On August 15, 2018, the Capital Markets Board (“CMB”) published an announcement temporarily reducing the leverage ratio from 10:1 to 1:1 for FX market transactions where the Turkish lira (“TRY“) is on one side of the parity. The decision is effective between August 16, 2018 and September 3, 2018.
- To protect investors against the latest FX market fluctuations, the CMB temporarily reduced the leverage ratio from 10:1 to 1:1 for FX market transactions where the TRY is on one side of the parity until September 3, 2018. The reduction seeks to prevent any possible negative effects when FX transactions resume in Turkey following the national holiday of Eid al-Adha (Kurban Bayramı).
- This temporary reduction of leverage will not apply to open positions taken prior to August 16, 2018, or new positions to hedge the open positions.
The CMB’s amendment aims to protect investors against potential risks relating to recent market fluctuations.