Developments around Pusula Portföy and Pusula Finans Holding require a fresh look at the relationship between the size of investment funds and the liquidity of the markets in which they invest. Growth in a fund is, in itself, a favourable development insofar as it brings a larger volume of savings under professional management. If, however, the growing fund’s holdings become concentrated in particular shares to an extent that they cannot readily be turned into cash when required, size itself can become a source of fragility.
It is therefore not enough to assess the matter solely through funds’ returns or the amount of money they manage. What must be examined is how quickly, and at what price cost, a fund can meet investors’ requests when they ask for their money back. The Pusula case makes the importance of this question for Türkiye’s capital markets visible.
Public allegations and legal proceedings should be kept separate from the analysis of financial risk. High portfolio concentration is not, by itself, proof of manipulation or of a breach of law. The purpose of this assessment is to explain, on the basis of company disclosures and the relevant rules, the possible effects of concentration on liquidity and on price formation.
The cash need behind fund size
According to Pusula Portföy’s statement that became public on 2 September 2026, the combined size of its two funds open to investors through TEFAS fell from about 115 billion TL to below 8 billion TL, and about 107 billion TL was paid out in the process. The company described the development as a “planned simplification and rebalancing” and stated that its obligations had been met on time.
The financial significance of these figures is that fund size can change substantially in a short period. A decline in fund value and a payment to investors are not, however, the same concept. A fund’s total value is affected both by inflows and outflows of money and by changes in the prices of the assets in the portfolio. The causes of the contraction therefore need to be examined separately.
When investors redeem fund units and ask for their money back, a cash need arises in the fund. If the fund’s existing cash and readily saleable assets are sufficient, that need is easier to meet. If they are not, other holdings have to be sold. At that point, how saleable the portfolio is becomes as important as how valuable it is.
Large holdings in shares with limited trading volume can cause a sale to push the price down. As the fund sells in order to raise cash, the value of its remaining position in the same share also falls. This is a general financial-risk mechanism. The extent to which it materialised in the Pusula case can be established from fund-level transaction data.
Diversification and liquidity should be assessed together
Diversification is one of the basic principles of portfolio management. Spreading investments across different assets can reduce risks that depend on a single company or sector. Diversification is not measured, however, only by how many different shares have been bought; the weights of the holdings and the tendency of their returns to move together also matter. Moreover, the fact that different shares have been purchased does not show that they can be sold easily when required.
Liquidity risk is the risk that an investment cannot be turned into cash in a short time without a material loss of price. One of the determining factors is the size of the holding relative to the market’s trading capacity. The same share may be easy to sell for a small investor and difficult to exit for a large fund.
For example, a position that is 5% of a 100 billion TL fund is worth 5 billion TL. A weight that looks limited in percentage terms may be very large relative to the share’s daily trading volume. The position’s ratio to average daily volume, the size of existing buy orders and the estimated time needed to sell should therefore be examined together. Nor should it be assumed that the whole of daily volume is ready demand able to absorb the fund’s sales.
Mark-to-market value, calculated at the current market price, does not by itself show this distinction. Multiplying the shares a fund holds by the last market price gives the portfolio’s calculated value. If all of those shares were offered for sale, however, sufficient buyers might not be found at the same price. A gap can therefore open between calculated market value and the cash that could actually be realised from a sale.
According to the KAP disclosure, the combined stake of Pusula Portföy funds in ODINE’s capital rose to 10.4686% after transactions on 18 May 2026. For GUNDG, the combined capital stake disclosed after transactions on 18 August 2026 was 38.6699%, and the voting rights 20.1083%. These ratios show why funds under the same manager should be considered together when the effect of possible sales is assessed.
Why free float matters
Not all of a company’s shares circulate on the exchange. Some holdings of controlling shareholders or strategic investors may lie outside the free float. A company’s total capital and the quantity of shares circulating in the market are therefore different. It also cannot be said that a free-float share will be offered for sale at any moment, or that an equal quantity of buyers will be found.
Suppose, for example, that 80 million of a company’s 100 million shares are outside the free float. The circulating quantity is then 20 million shares and the free-float ratio is 20%. A fund holding 10 million shares owns 10% of total capital. If all of the fund’s shares fall within the free float, the same holding corresponds to 50% of the circulating shares. The ratio measured against total capital does not, by itself, show the scale of concentration in the market.
KAP information reports GUNDG’s free-float ratio as about 15.75%. This ratio should not, however, be compared directly with ownership ratios disclosed on different dates. A sound assessment requires the dates of the data, the character of the shares and the scope of the free float to be checked together. A low free float is an important liquidity indicator; it is not, by itself, a complete measure of liquidity.
A cycle that feeds a rise can turn into selling pressure
As new money enters funds and purchases in the same shares continue, the price increase is supported. Rising prices feed into the fund’s return; apparently strong performance attracts new investors. Fund size and the share price thus form a mutually reinforcing process.
The same process can also work in reverse. Investor redemptions create a need to sell; sales push the price down. The fall in price reduces the fund’s unit value. If that decline triggers further redemptions, the fund may have to sell still more. A problem that first appears as one fund’s cash need can then spread to other funds and investors that hold the same shares.
In the finance literature this spillover is explained by the concept of a “fire-sale externality”, that is, the external effect created by forced sales. Investors who are not themselves selling also bear the price effect of large sales made to meet a cash need. A fund’s liquidity management is therefore not a matter that concerns only its own investors; under certain conditions it also matters for the market as a whole.
