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TURKEY:
Two new participation indexes, the Participation 50 Index (KAT50) and
the Participation Model Portfolio Index (KATMP) will be officially
launched today in Turkey. The new indexes, under the sponsorship of
Turkey’s four participation banks Albaraka Turk, Bank Asya, Kuveyt Turk
and Turkiye Finans, join the country’s established Participation 30
Index.
The
new indexes have been published by Borsa Istabul since the beginning of
July 2014, with KATMP closing up at 72,202.18 on the 14th
August and KAT50 closing at 72,525.47, a decrease of 23bps. In order to
meet the international and domestic desire for overseas investment in
Turkey’s stocks that conform to Shariah compliant principles, all three
indexes are open to international investment by foreign investors.
Speaking
exclusively to Islamic Finance news
Avsar Sungurlu, the assistant general manager of index advisor Bizim
Menkul Degerler, outlines the impact of the new indexes on Turkey’s
participation sector: “Since the introduction of the first Participation
30 Index in 2011, we observed a quick acceptance throughout the
industry, because previously there had been no such product that could
be utilized for investment products and services, tailored to both
local and worldwide participation finance customers. Many fund
managers, including pension funds, licensed the index and even the
conventional institutions have started using the index as a benchmark
for their related investments.” These new indexes are a culmination of
three years-worth of experience and Sungurlu is optimistic that the
indexes “will promote new investment funds and other participation
finance products”.
The
Participation 30 and the new Participation 50 Index are comprised of
the top 30 and top 50 stocks respectively, trading on Borsa Istanbul,
which comply with Shariah compliant principles and possess the highest
floating market value. The weight of the stock within the indexes is
based on their market values. The Participation Model Portfolio Index,
which is composed of 13 stocks, from the Participation 50 after the
imposition of various criteria, has been introduced based on perception
of a market need for a product that is actively managed and aims at
returns above the market.
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