Turkey ETF Becomes a Hot Destination

| About: iShares MSCI (TUR)

Turkey is considered one of the top investment destinations in emerging Europe, and investors may access the market through the Turkey-related exchange traded fund. It isn’t just retail investors looking at the country. Institutional investors are also throwing money into the rapidly growing region.

Mark Mobius, Singapore-based chairman of Templeton Asset Management’s emerging markets group, announced that his company will invest an additional $250 million in Turkish equities on top of the $1 billion already invested as a result of the highly attractive nature of Turkey’s market, according to Investment News. The Turkey ISE National 100 index has increased 24% year-to-date, the highest among major European gauges, and is set to hit a 20% advance this quarter.

Banking, oil and consumer shares are considered the top sectors in Turkey, remarks Mobius. Turkey didn’t have to bail out banks after the global crisis, and Prime Minister Recep Tayyip Erdogan said that the country doesn’t need external assistance from the International Monetary Fund to meet its borrowing needs.

Erdogan stated that the “Turkish economy continues to take giant leap forwards, develop and grow on the contrary to many other economies in the world,” according to World Bulletin.

Turkey’s economy grew by 10.3% in the second quarter. The unemployment rate dropped to 10.5% in June as economic activity picked up. The budget deficit was down 54% in the first eight months of the year, while revenue rose 20%.

  • iShares MSCI Turkey Index (NYSEArca: TUR): The top-weighted sectors are financials (51.6%), industrials (11.6%) and telecom (10.2%)

Full disclosure: Tom Lydon’s clients own shares of TUR.

Max Chen contributed to this article.