Related-party investments and the independence of decisions
Fifty per cent of Pusula Portföy’s capital belongs to Pusula Finans Holding. In Katılımevim’s financial reports, Pusula Finans Holding, Pusula Portföy and various group companies are also shown among related parties.
It is ordinary for different financial activities to be conducted within the same economic group. A related-party connection does not, by itself, mean impropriety. Where, however, the interests of fund investors may diverge from those of the group or of the managers, the independence of investment decisions should be examined more carefully.
What matters is whether an investment is justified in line with fund investors’ risk and return expectations. Large holdings in economically connected companies require the documentation of decision processes and the effective management of conflicts of interest. The purpose of the regulatory approach is not confined to intervening after a loss has appeared; it is also to reduce this risk in advance.
The financial meaning of the CMB rules
The Capital Markets Board (CMB) rules of 28 August 2026 address two distinct forms of concentration in hedge funds together. The first is the extent to which a fund’s portfolio depends on particular investments. The second is how large a share of a company’s circulating shares the funds hold.
As regards concentration inside the portfolio, a 20% limit is set on the combined weight of capital-market instruments that each, on its own, exceed 5% of fund portfolio value. There is also a 20% limit on the total of investments in issuers under the management control of the manager or of senior management. These two limits aim to reduce concentration in large holdings and the risk of conflicts of interest from different angles.
In companies whose free-float ratio is below 25%, the stake a single hedge fund may hold is limited to 8% of the free-float shares, and the combined holdings of funds under the same manager to 16%. In higher free-float bands these percentages fall. If, for example, the free-float ratio is 20%, the limit for a single fund is 1.6% of total capital and for funds under the same manager 3.2%. The calculation is made by multiplying 20% by 8% and 16% respectively.
The inclusion of hedge funds in the control that limits funds under the same manager from holding more than 20% of a company’s capital or voting rights treats ownership and control concentration separately. This limit should be assessed apart from the free-float-based limits.
The economic rationale of the rule can be seen in a concrete example. A 3 billion TL holding in a 100 billion TL fund is only 3% of the portfolio. The same amount may nevertheless represent a large part of the circulating shares of a small company with a low free float. Looking only at the weight inside the fund is therefore not sufficient for assessing the effect on the market.
The short-term effect of compliance with the new limits
Rules that reduce concentration can, over the longer term, support a more resilient market structure. Adapting existing holdings to the new limits may, however, create a need to sell in the short term. How the transition is managed is therefore as important as the purpose of the rule.
According to the announced transition timetable, positions that exceed the limits as of 29 August 2026 may not be increased; excesses are to be reduced through interim stages at the end of October and November, with full compliance by 31 December 2026. The provisions that allow changes to the terms of unit redemptions are also directed at managing the fund’s payment conditions together with portfolio liquidity.
When Pusula’s contraction at the beginning of September is examined, the possibility of compliance with the new rules should be considered alongside investor redemptions. The company’s statement that a rebalancing would take place in the sector points to this possibility. The statement does not, however, show that all sales arose from the regulation. Establishing that requires each fund’s inflows and outflows, its sales and its position relative to the limits to be examined.
Looking at fund performance in a wider frame
How much a fund has returned in the past matters. For the investor, however, sustainable performance also includes the conditions under which the money can be taken back when required. Position concentration, free float, the size of the holding relative to daily volume, the structure of the investor base, redemption periods and related-party investments should therefore be assessed together.
That is also the basic question of stress tests: if a large investor outflow occurs, which assets can be sold, in how many days and with how much loss of price? Liquidity that appears adequate in ordinary times may prove insufficient when many investors ask for cash at once. As a fund grows, this question needs to be answered regularly and with concrete data.
Tera Group’s statement that agreement has been reached on the principal terms of talks to acquire Pusula Finans Holding and its affiliates is a new stage in the corporate dimension of the process. An agreement that remains subject to the necessary approvals does not, however, mean that the transfer has been completed. Even if a change of ownership takes place, the question of consistency between fund size and market liquidity retains its importance.
The deepening of Türkiye’s capital markets requires not only that more savings flow into funds, but also that those savings be managed inside a sound market structure. A wide free float, liquid shares, independent investment decisions and effective conflict-of-interest management are the basic elements of that structure. The success of fund size should be judged not only by the increase in assets under management, but also by whether that amount is consistent with the actual trading capacity of the market in which it is invested.
References
- Capital Markets Board of Türkiye (CMB), press announcement of 28 August 2026 and update to the Guide on Investment Funds. CMB press announcement
- Capital Markets Board of Türkiye (CMB), Guide on Investment Funds. CMB Guide
- Public Disclosure Platform (KAP), company information for Pusula Portföy Yönetimi A.Ş. KAP company information
- Public Disclosure Platform (KAP), company information for Gündoğdu Gıda Süt Ürünleri Sanayi ve Dış Ticaret A.Ş. KAP GUNDG information
- Public Disclosure Platform (KAP), material disclosure of 18 August 2026 on Pusula Portföy’s GUNDG shares. KAP disclosure 1652894
- Public Disclosure Platform (KAP), material disclosure of 18 May 2026 on Pusula Portföy’s ODINE shares. KAP disclosure 1609069
- Public Disclosure Platform (KAP), disclosure on Tera Group’s talks to acquire Pusula Finans Holding and its affiliates. KAP disclosure 1661633
- CNBC-e, report on Pusula Portföy’s fund simplification and payments to investors. CNBC-e report
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