HSBC offers a variety of investment services and opportunities. Depending on your specific interests, you will need to have an account with HSBC Bank, HSBC Yatirim, or both.

* Documents Needed for Opening An Investment Account in HSBC Bank and HSBC Yatırım are identification (a certificate of birth, driver’s license or photocopy of passport for real persons of Turkish citizenship, passport or residence permit for real persons of foreign citizenship), income statement (last month's payroll sheet for salaried employees; if the payroll is printed on paper with the firm’s letterhead, the firm’s signature circular is also required; tax statement for the self-employed), trade registry gazette for the self-employed/ business owners, the original electric, water, gas or telephone bills of the home address that appears on the application form (bills should be issued in the applicant's name or to a family member with the same last name).

Bonds and bills are borrowing instruments issued by institutions. The most common ones in Turkey are Treasury Bills and Government Bonds issued by the Undersecretariat of the Treasury to accommodate the central government's financing needs.

Corporations and governments that need to borrow money issue bonds. Corporate bonds usually offer greater returns than do Treasury Bills and Government Bonds in order to balance the greater risk of default.

Nominal value is the amount that the investor will receive upon redemption on the date of maturity for bonds sold at a discount. For bonds with coupon interest, nominal value is the amount used as a base for coupon interest and the amount that the investor will receive together with the last coupon payment on the maturity date.

Coupon rate is the proportion of nominal value to be paid as interest (or as a return on investment). Example: Consider a one-year bond with semiannual coupon payments, a nominal value of TL 1.000,00, and a coupon rate of 50%. This bond will pay TL 250,00 at the end of the first six months and TL 250,00 plus the nominal value of TL 1,00 at the end of the second six months (which is also the maturity date). The coupon rate and the coupon payment schedule are announced at the time of issue.

Maturity is the date that the nominal value is to be redeemed, and the last interest payment made.

To compare Treasury Bills and Government Bonds with other investment instruments, the returns on each should be calculated.

Yes. This product is designed to return your capital in full at maturity. The deterioration of the credit quality, or the bankruptcy, of an issuer can result in the partial or total loss of the capital invested. In the event of the issuer default, you may not receive back the amount of your investment. However, real and expected values of these instruments vary with changes in interest rates in the secondary market up through their maturity dates. When interest rates in the secondary market decrease, the instruments appreciate in value and yield greater returns than otherwise if sold prior to maturity. When interest rates in the secondary market increase, the instruments depreciate in value and yield lower returns than otherwise if sold prior to maturity. Depending on the magnitude of the increase in interest rates, the market value of these instruments may even fall below their initial purchase price.

To participate in Treasury Auctions via HSBC, you need to have an account with us. You can participate through any HSBC Branch by presenting a written order stating the amount and rate that you wish to invest. The order should be registered by 11:00 on the day of the auction.

You can also participate in Treasury Auctions via HSBC Retail Internet Banking. Just look for the "Treasury Auctions" menu.

BASIC CONCEPTIONS and TRANSACTION TERMS 

New – Old Stock Difference: "Old" and "New" stocks are dealt with codes as "E" and "Y" in the secondary stock market. The difference is sourced from: 

If the capital increase of a company, which stocks are dealt in ISE, occurs before the divident payment in a fiscal period, then the new issued stock doesn't carry the dividend coupon of the previous fiscal period so a value difference appears between the stocks that carry the dividend coupon of the previous fiscal period that is called as Old stock and the stocks that don't carry the dividend coupon of the previous fiscal period that is called as New stock. To specify the value difference between these two stocks, the New issued stocks are dealt in a different line with a "Y" code during the starting day of the capital increase till the first day of dividend payments of the old stocks. The terms for the New stocks are:

• The line of New stocks are opened at the same screen with the old stock.
• The line of the stock is opened with a base price if the dividend ratio is determined. If the dividend ratio is not determined, no base price and price margin is applied till the the opening session and price registration. The sessions after the price registration, the base price is calculated over the weighted average price of the transactions dealt at the previous session; the price margin is the same as the margin of the Old stock.
• The New stock, as a separate, is dealt within the same terms and conditions of the secondary market that the Old stock is subject to.

