Turkey’s investment fund sector experienced a sharp test in September 2026 after redemption difficulties at Pusula Portföy developed into broader selling across parts of the market. The resulting pressure reached Borsa Istanbul, prompted intervention from regulators and brought the structure of certain investment funds under closer examination.
The events were primarily a liquidity and concentration problem involving a specific group of funds, managers, and thinly traded shares. For investors, it provides a timely lesson. An investment can appear liquid on paper while the assets supporting it are difficult to sell at short notice. When too many investors request their money simultaneously, that mismatch can rapidly become visible.
It also explains why Property Turkey has consistently focused on real estate and carefully structured property-related investments. A Titled and independently valued asset does not eliminate investment risk, but it gives investors something identifiable, measurable, and capable of being examined before capital is committed.
What Happened in Turkey’s Investment Fund Market?
Pressure became public between September 15 and 17 after Pusula Portföy said it could not complete certain investor redemptions on time. Pusula was connected to a wider proposed transaction under which Tera Group had agreed to acquire Pusula Finans, including its portfolio management operation, subject to regulatory approval.
The missed redemptions did not mean that Pusula was bankrupt. They indicated that some funds could not generate sufficient cash quickly enough to satisfy investors requesting their money. Investors withdrew as much as $1 billion USD from Turkish investment funds in a single day. Pusula reportedly managed $13 billion USD at the end of August, while Pusula and Tera together managed about $27 billion USD.
The withdrawals placed additional pressure on funds holding shares with relatively limited market liquidity. Managers needing cash had to sell available positions, including more liquid holdings, while falling prices encouraged further investors to redeem their units. This created the conditions for what analysts described as a “fund run”:
- Investors request withdrawals after becoming concerned about a fund.
- The manager needs cash to complete those redemptions.
- Illiquid holdings cannot be sold quickly without accepting lower prices.
- The manager sells more liquid assets instead.
- Market prices fall as selling accelerates.
- More investors become concerned and submit redemption requests.
- The cycle places further pressure on both the fund and the wider market.
The BIST 100 fell by more than 5% on September 16 and triggered a market-wide circuit breaker. By the following day, it had recovered 2.6% following the authorities’ intervention, although it remained 6.9% lower for the week. Reuters described this as the index’s weakest weekly performance since March 19, 2025.
The banking index subsequently rose by 8% during the September 17 session. This suggested that investors were beginning to distinguish between difficulties at specific non-bank investment funds and the overall health of Turkey’s wider banking system.
How Regulators Responded to the Liquidity Pressure
Turkey’s Capital Markets Board, known as the SPK, responded by suspending purchases and redemptions through TEFAS for funds managed by seven portfolio management companies: Tera, Pusula, Hedef, Atlas, A1, Pardus, and Bulls.
TEFAS is Turkey’s electronic fund trading platform. It enables investors to compare and transact in eligible funds from different portfolio management companies through participating financial institutions.
The SPK also identified 130 funds for liquidation. Importantly, the order applied to the named funds rather than automatically closing the seven companies managing them.
Regulatory Action
What it Meant
TEFAS transactions suspended
Investors could not purchase or redeem affected funds through the platform
130 funds designated for liquidation
Assets would be sold and proceeds returned under a process determined by the regulator
Margin requirement reduced
The minimum equity maintenance ratio fell from 35% to 20% until October 2
Trading restrictions imposed
Named parties were prevented from trading on Borsa Istanbul for two years
Criminal complaints filed
Prosecutors were asked to investigate alleged manipulation involving three listed companies
Additional market liquidity provided
The Central Bank increased repo funding and interbank borrowing capacity
The funds designated for liquidation held 891 billion Turkish Lira, equivalent to around $21.4 billion USD, on behalf of about 353,000 investors. Liquidating a fund normally involves closing it, selling its assets, settling liabilities, and distributing the remaining proceeds among unit holders.
To reduce pressure elsewhere in the market, the SPK temporarily lowered the minimum equity maintenance requirement for margin trading from 35% to 20%. Brokerage companies could apply the lower level according to their own risk policies until October 2.
The Central Bank of the Republic of Turkey also increased repo funding to 300 billion Turkish Lira and raised interbank borrowing limits. This supplied additional short-term liquidity and helped reduce the risk that difficulties in one part of the investment sector would create pressure elsewhere.
Why Did the Affected Funds Encounter Difficulties?
The immediate problem was not simply that share prices fell. The weakness was a mismatch between the liquidity offered to investors and the liquidity of some assets held inside the funds.
A fund may allow investors to request redemption within a short period. However, if a significant proportion of its portfolio consists of shares that trade in limited volumes, the manager may be unable to sell enough of those positions without affecting their price.
The difficulties followed new SPK rules introduced during August 2026. These regulations strengthened portfolio diversification requirements and restricted how much free funds could hold in individual listed companies, especially those with limited free floats. Among the changes:
- Listed-share holdings became subject to limits linked to each company’s free-float ratio.
- Individual funds faced ownership limits ranging from 2% to 8% of an issuer’s freely traded shares.
- Combined funds operated by the same manager faced limits ranging from 4% to 16%.
- Investments in securities representing more than 5% of a fund were collectively restricted.
