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Mobius warns of possible drops in İstanbul stock market
Mobius was speaking on Wednesday in İstanbul to promote a derivative of Templeton’s BRIC Fund for the Turkish market, which makes it possible to purchase and sell selected shares traded in Brazil, Russia, India and China. The Capital Markets Board has recently approved the fund, which is a type B foreign securities fund, and registered it as a valid financial instrument for the Turkish capital markets. Akbank is the founder of the Fund and Ak Portföy will manage it in Turkey.
In his speech, Mobius shared his assessments regarding the current situation in global markets. The “bull” markets are prevailing nowadays, he said, and added that it was quite normal for bull markets to last longer than “bear” markets. “If you ask me which markets are more proper to initiate investments, I would say the best time is when you have money. No one could know for sure the exact time of a bull or bear market,” he said.
There will possibly be some corrections in the emerging markets and some of these corrections may be at the extreme, he said, answering questions from a packed audience. “Indeed, a correction in the ballpark of 20 percent is not unlikely in a bull market,” he added. Mobius avoided saying just when this correction may happen, saying: “It is hard to estimate it. But we will have plenty of chances of more deals in the stock markets once the correction takes place.”
On another question concerning the political environment in Turkey, the famous investor said he has full confidence that things will always improve in economy no matter what happens in the political climate. “Turkey is in an extremely important position in terms of investments. Besides, the Turkish government is stirring the country to a more liberal environment. Under these conditions, we believe that the country’s economy will continue performing positively to a great extent in the future,” he argued.
Templeton has investments worth $800 million in Turkey from banking to the oil industry, commodity markets and telecommunication. He also revealed his pleasure with the level of cooperation between Templeton and Akbank. Templeton manages 60 different funds in Turkey, Mobius asserted and went on: “We have quite adequate funds in Akbank in serious amounts. We may increase the volume of these funds depending on the prices.”
Mobius said the BRIC Funds are currently extremely popular with a total amount of worldwide investments of over $2 billion, underlining his belief that the fund will be successful in Turkey, too.
Akbank Vice Chairman and Ak Portföy Chairman Zafer Kurtul said the new fund was a significant instrument as it is offers investors in Turkey a chance to purchase and sell shares traded in BRIC countries. The fund will have a number of tax advantages, too, he added. “I believe the interest rates will continue to remain at low levels. Low interest rates are beneficial for us as the demand for these products is much higher when interest rates are low,” he said.
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