Borsa Istanbul replaces over quarter of main index amid fund fallout
Borsa Istanbul will replace more than a quarter of the constituents of its benchmark BIST-100 index, its biggest reshuffle since new market structure rules were announced six years ago, following a regulatory crackdown on investment funds. The exchange did not provide a reason for the reshuffle, which will take effect in October. Turkey's Capital Markets Board introduced concentration limits for hedge funds following last week's steep selloff that came after new rules created liquidity pressure at investment funds. Factoring company Destek Finans and financing firm Katilimevim will leave the
GDANSK, Sept 22 (Reuters) — Borsa Istanbul will replace more than a quarter of the constituents of its benchmark BIST-100 index, its biggest reshuffle since it announced new market structure rules six years ago, following a regulatory crackdown on investment funds, the exchange said on Tuesday. The exchange did not provide a reason for the reshuffle, which will take effect in October. Turkey's Capital Markets Board introduced concentration limits for hedge funds following last week's steep selloff that came after new rules created liquidity pressure at investment funds.
Regulators have recently updated how they calculate free-float rates, which left out some fund holdings too. Factoring company Destek Finans and financing firm Katilimevim will leave the BIST-100, while conglomerate Anadolu Grubu Holding and fast-food retailer TAB Gida will return after being removed in the previous period, the exchange said. Esenboga Elektrik, Isiklar Enerji Yapi Holding and Odine Teknoloji, which joined the BIST-100 in the previous quarterly reshuffle, will also be removed. Destek Finans will also exit from the BIST-30 for TR Anadolu Metal.
BIST-30 companies are exempt from the new concentration limits, and a stock's removal will require funds to reduce their holdings. 4% so far this week after plunging about 8% last week. As part of authorities' intervention to shore up market stability, the Capital Markets Board mandated Isbank and Ziraat Bank to oversee the liquidation of 131 investment funds managed by seven portfolio management companies, including Tera Portfoy, Pusula Portfoy and Hedef Portfoy, on the TEFAS electronic fund trading platform. These funds hold large positions in stocks such as Destek Finans that are being removed from the indexes.
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