- Holdings involving issuers connected to managers, executives, or investors became subject to tighter limits.
- Larger investment decisions required additional approval and documentation.
- Portfolio management companies faced stronger staffing and capital requirements.
These rules were designed to improve diversification, governance, and investor protection. However, funds with concentrated exposure to thinly traded shares faced the challenge of bringing their portfolios into compliance while investors were simultaneously requesting redemptions.
A Test for Regulation Rather than a Rejection of Funds
The SPK identified concentration risks, introduced stricter rules, suspended transactions when liquidity pressure increased, and established a process for winding down affected funds. The Central Bank then provided additional liquidity to prevent isolated difficulties from spreading.
Effective regulation cannot guarantee that an investment will perform well or that a fund will never encounter difficulties. Its purpose is to establish rules, require disclosure, investigate potential misconduct, and provide an orderly response when problems appear.
Global conditions added another layer of pressure. On September 16, the US Federal Reserve raised its target interest-rate range by 0.25 percentage points to between 3.75% and 4%. Higher US rates can make Dollar assets more attractive and place pressure on emerging markets by increasing funding costs and encouraging international capital to move towards the United States.
The combination of domestic fund redemptions, tighter global monetary conditions, and questions about market classification made the timing particularly sensitive. However, the quick response from Turkey’s financial authorities helped separate the fund-specific problem from the country’s wider economic programme.
Why Real Estate-backed Investment Structures are Different
The lesson is that the structure of an investment should match the nature of the assets supporting it. Daily liquidity may be suitable for a portfolio holding cash, government securities, or heavily traded shares. It becomes more difficult when a fund promises rapid redemptions while holding concentrated positions that cannot be sold in meaningful volumes without moving the market.
- Clearly identified properties or development projects.
- Verifiable Title and ownership records.
- Independent professional valuations.
- Defined investment and exit periods.
- Detailed information about development, planning, and construction.
- Transparent fees and management responsibilities.
- Realistic expectations concerning liquidity.
- Regular reporting on the asset and project.
- A clear explanation of construction, market, and exit risks.
A physical asset does not depend on a quoted share price produced by a limited number of daily transactions. Its value can still rise or fall, but investors can examine its location, legal status, development potential, comparable sales, and expected demand.
Where Funding Turkey Stands
Funding Turkey has no exposure to Pusula, Tera, or any of the other portfolio managers named in the September intervention. Its investment approach is centred on real estate and real estate-related projects, rather than concentrated trading in thinly traded Borsa Istanbul shares.
The structure operates within an SPK-licensed framework and is supported by Titled real estate that is independently valued. Investors are not offered an unrealistic promise that long-term property assets can be redeemed on demand every day.
A real estate-backed investment can align the duration of investor capital with the time required to acquire, develop, manage, and exit the supporting properties. Funding Turkey’s approach is based on several core principles:
- Capital is connected to identifiable real estate.
- Property ownership and Title can be legally verified.
- Assets are independently valued.
- Investment periods reflect the underlying project.
- Liquidity expectations are established in advance.
- Investors are informed about the strategy and associated risks.
- The fund operates within Turkey’s regulated capital-markets framework.
This does not make any investment immune from risk. It does, however, avoid the specific mismatch exposed in September, where investors expected rapid access to cash from funds holding concentrated and comparatively illiquid listed shares.
For Property Turkey, the guiding principle remains straightforward. Investment decisions should begin with the asset, its legal standing, its independently assessed value, and the realistic route through which returns may be generated.
Markets can move within seconds. A carefully selected property cannot promise that kind of liquidity, but it offers something different: an identifiable asset, a defined strategy, and a structure designed around long-term value rather than the assumption that everyone can exit at once.
FAQs: Does this Affect Funding Turkey?
Q: Is Funding Turkey affected by the recent investment fund intervention?
A: No. Funding Turkey has no exposure to Pusula, Tera, or the other portfolio managers named in the September intervention. Its strategy is based on Titled real estate and property-related projects.
Q: Could Funding Turkey face the same type of liquidity problem?
A: Funding Turkey does not promise daily redemption for assets that are naturally held over a longer investment period. Investor capital is aligned with the time required to acquire, develop, manage, and exit the underlying properties.
Q: What supports investments made through Funding Turkey?
A: Funding Turkey investments are connected to identifiable real estate and property-related projects. The supporting assets have legally verifiable Title records and are independently valued.
Q: Is Funding Turkey regulated by the SPK?
A: Funding Turkey operates within an SPK-licensed and regulated framework. This means the investment structure is subject to capital-market rules, reporting requirements, and professional oversight.
Q: Does investing in real estate remove all investment risk?
A: No investment is entirely without risk. Property values can change, construction can be delayed, and an exit may take longer than anticipated. Funding Turkey offers a transparent, asset-backed structure with defined investment periods, independent valuations, and realistic liquidity expectations.
Cameron Deggin Founder & CEO, Property Turkey
Cameron Deggin is Founder and CEO of Property Turkey. A former finance professional and FCCA-qualified accountant, he founded the company in 2001 after recognising Turkey’s investment potential. With more than two decades analysing Turkish real estate, Cameron regularly advises international investors and is quoted by media including the Financial Times and BBC.
By:
Founder & CEO, Property Turkey
Kalkan 
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