A Turkey of an Investment


Let’s talk Turkey… Turkey equity investments that is… because US equity investments might become turkeys now.

Turkey-share-data

Photo of Istanbul from Economist article linked below.

The Top Value Emerging Market Model Portfolio analyzed by Keppler Asset management contains ten markets; Brazil, China, the Czech Republic, Egypt, Hungary, Poland, Russia, Taiwan, Thailand and Turkey at equal weights.  I always keep my eyes on Keppler’s good value markets which is why I see Turkey as interest now.

The US dollar has been rising. This creates a  huge opportunity for those who are still loaded with greenbacks.  This is a great time to diversify out of the dollar while  it is so strong and turkey may be one place to look.

US stocks have lost momentum and have shown that they nor the major players there are not especially trustworthy… as in JP Morgan… Facebook and such.

Last May 16, 2011 I wrote: I have sold the last of my Turkish shares and wrote:  Last year 2010, I recommended investing in Turkish equities.  I invested in the Jyske Invest Turkey Equity Fund at that time.

Istanbul McDonalds by SpirosK.

I made some nice profits and when the share price had doubled by November 2010, I sold half my shares.

Now I have completely eliminated my holdings in Turkey even though this market is ranked as a good value market by Keppler Asset Management. Keppler’s Top Value Model Portfolio contains the nine national MSCI markets Brazil, the Czech Republic, Egypt, Hungary, Poland, Russia, Taiwan, Thailand and Turkey at equal weights.

I outlined three reasons why I eliminated my Turkish holdings.

What’s the Theme Now?

I am a thematic investor who looks for contrasts and distortions that have thrown strong economic and financial fundamentals out of whack.

Thus I was one of the first in the USA to recommend investing in the Turkey Stock Exchange over 30 years ago because the main theme of investing in Turkey is… “the world needs Turkey to succeed.”

Turkey is an Islamic country with a secular government and strong economy.  This model is one that embraces Islam and capitalism… a form of social organization that works within the global capitalistic democratic model that has proven to be most effective at enhancing the well being for the largest percentage of a population.

That’s part of Turkey’s big thematic picture.

Next, there is Turkey’s location.   The Sea of Marmara, the Bosphorus and the Dardanelles (which together form the Turkish Straits) are the boundary between Europe and Asia  making Turkey a Eurasian country bordered by Bulgaria, Greece, Georgia,  Armenia, Azerbaijan, Iran, Iraq and Syria.

Third, Turkey’s economy has been booming, the second fastest growing in the world after China.   An Economist article entitled “Istanbul and bears (linked below) says: Figures released on April 2nd showed that Turkey’s GDP rose by 8.5% in 2011 after a 9% increase in 2010 (see chart 1). These are the sort of growth rates that mighty China would be pleased with.

Turkey-share-data

Yet the Istanbul Stock Exchange National 100 Index has dropped from 64,067 to  56,695.

Turkey-share-data

Plus the Turkey Lira as seen in this chart from Google.finance has also dropped badly versus the US dollar.

Turkey-share-data

Over the past 20 years after a strong drop in the Lira and the stock index… Turkey’s stock market has shown an explosive correction up.   This may not happen soon… but now is the time to begin watching or to invest for a medium term opportunity.

How to Invest in Turkey

I never try to find specific shares in Turkey, but to invest in the market itself. Non US investors should take a look at the Jyske Invest Turkish Equity Fund.

This is Jyske Invests 4th best performers over three years.

turkey-investng-ideas

Best performance list from Jyske Invest website.

However the annual results shows how Turkey’s market is a very up and down affair.

turkey-investng-ideas

This chart of the Jyske Invest Turkish Equity Fund also shows this market’s up and down track.

turkey-investng-ideas

For more details about the Jyske Invest Turkish equity fund non US investors contact René Mathys at mathys@jbpb.dk

US investors contact Thomas Fischer about other Turkey options at fischer@jgam.com

turkey-investng-ideas

A good way for US investors to take a position in Turkey is with the Ishares MSCI Turkey Index Fund traded on the New York Stock Exchange symbol TUR.

Turkey has been on of the most dynamic long term markets over the past 20 years.  This has been a market of scorching upwards corrections after several years of equity and currency decline  and according to the analysis we follow Turkey is a good value market to consider now.

Otavalo-hotel-for-sale-images

Another opportunity is an Ecuador B&B.

Gary

Join us for our next international investing and business course during the Blue Ridge leaf change October 5-6-7

Multi Currency subscribers can see more statistics on the Turkish market at your password protected site here.

See how to get a password below.

You can read my May 16, 2011 message on Turkey for more background here.

Topics on Turkey at Economist

Istanbul and Bears


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