Türkiye considers easing short-selling ban to boost foreign investment

Türkiye is considering lifting its ban on short-selling equities to draw more foreign investment, a move seen as crucial for stabilizing the economy, according to Bloomberg.

Details

• Current status: The ban on short-selling was implemented after the devastating earthquakes in early 2023.
• Market performance: The Borsa Istanbul 100 index has increased by approximately 18% this year, although it recently entered a bear market.
• Foreign investment concerns: Fund managers argue that the ban complicates risk management and hinders foreign inflows. Currently, the total value of Turkish stocks held by non-residents has fallen to about $31 billion, down from $42.3 billion in May.

What’s next?

Discussions are ongoing, but specific details regarding the easing of the ban have not yet been finalized. The Capital Markets Board (SPK) has not provided any comments on the potential changes.

Bottom line

Lifting the ban could enhance investor confidence and attract essential foreign capital to Türkiye’s markets.