How to invest in BIST 100 index funds in 2024

Find out how to invest in the BIST 100 index, learn which trading platforms have the lowest fees, and what’s easiest for beginners.
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Updated: May 12, 2023
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It only takes a few minutes to invest in the BIST 100 index. One of the simplest and most popular ways to invest is to buy shares in a Vanguard BIST 100 ETF through an online trading platform.

Where can I invest in the BIST 100 index?

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According to our expert research, eToro is the best ETF broker to invest in BIST 100 index funds. 

Both BIST 100 ETFs and BIST 100 CFDs are available to invest in through eToro .

Here are three more places to buy the BIST 100, ranked according to their cost, security, and features.

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1
$ 10
Best offer
10
Up to $240 bonus!
Deposit with ACA, Wire, Pay with my bank
Invest for dividends and get payout on stocks on Ex-Dividend day
:
Bank Transfer, Credit Card, Debit Card, PayPal, Wire Transfer
:
CySEC, FCA

eToro offers real assets only, no CFD products. eToro securities trading offered by eToro USA Securities, Inc. (‘the BD”), member of FINRA and SIPC. Investing involves risk, and content is provided for educational purposes only, does not imply a recommendation, and is not a guarantee of future performance. Invezz.com is not an affiliate and may be compensated if you access certain products or services offered by the BD.

2
$ 100
Best offer
9.9
Trade +2000 CFDs on Shares, Options, Commodities & more
Unlimited risk-free Demo Account
0 commissions & attractive spreads with up to 1:5 leverage
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American Express, Apple Pay, Bank Transfer, Credit Card, Debit Card, Discover, Google Pay, Mastercard, PayPal, SEPA, Trustly, Visa, , skrill
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ASIC, FCA, FSA, MAS, cysec-250-14-regulator, isa-regulator

Buy or sell stock CFDs with Plus500. 82% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

3
$ 0
Best offer
9.7
Diverse stock selection providing investors with a diverse array of options for their portfolios.
Advanced trading tools aiding in executing trades with precision in the dynamic stock market.
Easy portfolio management.
:
ACH, Bank Wire, Check
:
CFTC, FCA, FINRA, IIROC, NFA, NYSE, SIPC
Interactive Brokers (U.K.) Limited is authorised and regulated by the Financial Conduct Authority. FCA Register Entry Number 208159. Products are only covered by the UK FSCS in limited circumstances.

How do I invest in the XU100 index?

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The easiest way is to sign up to a stock broker, open an investment account, and buy shares in an BIST 100 ETF or CFD. This guide explains how to do it:

Step 1. Sign up to eToro

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We recommend using eToro to invest in BIST 100. Sign up for a brokerage account and deposit some money. You may need to supply a form of photo ID to verify the account.

1
$ 10
Best offer
10
Up to $240 bonus!
Deposit with ACA, Wire, Pay with my bank
Invest for dividends and get payout on stocks on Ex-Dividend day
:
Bank Transfer, Credit Card, Debit Card, PayPal, Wire Transfer
:
CySEC, FCA

eToro offers real assets only, no CFD products. eToro securities trading offered by eToro USA Securities, Inc. (‘the BD”), member of FINRA and SIPC. Investing involves risk, and content is provided for educational purposes only, does not imply a recommendation, and is not a guarantee of future performance. Invezz.com is not an affiliate and may be compensated if you access certain products or services offered by the BD.

Step 2. Decide how to buy BIST 100

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This boils down to choosing between an BIST 100 ETF or CFD. ETFs are generally better suited to investors who want to passively track the BIST 100’s performance. CFDs offer a greater range of trading options: you can use leverage, short the index, or buy and sell it outside of trading hours.

Step 3. Invest in the BIST 100

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Sign into your trading account and search for the BIST 100. Hit the ‘buy’ button and enter the details of your purchase, such as how much you want to spend. Hit ‘buy’ again to execute the trade.

Step 4. Monitor your investment

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When you buy a CFD, the trade goes through more or less instantly, and you’ll be able to see your new open position in your trading account. ETF purchases can take longer, and if you buy outside of traditional trading hours it won’t go through until the next morning.

