Analysis of the Relationship between the VIX Index and the Manufacturing Industry: The Case of Turkey

Abstract

This study is conducted to determine whether the VIX İndeks (Fear Index) is effective on Turkey's manufacturing industry. The PMI manufacturing industry index was used to represent the manufacturing industry. Time series methods that take structural break into account were used for analysis. As a result of the analysis, a structural break was detected in April 2019, when the Kovid-19 pandemic occurred, and it was concluded that this break negatively affected the manufacturing industry production. In addition, a significant and negative relationship was found between the VIX index and the PMI index. It is concluded that VIX indeks has the negative impact on Turkey's manufacturing industry.