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Create an Index Fund in Turkey

Create an Index Fund in Turkey

This article explains how to create an Index Fund in Turkey in general terms. Are you one who is aware of the growth and high-profit return from investment in Turkey or interested to invest in Turkey but doesn’t have that much money? Maybe you don’t want to settle in Turkey but really want to get the benefits from the growth of Turkey.

Create an Index Fund in Turkey

If so, it looks like creating Index Funds in Turkey and investing in Turkey’s Index Funds is the most convenient option for you. Nowadays investment opportunities are not bound in territories and foreign investors can invest and be a part of the growth of Turkey from investing in Index Funds.

What is Index Fund?

Index Funds and Its Fundamentals

An index fund is a type investment portfolio of stocks/ bonds or mostly in the form of the mutual fund that match/track the performance of some real financial market index and mimic that. It has lower fees and expenses and an ideal long-term investment plan with low risks, as it is established with the theory that the market which it follows will certainly outperform in the long-term. Nowadays it is the most popular option for common people (investors) to take advantage of the growth of any country by investing overseas in the form of index funds of that country.

The index funds have the following benefits:

– Index funds are the ultimate definition of diversity. You can create your own profile by choosing from almost any type of stock from any sector. The index fund profile is always customized.

– Low expense ratios than regular stocks or other funds.

– Strong long-term returns are the best benefit from index funds, as it is the mimic of that market, so the return is always strong in the long-term.

– Ideal for passive, buy-and-hold investors. So, any foreign investors can buy from any part of the world.

Index Fund in Turkey

Foreign investors can create index funds in Turkey to get the direct benefits of the growth from any sector. The Turkish index fund is a tracker type as it follows certain investment indexes. In Turkey, most popular index funds are in the form of mutual funds and exchange-traded funds (ETFs) and are made in the form of open-ended investment companies. If some criteria are maintained, then pension funds are also considered as index funds.

How to Create Index Fund in Turkey

The Capital Markets Board (CMB) is the board of authority for index funds. The minimum amount is 2 million TRY to open an investment company as a joint-stock entity through Turkish Trade Registry then with the CMB approval operations can be started.

There is also another condition that the investment sum must rise to a minimum of 4 million TRY in the next 6 months. Yes, as low as US$ 0.58 Million/ 0.52 Million needed within 6 months.

Open a Joint-Stock Company in Turkey