This Stock ETF Surged +128% in One Year

Turkish Economy Resilience and Growth

In 2023, the Turkish economy demonstrated a remarkable resilience, expanding by 4.5% and surpassing the milestone of one trillion dollars in terms of gross domestic product for the first time.
This growth was mainly driven by domestic consumption, accounting for about 60% of the country’s GDP, despite internal and international political and economic challenges.
The significant increase in the financial and insurance sectors, growing by 9%, and in construction, rising by 7.8%, reflects a diversification of the country’s economic foundations.

Challenges and Opportunities in Turkey

The GDP per capita reached a record level of $13,110, an indicator of increasing prosperity despite recent economic turbulence, such as soaring inflation and contested interest rate policies under the presidency of Recep Tayyip Erdogan.
The “growth at all costs” approach has led to significant political victories for Erdogan, consolidating his mandate with re-election in the last presidential and parliamentary elections.

However, the path to a more stable economy is not without obstacles.
Recent events, including significant changes in the country’s economic leadership and a revised monetary policy, along with the devastating consequences of two severe earthquakes, pose crucial economic challenges for Turkey in the near future.

Amundi MSCI Turkey UCITS ETF Acc

The Amundi MSCI Turkey UCITS ETF Acc offers a unique opportunity to invest in the Turkish stock market, which has shown remarkable growth despite global and internal economic challenges.
The ETF manages assets of approximately 65 million euros and is characterized by its synthetic replication structure through unfunded swaps.
Launched on August 11, 2006, and domiciled in Luxembourg, it positions itself as a fairly cost-effective choice for investors, with a medium/low total expense ratio (TER) of 0.45%.

Performance and Distribution

The Amundi MSCI Turkey UCITS ETF Acc presents itself as an attractive investment vehicle, reflecting the dynamics of an expanding Turkish economy.
The fund has recorded impressive returns, with an increase of 28.48% in the current year alone and a consistent growth since its launch in 2006, accumulating +54.38%.
These numbers not only reflect resilience but also the growth potential of the Turkish market, despite the economic and political challenges faced by the country.

The fund’s distribution policy is based on accumulation, a strategy that automatically reinvests dividends generated from equity holdings.
This approach is particularly advantageous for long-term investors seeking to benefit from the compounding effect.
Through accumulation, the ETF aims to maximize capital growth over time, avoiding distractions and costs potentially associated with frequent distributions.

Risk Profile

Investing in emerging markets such as Turkey involves a higher degree of volatility and risk compared to more mature markets.
The Amundi MSCI Turkey UCITS ETF Acc is no exception, with an annual volatility of 32.53%.
This level of volatility reflects the economic and political instability that can influence the Turkish stock market, including changes in monetary policy, geopolitical tensions, and significant variations in domestic economic policies.

Despite its high volatility, the fund has shown an ability to manage these risks, offering compensatory returns to investors.
The risk-return ratio, which measures the return adjusted for risk, shows values of 0.80, 0.81, and 0.33 for one, three, and five years, respectively.
These numbers indicate that, despite its high volatility, the fund has been able to offer satisfactory returns relative to the risk taken by investors.

In conclusion, the Amundi MSCI Turkey UCITS ETF Acc provides a balance between high growth potential and significant risk, suitable for investors with a good tolerance for volatility and a long-term investment horizon, who can capitalize on market fluctuations and benefit from the growth potential of the Turkish market.
The ETF is listed on Borsa Italiana and other significant markets, offering easy accessibility to international investors.

Disclaimer: The information and considerations contained in this article should not be used as the sole and primary basis on which to make investment decisions.
The reader maintains full freedom in their investment choices and full responsibility for making them, as only they know their risk tolerance and time horizon.
The information provided in the article is for informational purposes only and its disclosure does not constitute an offer or solicitation to the public for savings.