Turkish stock market sees nearly 1M small investors exit

The Turkish stock market has lost 965,606 small investors during the summer months, primarily because of the significant slowdown in initial public offerings (IPOs).

The number of equity investors dropped from 8.33 million in May to 7.36 million by August 9th.

Market impact

• Despite the exit, the total value of stock portfolios increased from ₺5.84 trillion to ₺5.94 trillion.
• Investors with equity investments ranging from 1,001 to ₺5,000 saw their numbers fall sharply, from ₺2 million in May to ₺1.4 million in July – a reduction of ₺586,000.
• Those with portfolios valued between ₺5,001 and ₺10,000 dropped by ₺101,000 to ₺710,000 over the same period.
• Even the smallest investors, holding stocks worth ₺101 to ₺1,000, saw a decrease of ₺142,000, leaving the group at ₺883,897 by August.

Stock market performance: Since the end of May, the BIST 100 index, Türkiye’s benchmark stock index, fell by 5%, dropping from its peak of over 11,000 points to 9,907 points as of Aug.9.

Decline in IPOs

• The slowdown in IPOs contributed to the decline, with only four companies going public from June to early August – compared to eight in May alone.
• This drop in IPO activity led to reduced market participation, particularly among small investors, who had previously been drawn in by the IPO boom.

Demographics of departing investors

The age distribution of the investors who exited the market is varied:

• 336,000 were in their 20s
• 225,000 were in their 30s
• 132,000 were in their 40s