The article discusses Credit Default Swaps (CDS) and their importance in the financial market, especially after the 2007 global financial crisis and the European debt crisis. CDS allow trading for various instruments with credit risk exposure. Understanding sovereign CDS spreads is crucial as sovereign defaults can harm global financial stability. The article explains how CDS markets work, their basic structure, documentation, and strategies like hedging and arbitrage. It also reviews literature on CDS pricing, determinants, and factors affecting strategies. The relationship between CDS spread and key macroeconomic factors, particularly in PIIGS countries (Portugal, Italy, Ireland, Greece, Spain), is examined.