Whether valid cointegration relationship between variables, if there are any kind of causality, understanding of the direction and intensity of the causality would be useful for accurate detection of the method will use and considered to be increased to the success rate of the method used in the portfolio management Strategies.