• Customer orders are taken separately for New and Old stocks.
• The orders are transmitted to related stock lines as Old and New.
• The clearing responsibilities are processed separately for Old and New stocks.

Prudent investment decisions require time, dedication, and expertise. The investment process can be especially time-consuming, not to mention confusing, with an abundance of options. The steps and tasks can add up to an enormous burden: Ascertaining the type of investment that best meets your requirements; following daily economic developments; switching instruments when required; following up the asset terms of your portfolio; and calculating the periods for using the first option rights of securities. Mutual funds managed by professionals release investors of the time burden associated with such tedious tasks. They also shift the burden of appraisal from investors to investment experts.

Mutual funds bear risks of varying degrees based on their types. Generally, potentially high returns mean potentially high risks. Therefore, the choice of mutual fund type (A or B) and kind (equity, bonds and bills, liquid, variable, etc.) must match risk and return preferences.

The past performance of a mutual fund is one indicator of its profitability. Data on daily, weekly, monthly, and yearly returns should be examined and compared with returns on alternative investments. Such data are widely available, and are even published in newspapers and magazines.

However, the past performance of a mutual fund cannot be taken as an infallible indicator of its future performance. Daily price and efficiency fluctuations must not influence the choice of mutual funds. Particularly mutual funds heavily invested in equities should be regarded as medium- and long-term instruments of investment.

Detailed information on mutual funds is available at HSBC Branches and through HSBC Telephone Banking (444-0-111).

In accordance with the Mutual Funds Decree of the Capital Markets Board, the founder of the fund appoints a Fund Board including at least one auditor and at least three people to carry out fund-related transactions on behalf of the founder.

A Fund Service Department – consisting of a Fund Accountant and a sufficient number of staff members – operates under the supervision of the Fund Manager who is responsible for ensuring that fund-related transactions are carried out in a sound manner.

When choosing a mutual fund, the following points should be taken into account

• Fund revenues.
• Founder of the Fund.
• Type and kind of funds managed by the founder.
• Most recent portfolio composition of the Fund.
• Portfolio manager managing the Fund portfolio.
• Success of founder according to types of fund managed in the past.
• Success of founder compared to other funds of the same type.
• Places where Fund Participation Certificates can be bought and sold.
• Times when Fund Participation Certificates can be bought and sold.
• Requirement of an advance notice for buying and selling Fund Participation Certificates.

Type-A funds must have at least 25% of their portfolio value dedicated to equities. As such, they can be positively or negatively affected by fluctuations in the stockmarket. Type-B funds are not restricted with respect to the asset composition of their portfolio. In this sense, Type-A funds can be said to be riskier than Type-B funds. Revenue expectations are directly proportional with the risks undertaken.

A Participation Certificate is a valuable paper bearing the rights of the certificate holder before the founder and the custody company. It constitutes legal documentation of shares held in the fund.

Investors are entitled to sell Participation Certificates and collect the revenues whenever they wish. However, provided that it is specified in the fund regulations, some fund founders may apply a notice period of 1 or 2 business days for returns in order to make cash arrangements. In this case, investors are obligated to notify the founder of their transaction requests as many days in advance as specified.

Buying Funds

If you register your purchase request before 13:00 on a business day, fund subscription takes effect on the next business day with the evening price of the notice date. If you give your notice between 13:00 and 24:00, fund subscription becomes effective two business days later with the evening price of the business day immediately following the notice date. This holds for both Type-A and Type-B funds.

During the notice period, an amount equivalent to the value of the fund at the time of notice is reserved and retained in the HSBC Liquid Fund (HSBCL – HSBC Bank Type-B Liquid Fund). The number of shares to be transferred to your account is calculated by adding accrued interest to the amount you deposit when giving the notice.

The HSBC Liquid Fund is not subject to a notice period. Transactions are carried out instantly and at your convenience (7 days & 24 hours). Price changes take effect at 18:00 on business days.

