The largest exchange-traded fund to track Turkey’s equity market has tumbled in recent trading, but it has also seen an influx of investors attempting to play the troubled region, according to recent data.
The iShares MSCI Turkey ETF TUR, -0.51% a popular way for investors to get exposure to the country, had inflows of $90.4 million on Tuesday, according to FactSet. That represents the single-largest day of inflows since June 20, 2013.
An unusually large amount of money has flowed into ETF in recent sessions. On Monday, more than $50 million flowed into the fund, bringing its inflows over the past week to more than $160 million—accounting for more than half the nearly $300-million fund’s overall assets.
The inflows aren’t just high for this fund, but stand as being notably high overall. Only 12 other ETF categories have higher inflows over the past week; the iShares fund is the only ETF that FactSet places into the “Turkey – total market” category.
Inflows aren’t necessarily a sign that investors are betting the fund will rise, as they can also represent short positions, or bets that it will fall in price. Thus far in August, the fund has shed a quarter of its value, and it has tumbled more than 50% thus far this year.
Those swings have corresponded with a surge in trading volume. Over the past 30 sessions, it has averaged daily volume of nearly 1.8 million shares.
Midway through August, more than 14.3 million shares have already traded over the course of the month. Over the course of 2017, the fund had average monthly volume of less than 7.5 million shares. Last August, fewer than 3.8 million shares exchanged hands over the entire month.
The losses have tracked similarly steep declines in the Turkish lira USDTRY, +0.0000% against major currencies including the dollar. Both the country’s currency and equity market have been underpinned by worries about the leadership of President Recep Tayyip Erdogan, who has challenged the independence of the country’s central bank after winning a snap election to retain power back in June.
Trade uncertainty has also pressured the country. Last week, U.S. President Donald Trump authorized the doubling of steel and aluminum tariffs on Turkey; the country retaliated with new tariffs of its own on Wednesday.
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