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Should You Buy The “TUR” ETF?

November 21, 2014
Is Turkey The RIght Place To Invest?

Three Factors To Consider Before Buying “TUR” ETF.

  1. Lower oil – If oil stays low, then Turkey should thrive. Turkey greatly depends on oil imports. In 2014 the price of oil fell and Turkey’s balance of payments looked better. Low oil prices bode well for the future growth of Turkey. Low cost energy means lower production costs and energy costs thus helping to fuel GDP growth in Turkey. This also improves the Turkish balance of payments so that the country’s balance sheet looks better.
  2. Dollar denominated debt – Turkey has lots of dollar denominated debt which is more vulnerable with the increasing strength of the U.S. dollar. As Janet Yellen and the U.S. Fed raise interest rates in 2015 the dollar could continue to strengthen. Ironically, oil is also denominated in dollars so a rising dollar means lower oil prices and vice versa.
  3. Turkey’s central bank - Turkey’s central bank has room to continue to ease interest rates through its monetary policy. These lower interest rates can help spur the economy forward. Some countries like Japan have such low rates that they have no juice left to push the economy higher. Turkey on the other hand has this monetary capacity which can bode well for stocks if the central bank continues to ease.

In one’s investment portfolio allocate no more than 5% of your portfolio to a single country. We did research and found that Fidelity offers 25 commission free trades for ETFS. A responsible investor would build a portfolio of various country ETFs that one would  think might have potential in the future. Some other ideas for interesting countries include Thailand, Korea, Peru, and Greece.  Any way we hope our research has been helpful to you and feel free to contact us with your thoughts or questions.

What Is The Best Way To Invest In Turkey?

November 20, 2014
Investing in Turkey with and ETF

We Researched How To Invest In Turkey With A Skeptical Eye. So we looked at Turkey from a non biased perspective to try to come up with the best investment vehicles possible. We thought there would be several options, but we ended up finding out that just one ETF really dominates the space. The ticker is “TUR” created by iShares, which by the way we have no affiliation with whatsoever. The ETF was started in May 26th, 2008. We looked into the contents of this ETF and were impressed. Currently is has a broad mix financial stocks, telecom and consumer products. Some of the top holdings of the iShares MSCI Turkey ETF include the following: GARAN, TURKIYE GARANTI BANKASI A, AKBNK, AKBANK A, TCELL, TURKCELL ILETISIM, HIZMETLERI A, BIMAS, BIM BIRLESIK, MAGAZALAR A, HALKB, BANKASI A.  If you were anything like me, then you had never heard of many of these companies. So after digging deeper we found that we were woefully ignorant and should have known these companies. They are some of the heavy hitters in banking and telecom in Turkey. So despite the heavy weighting in financials we like this ETF. The fees are a little over .61% and again the ticker is “TUR.”