Tactical Bull View on Turkey ETF

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This idea is suitable for someone who is looking to find value in emerging markets.

On March 27, the cost of borrowing Turkish Lira overnight soared past 1000% as local banks were pressurised to not provide liquidity to foreign fund managers seeking to bet against the Lira. As a result, the Turkish equity markets experienced a massive selloff. The BlackRock Turkey ETF (TUR) slumped 9% last week. Though the economy has been struggling with high double-digit consumer-price inflation, unemployment, an ailing currency and political uncertainty, we believe that these headwinds have been priced into equity valuations currently.

BlackRock Turkey ETF (TUR)’s P/E Ratio has slid to 5.8, with the 12 month trailing yield at roughly 4% and it looks a good ‘Buy’ at these levels. Growth is highly likely to turn positive in late 2019 as major economic data looks promising – strong energy consumption, increasing car registrations, robust exports, tourism and tax revenue along with a large percentage of working age individuals.

Summary: Buy Turkey ETF (TUR)/ Sell Puts on TUR

Please reach out to advisors@kristal.ai for further details/queries – Kristal.AI Advisory Desk.

Disclaimer

The materials and data contained herein are for information only and shall in no event be construed as an offer to purchase or sell or the solicitation of an offer to purchase or sell any securities in any jurisdiction. Kristal Advisors does not make any representation, undertaking, warranty or guarantee as to the update, completeness, correctness, reliability or accuracy of the materials and data herein. All opinions, forecasts or estimation expressed herein are subject to change without prior notice. Kristal Advisors and its affiliates accept no liability or responsibility whatsoever for any direct or consequential loss and/or damages arising out of or in relation to any use of opinions, forecasts, materials and data contained herein or otherwise arising in connection therewith.