Turkeys Capital Markets Regulator Dissolves 131 Investment Funds
Turkey’s Capital Markets Board (SPK) has decided to liquidate 131 funds following problems in some investment funds. About 455,000 investors and assets estimated at $20 billion have been affected by the decision.
The liquidation process of these funds and the expansion of judicial investigations have become one of Turkey’s major financial issues in recent months. However, the exact rate of return and its timing for investors remain unclear.
The funds’ problems emerged in mid-September when some asset management companies, including Tera Portföy and Pusula Portföy, faced difficulties responding to investor withdrawal requests.
The reported asset value of these funds is estimated at around $20 billion, but according to experts, this figure does not necessarily mean the actual amount of investors’ initial capital or the recoverable amount.
An advisor from East Capital stated that a significant portion of these funds’ assets was invested in shares of small companies with low trading volume and low free float, which are difficult to sell. He added that the announced value of these funds may have been inflated earlier and the decline in asset values should not be considered entirely as a real cash loss.
An analyst at GlobalSource Partners also presented a more pessimistic picture in his assessment. Based on the assessment of two experts he trusts, even a return of 20 cents per dollar invested in some troubled assets may be optimistic. He further emphasized that this prediction is not based on the final valuation of the assets and merely stems from other experts’ assessments.
Mehmet Şimşek, Turkey’s Minister of Treasury and Finance, had publicly stated in November 2025 that some funds were manipulating the market and promised stronger oversight and regulation.
Also, MSCI, in its market classification review in June 2026, expressed concerns about the possibility of coordinated trading in the assets of funds linked to some small Turkish companies. According to the timeline of Turkey’s Capital Markets Board, the institution identified price movements caused by funds in late 2025 that could not be explained by companies’ fundamental indicators. This issue was reviewed in December 2025 at the Financial Stability Committee, and Turkey’s Capital Markets Board formed a working group. However, despite numerous regulations enacted during 2026, these measures could not prevent the September liquidation.
Experts have emphasized that this situation has not spread to the entire Turkish fund market. An economist stated that out of Turkey’s $200 billion fund market, about 10% of market value has been affected, and out of more than 2,600 funds, only 131 funds have been affected.
However, during the liquidation process, volatility may continue, and domestic and foreign investors may remain in a wait-and-see mode for some time. If claims related to political connections spread in global financial media, foreign investors may stay away from the Turkish stock market for a while.