Your trading account will show the price change in the BIST 100 since you bought it, so you can see your profit/loss at a glance. Use that information, along with your own research, to decide when to sell the BIST 100 and close your position, ideally at a profit!

The different ways to invest in the XU100

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As we mentioned above, there are numerous ways to put your money into the BIST 100. ETFs and CFDs are the simplest options for beginners, but there are alternatives. Here’s a brief overview of each option and who it’s best suited for.

BIST 100 ETFs

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An ETF (exchange-traded fund) is an investment fund traded on a stock exchange, much like a stock. Exchange traded funds can hold different assets, such as individual stocks, bonds, or commodities, or serve as a proxy for a stock market index.

An BIST 100 ETF is one way of investing in the BIST 100. It’s simply an investment fund that mirrors the performance of the BIST 100. When you buy shares in the fund, the value of your investment will rise or fall with the BIST 100 itself. 

ETFs are ideal for new investors because they have a very low minimum investment. You can start with a few pounds and get exposure to some of the world’s largest companies. They’re also practical if you plan on trading the BIST 100 index, because you can buy or sell shares in the fund throughout the day.

Examples of popular XU100 ETFs

  • iShares MSCI Turkey ETF (TUR)
  • Lyxor UCITS ETF Turkey (TUR)
  • Xtrackers MSCI Turkey UCITS ETF (XMTU)

BIST 100 index funds

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An index or mutual fund is an investment fund that aims to track the performance of a stock market index, such as the BIST 100. It’s very similar to an ETF, in that there are low management fees and you can buy shares through your online broker.

However, there are a couple of differences. BIST 100 index funds are only priced at the end of each trading day, so you can buy or sell shares in the fund once per day. There may also be a higher barrier to entry, through a much larger minimum investment when you invest in BIST 100 index funds.

That means an BIST 100 mutual fund is better suited for long term investors with a higher initial budget, where the infrequent trading and barriers to entry are far less of an issue.

Examples of popular XU100 index funds/mutual funds

  • HSBC GIF Turkey Equity Fund
  • BNP Paribas Turkey Equity Fund
  • Fidelity Funds – Turkey Fund

BIST 100 CFDs

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CFDs (contracts for difference) are a way to speculate on BIST 100 price changes with more flexibility than if you use an ETF or index fund. A CFD is a ‘derivative’, which means it gets its value from the underlying asset – in this case the BIST 100 – but it’s separate from it.

As a result, CFDs can be leveraged, where you borrow money to multiply the size of the trade, or they can be used to go ‘short’, where you place a trade on the index to fall in value. You can also buy and sell them outside of regular trading hours.

All of this means BIST 100 CFDs offer the potential to outperform a fund that passively tracks the BIST 100’s performance. Of course, you can also underperform it as well. Tools like leverage and shorting introduce a lot more risk, and are best left to experienced traders.

BIST 100 futures

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Futures contracts are agreements to buy or sell the XU100 at an agreed price on a set date in the future. BIST 100 futures are a means to predict how you think the index is going to perform over a set time frame, such as the next three or six months.

Most futures contracts involve leverage, so you only put up a small part of the total trade value (the margin) when you buy one. That makes futures more risky, and they require a bit more financial expertise to understand as well.

Some traders use futures as a hedge against the performance of stocks they own. For instance, if you own stocks that are part of the BIST 100 then you might want to short the BIST 100 so that you still make some money if the price falls.

BIST 100 stocks

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Another way to invest in the BIST 100 is to buy shares in the individual stocks that the index tracks. It isn’t practical to buy every share in the index, but you can invest directly into a few of the most heavily weighted stocks in the BIST 100 in order to get broad exposure to its performance.

The most heavily weighted stocks in the BIST 100 tend to be the largest companies by market capitalisation. If you invest directly in those largest stocks, you gain exposure to the index without taking on the risk of all the underlying companies.

One reason to do this is that these larger companies with the highest market cap dominate the index anyway, so that it can give you the impression of a diversified portfolio while actually being reliant on the performance of those particular stocks.

