The major purge of the Kingdom's elites was described as an anti-corruption drive by state officials, although outside observers suspected the exercise could be part of a broader movement by Crown Prince Mohammed bin Salman to consolidate domestic power.
Either way, the purge is likely making investors see Saudi assets as riskier, so they're set to demand higher returns.
"It depends what your timeline is. If your timeline is next week and you're looking to invest next week then I would say this probably shouldn't be welcome," Michael Stephens, a research fellow at U.K. think-tank the Royal United Services Institute, told CNBC on Monday.
Saudi's bin Salman has previously vowed the Kingdom will return to "," as Riyadh continues to push ahead with sweeping cultural and economic reforms.
Some believe the extraordinary purge is an attempt by bin Salman to consolidate his power by eliminating potential rivals. And that may herald political uncertainty, tension and possibly unrest not seen before in the history of OPEC's biggest oil producer.
"Whatever way you look at it, Saudi Arabia had a massive, great big wall in front of it. It had a population bubble, it had an unemployment problem and it was not doing really that much to solve any of these things," Stephens said.
"Now what you might say is if you make an omelet then Mohammad bin Salman had to break a few eggs, and so if you are looking at the medium to long-term, actually it doesn't look so bad."
The crown prince is currently undertaking the mammoth task of rapidly transforming Saudi Arabia's economy. The Kingdom aims to raise about $100 billion by taking a portion of its state oil giant Saudi Aramco public next year. The funds will underwrite an effort to diversify the nation's economy through a plan called Vision 2030.
—CNBC's Sri Jegarajah and Reuters contributed to this report.