CMB's New Fund Regulation: Risk of Shift in 2.5 Trillion Lira Resource

CMB Prepares Comprehensive Regulation for the Fund Sector The Capital Markets Board (CMB) has presented a comprehensive draft regulation to the public, aiming to increase transparency and minimize risks within the investment fund ecosystem.
These changes, which specifically target hedge funds and money market funds, have sparked a wide-ranging debate within the industry.
The draft redefines many critical aspects, from the structural operations of funds to portfolio limitations.
Preventing Single-Stock Concentration Risks One of the primary objectives of the draft is to eliminate market risks created by hedge funds structured around a single stock.
Onur Duygu, founder of FonTurkey, stated that fund contents will be diversified in the new period, and the ability of institutions to invest in their own shares will be restricted.
This step is expected to prevent attempts to manipulate the prices of specific stocks using fund resources and to protect the investor base.
A New Era for Money Market Funds Under the current system, some brokerage houses fund their own hedge funds at high interest rates through money market funds (PPF).
The new regulation brings this under supervision.
With the introduction of Takasbank collateral and notification requirements, the goal is to bring PPF returns in line with market norms.
It is anticipated that this situation will make the internal funding mechanisms of funds more transparent and eliminate unfair return advantages.
Volatility Concerns Over 2.5 Trillion Lira Resource The most controversial article in the draft is the mandatory requirement for short-term and hedge money market funds to purchase government debt securities (bonds).
Sector representatives argue that outflows could occur from these funds, which have a total size of approximately 2.5 trillion TL, due to the risk of bond-related volatility.
Experts suggest that institutional investors might turn to deposits or foreign currency to avoid potential negative returns.
Economists and fund managers state that it would be fairer to conduct audits on a transaction basis rather than through general restrictions.
Furthermore, it is emphasized that the "hedge fund" nature of structures with specific strategies, such as arbitrage funds, should be preserved.
Industry stakeholders can submit their opinions and suggestions regarding the draft to the CMB until February 26.