This article was originally published on ETFTrends.com.
The often controversial iShares MSCI Turkey ETF (TUR) is modestly higher to start 2018. If previous seasonal trends hold true to form, the lone Turkey exchange traded fund could be in for more near-term upside.
Last year, Turkish voters voted to disband the country’s parliamentary system and install a strong presidential form of government. That scenario, among others, contributed to strained diplomatic relations between the U.S. and Turkey.
The $380.7 million TUR follows the MSCI Turkey Investable Market Index and holds nearly 70 stocks. TUR charges 0.59% per year, or $59 on a $10,000 investment.
TUR “had a rough fourth quarter, shaken up by Turkey's deteriorating relations with the U.S. and the high-profile trial of Turkish banker Mehmet Hakan Atilla,” reports Schaeffer's Investment Research. “By late last month, however, the ETF had clawed its way back to within inches of annual-high territory, peaking just north of $46 -- a familiar area of resistance -- before retreating with the broader stock market. TUR was last seen 1.1% higher on the day, trading at $44.43.”
Like many single-country emerging markets ETFs, TUR is heavily dependent on the financial services sector. That sector represents 35% of the ETF's weight, more than double its second-largest sector weight. Industrial and materials stocks combine for over 30% of the fund's roster. TUR has a 10.4% weight to consumer staples stocks.
“TUR's upcoming two-month stretch is the best of all four ETFs discussed today, historically. The shares have averaged a March gain of 7.6%, since inception -- another rally of that magnitude would place them around $47.81 -- a neighborhood not charted since mid-2015. What's more, TUR averages an even healthier gain of 8.6% in April. That would put the fund around $51.92, if history repeats -- a three-year high,” according to Schaeffer's.
TUR has a three-year standard deviation of 25%, which is well above the same metric on the MSCI Emerging Markets Index.
For more information on the Turkish markets, visit our Turkey category.
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