For fund analysis, Turkey's geography presents problems of categorisation. S&P's Micropal can trace funds with Turkish elements in its European sector, in its special Balkan sector and in its Middle Eastern sector.

There are four specialist Turkey funds available.

The Aberdeen Prolific Turkey Opportunities Fund run byRadhika Ajmera is constructed around a number of core holdings that are passively managed and account for 80% of total assets. The balance is actively traded to take advantage of continuing volatility within the market. Ajmera uses research from a panel of domestic brokers supported by regular visits herself. David Edgerly's Turkish Growth Fund is run for Alliance Capital on a purely bottom up basis. He argues that an analysis of the macroeconomic environment is useless as the numbers are always negative for the market. The fund maintains a strong blue chip focus and will typically feature 35 separate positions.

The Global Securities Turkish Smaller Companies Fund can invest up to 10% of its assets in unlisteds. At least 75% will be invested in listed stocks whose market cap places them in the bottom quartile of the total capitalisation of the Istanbul stock exchange. Research is primarily obtained from Global Securities, the largest Turkish stockbroker.

Morgan Stanley's Turkish Investment Fund, listed in New York, has a portfolio made up 60-70% of defensive blue chips with the balance traded in a combination of small cap growth and special situations to take advantage of the extreme volatility experienced in the Turkish market.

Turkish Bank TAIB Yatirim has launched its own mutual funds: the Golden Horn Fund, domiciled in the BVI, and two domestic funds: type A (25% invested in equities at all times in order to become eligible for the tax break) and type B(majority consisting of bond & bills and repos). Richard Newell

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