Time to buy Turkish stocks?

D

Daal

http://factcheckingturkey.com/economy/claim-turkey-s-corporate-debt-70-cent-its-gdp-459

Corporate and goverment debt levels as a % of GDP are lowish, so it seems that they dont need to print all that much money. TUR is trading at 7-8 times earnings, over 50 stocks are in it, so its diversified. The sanctions arent good but this isnt like North Korea, all they got to do is to release a guy from prison and even if they dont, its not like Trump can rally the entire planet to sanction Turkey due a priest. Turkey is in NATO after all
Time to buy?
 
Daal said:
http://factcheckingturkey.com/economy/claim-turkey-s-corporate-debt-70-cent-its-gdp-459

Corporate and goverment debt levels as a % of GDP are lowish, so it seems that they dont need to print all that much money. TUR is trading at 7-8 times earnings, over 50 stocks are in it, so its diversified. The sanctions arent good but this isnt like North Korea, all they got to do is to release a guy from prison and even if they dont, its not like Trump can rally the entire planet to sanction Turkey due a priest. Turkey is in NATO after all
Time to buy?
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I think a good deal is due to the Lira. Isn't much of their debt in other currencies?
 
Arnie said:
I think a good deal is due to the Lira. Isn't much of their debt in other currencies?
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You are probably right, so this becomes a Soros reflexivity type situation where pessimism leads to default and optimism leads to good times
 
Daal said:
http://factcheckingturkey.com/economy/claim-turkey-s-corporate-debt-70-cent-its-gdp-459

Corporate and goverment debt levels as a % of GDP are lowish, so it seems that they dont need to print all that much money. TUR is trading at 7-8 times earnings, over 50 stocks are in it, so its diversified. The sanctions arent good but this isnt like North Korea, all they got to do is to release a guy from prison and even if they dont, its not like Trump can rally the entire planet to sanction Turkey due a priest. Turkey is in NATO after all
Time to buy?
More...

I don't know your specific timeframe and risk/reward metrics for this trade/investment, but it's important to remember that according to a recent Goldman report, some banks are probably insolvent at current levels. (USD/TRY at about 6.99 at the time of writing). The others might be insolvent if the TRY declines by another 15%.

So while big questions remain about the banks (ie, potential for 90% downside or more), it's hard for me to exited about buying a basket of Turkish stocks.

https://www.ishares.com/us/products/239689/ishares-msci-turkey-etf

Especially if that basket includes quite a few bank stocks.

.
 
m22au said:
I don't know your specific timeframe and risk/reward metrics for this trade/investment, but it's important to remember that according to a recent Goldman report, some banks are probably insolvent at current levels. (USD/TRY at about 6.99 at the time of writing). The others might be insolvent if the TRY declines by another 15%.

So while big questions remain about the banks (ie, potential for 90% downside or more), it's hard for me to exited about buying a basket of Turkish stocks.

https://www.ishares.com/us/products/239689/ishares-msci-turkey-etf

Especially if that basket includes quite a few bank stocks.

.
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Do you have the details of that note? IME during times of panic, its very easy to overestimate these sorts of risks. I certaintly did back in 2009 in the US crisis and many have done in the EU crisis in 2011-2012 as well as in the Brazil turmoil in 2015. Its human nature
 
Daal said:
Do you have the details of that note? IME during times of panic, its very easy to overestimate these sorts of risks. I certaintly did back in 2009 in the US crisis and many have done in the EU crisis in 2011-2012 as well as in the Brazil turmoil in 2015. Its human nature
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Yes you're right it's just an estimation of the risks.

Original post about Goldman note here:
https://www.elitetrader.com/et/threads/turkish-lira-try.320094/page-7#post-4704634

which contains a link to a ZH article about a Goldman note:

"Goldman Warns Turkish Banks Will Be Wiped Out If Lira Hits 7.1"
https://www.zerohedge.com/news/2018...rkish-banks-will-be-wiped-out-if-lira-hits-71

.
 
I don't trade/own stocks so what do I know but if I were to consider Turkish stocks I'd wait for some kind of bottom and initial first move before I'd seriously consider diving in.
 
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