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Individual Portfolio Management;

 

Individual Portfolio Management is a private portfolio management service offered to individuals and institutions to manage their savings by expert portfolio managers in the capacity of a proxy in accordance with management criteria to be determined by investors, like benchmark, portfolio distribution composition, financial products, and transactions that can be included in the portfolio.

 

A IPM service is offered to qualified investors with a portfolio size of 1 million TL or above through the “Framework Agreement for Personal Portfolio Management” signed between investors and Halk Invest.

 

IPM service is priced   with a management fee (on the basis of the  total portfolio size) and performance commission (on the basis of the benchmark).

 

 

CLICK FOR INTRODUCTORY PRESENTATION

 

 

The IPM service process basically takes place through the steps below:

• First, all criteria  like investment targets, risks that can be taken, financial assets wanted and not wanted to be included in the portfolio, benchmarks with which our investors can compare portfolio performance, and all fees and commissions are set out in the agreement in detail.

• Subsequently, portfolio managers start the portfolio management process according to the criteria specified in the contract and the asset distributions determined based on research and quantitative analysis are applied for the respective portfolio.

Later on, the performance of the portfolio is monitored instantly and all position changes and revisions required by market conditions are conducted as soon as possible by portfolio managers.


 
 
 

We can summarize the IPM process with the following chart:

Creation of Investment Strategies

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Application of Strategies and Performance Monitoring

Reporting

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Assessment and Required Revisions

 

THINGS TO KNOW

Eligibility Test: In order for an Individual Portfolio Management service to start, investors must first fill in the "eligibility test" enclosed to our contract, in accordance with the Capital Markets Board (CMB) legislation. The eligibility test includes a short assessment of whether the service to be provided and your investment objectives, financial situation, knowledge, and experience are compatible, or not, via a short test.

Benchmark: An Individual Portfolio Management service is provided based on a benchmark against which you will compare the performance of your assets managed by our expert portfolio managers. For example, “100% BIST 100 Index” can be accepted as a benchmark for a portfolio with high risky asset weight and preferred to be managed with the share certificates of companies intensely traded on Borsa Istanbul and “100% BIST-KYD 1-month Indicator TL deposit index” can be accepted as a benchmark for a portfolio managed with a target of returns that are above the average market deposit ratios by taking lower risks.
 
 In addition, indicators like CBRT Dollar/TL Foreign Currency Purchase Rate, Government Domestic Debt Securities (GDDS) indices, profit share indices etc. can also be used as benchmarks. It is not mandatory for a portfolio to have a single benchmark. For example, a composite benchmark like 75% BIST 100 Index + 25% BIST-KYD Repo (Net) Index can also be used.

Performance Period: It means the period in which the success of the Individual Portfolio Management service will be measured.

Pricing: The following fees are collected within the scope of the Individual Portfolio Management service.

• Management Fee: It is the fee calculated daily over the total portfolio size but collected monthly.

• Performance Commission (Success Premium): In the event that the portfolio performance is above the benchmark, it is the success premium collected at the end of the performance period, calculated as a percentage of the difference determined by the contract.

• Transaction Fees and Commissions: They are the transaction commissions taking place due to the capital market transactions conducted in the portfolio. As the main purpose in portfolio management is to create performance and receive a success premium, transaction commissions are tried to be kept at the lowest possible levels.

• Custody Commission: It is the portfolio custody commission granted to the custodian entity.

 

SAMPLE PORTFOLIO STRUCTURES

We share some portfolio structures exemplified with the focus on different asset classes. These portfolios or alternative portfolio structures that may be a mixture of them may be subject to a Individual Portfolio Management service.

• Stock Certificate Weighted Portfolio (High Risk): It may be preferred by investors who want their savings to be utilized in stock markets. It may be Benchmark = 50% BIST 100 Index + 50% BIST-KYD Repo (Net) Index.

• Deposit and SGMK (Fixed Income Securities) Weighted Portfolios (Low Risk): It may be preferred by investors wanting their savings to be utilized in assets from which interest income is received. It may be Benchmark = 50% BIST-KYD 547-day termed DIBS Index + 50% BIST-KYD 1-Month Indicator TL Deposit Index.

• Participation Accounts and Lease Certificates (Sukuk) Weighted Portfolios (Low Risk): It can be preferred by investors wanting their savings to be evaluated in assets that obtain dividend revenue. It may be Benchmark = 75% KYD Public Lease Certificates Index + 25% KYD 1-Month Indicator TL Dividend Index. Note: Stocks in BIST Participation indices may also be included in these portfolios at a certain proportion.

• Currency-Based Product Weighted Portfolios: It is possible to invest in foreign currency-based products within the scope of Individual Portfolio Management. Investors wanting their savings to be evaluated in foreign currency assets, with the weight on Dollar and Euro, may receive Individual Portfolio Management services that include various risk groups (stock certificates, eurobonds, DTH, foreign securities investment funds, etc.). It may be Benchmark = 100% BIST-KYD 1-Month Indicator Deposit USD Index.

 

Individual Portfolio Management: Bpy@halkyatirim.com.tr