For the BIST 100 index, the largest stocks you might choose to invest in are:

CompanyIndex weight
Koç Holding (KCHOL)10.57%
Garanti BBVA (GARAN) 9.69%
Türkiye İş Bankası (ISCTR) 8.87%
Akbank (AKBNK) 7.44%
BİM Birleşik Mağazalar (BIMAS) 4.58%
Ford Otomotiv Sanayi (FROTO) 4.36%
Türk Telekom (TTKOM) 4.27%
Tofaş Oto Fabrika (TOASO) 3.74%
Emlak Konut GMYO (EKGYO) 3.62%
Petkim Petrokimya (PETKM) 3.49%

The flip side of investing directly like this is that you lose the diversification and stability that comes with buying into an entire index. It requires much more hands-on management to do your own stock picking, so it’s best suited to more experienced investors.

How much does it cost to invest in the BIST 100 index?

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From $0 to $5, depending on how you invest. For each option, you must consider the cost of buying the actual asset, whether that’s an ETF, index fund, CFD, or share, plus the fees associated with it.

InstrumentTrading feeManagement fee
Exchange traded funds$0-$5.990-0.2%
Index fund / mutual fund$0-$5.990.1-2%
Individual stock$0-$3None
CFD$0None

*A fee comparison of 3 leading brokers for example purposes

ETFs and CFDs are generally the cheapest option overall, as they have low fees and a low minimum investment. Index funds and mutual funds have low fees but may have a high minimum investment. Buying individual stocks is the most expensive option in absolute terms, because the share price of a single large company is often more than $100.

All options are likely to include a trading fee, which you pay each time you make a transaction. Some trading platforms offer zero-fee trading, with others it may be a few dollars. 

Then ETFs and index funds each have their own expense ratio. Expense ratios refer to an annual management fee, charged as a percentage of your total investment. Expense ratios are usually no more than 0.05%, so if you invest $1,000, you would pay $5 per year in management fees.

Should I invest in the BIST 100 index? 

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Yes, BIST 100 investing is a great choice if you’re looking for a safer investment with more price stability compared to picking individual stocks. It gives you an instantly diverse portfolio with exposure to a broad area of the stock market.

The flip side is that you have less control over which companies you invest in. An index committee decides how the index works, and you can’t pick and choose the underlying companies you like the most. The BIST 100 is better suited to hands-off investors, compared to those who have the skills, experience, and desire to pick their own stocks.

What are the advantages of investing in the BIST 100 index?

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An index provides instant stock market diversification, where you spread your risk across a large number of underlying companies, rather than one or two. Here are some more reasons why you might want to invest in the BIST 100 index:

  • Gain exposure to the Turkish market. Investing in the BIST 100 index exposes investors to some of Turkey’s largest companies. This means you’ll gain exposure to the wider Turkish market and any of its future gains. 
  • It’s a diverse index with a range of sectors. The BIST 100 is comprised of companies from many different sectors and industries. Some of these include finance, telecommunications, energy, and consumer goods. This diversification can help reduce the risk of volatility. 
  • Many of the stocks have attractive valuations. The BIST 100 index includes many companies that may be undervalued. It has a relatively low price-to-earnings ratio which may provide an opportunity for long-term investors. 

What are the disadvantages of investing in the BIST 100 index?

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The main risk of investing in the BIST 100 is that all the underlying companies are related in some way, so a broader economic downturn that affected the entire country would likely affect many stocks in the index at the same time. Here are some more risks of BIST 100 investing.

  • Turkey can be politically unstable. Turkey has experienced political and economic instability in recent years. This has resulted in a volatile stock market which has seen prices fluctuate wildly. Before investing, it’s important to consider the broader political landscape. 
  • There is a risk of currency fluctuations. The Turkish Lira is a volatile currency, and fluctuations in the currency can impact the value of investments valued in the Lira for foreign investors. 
  • Some Turkish companies are not transparent. There have been some concerns about corporate governance and transparency in some Turkish companies. This can create uncertainty for investors. 
Invest in the BIST 100 Index

FAQs

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Prash Raval
Financial Writer
Prash is a financial writer for Invezz covering FX, the stock market and investing. For over a decade he has traded spot FX full time while... read more.