Selling Funds

For Type-A funds, if you issue a sales order before 13:00 on a business day, you effectively divest your holdings two business days later. If you issue a sales order between 13:00 and 24:00, the sale takes effect three business days later with the evening price of the business day immediately following the notice date.

For Type-B funds, if you issue a sales order before 13:00 on a business day, the sale becomes effective on the next business day with the evening price of the notice date. If you issue a sales order between 13:00 and 24:00, the sale takes effect two business days later with the evening price of the business day immediately following the notice date.

The HSBC Liquid Fund is not subject to a notice period. Transactions are carried out instantly and at your convenience (7 days & 24 hours). Price changes take effect at 24:00 on business days.

As buying prices are not definite in the future pricing method, the prices of Participation Certificates are extrapolated by adding 5% margin for A Type Funds and 2% margin for B Type Funds to the most recent selling price. At the time of the transaction, any excess of the margin price over the actual price is transferred to the investor's account. This method applies to both Type-A and Type-B funds.

The total fund value divided by the number of shares in circulation gives the unit price for the Participation Certificate.

However, as portfolio value is based on daily average prices in the stockmarket, the prices of Participation Certificates may not show a one-to-one correspondence with closing prices.

For example, a comprehensive rally of 10% in the last few minutes of the stock exchange session would not produce a comparable increase in the unit price of a Type-A fund consisting entirely of equities. Likewise, a late drop would not significantly influence certificate prices.

All assets in the mutual fund portfolio are appraised at the end of every business day, with the appraisal based on average prices of the markets (index fund closing prices) where the assets are traded. The total fund value is determined through adjustments in line with individual gains and losses on assets constituting the entire portfolio.

Mutual fund returns consist of interest revenues on fixed-income securities (Treasury Bills and Government Bonds), dividend income from equity shares, and profits from trading activities. An increase in the market value of assets comprising the fund would also lead to an increase in the portfolio value.

The prices of Participation Certificates can decrease in response to a drop in the prices of equity shares or fixed-income instruments comprising the portfolio or in response to losses incurred in trading activity. The unit price may rise or fall on any given day. Monthly and quarterly data provide a better foundation for performance appraisal.

• HSBCL (HSBC Bank Type-B Liquid Fund) and HSBCD (HSBC Bank Type-A Variable Fund) can be traded in multiples of 1 share.
• HYMAD ( HSBC A Type Equity Fund ) can be traded in multiples of 10 shares.
• HSBC Yatırım B Type Variable Fund can be traded in multiples of 25 shares.
• HSBCT ( HSBC Bank B Type Bond Fund) , HYMBT (HSBC Yatırım B Type Bond Fund) and HYEND (HSBC Yatırım A Type ISE National 30 Index Fund ) can be traded in multiples of 100 shares.

You can carry out all your HSBC mutual fund transactions during business hours at our branches and whenever you wish (7 days & 24 hours) through our direct banking channels (HSBC ATMs, HSBC Telephone Banking, and HSBC Internet Banking).

You can carry out all your HSBC mutual fund transactions during business hours at our branches and whenever you wish (7 days & 24 hours) through our direct banking channels (HSBC ATMs, HSBC Telephone Banking, and HSBC Internet Banking).

There are no transaction limits until 13:45 on business days at HSBC Branches, HSBC ATMs, HSBC Telephone Banking (444-0-111), and HSBC Internet Banking (www.hsbc.com.tr).

However, HSBCL (HSBC Bank Type-B Liquid Fund) transactions on business days are limited to a TL 5.000,00 ceiling for purchases between 13:46-18:00 and sales between 13:46-24:00. The ceiling also applies to HSBCL sales during weekends and holidays, but not to HSBCL purchases.

All revenues generated through mutual funds are subject to withholding tax of 10%, on a transaction basis.

The equity shares and fixed-income instruments comprising the portfolio of a fund are kept at Takasbank, where each fund has a separate account in custody. Foreign securities are held by international custody companies specified in the relevant regulations.

The founder of the mutual fund must assign at least one auditor with specific qualifications for every fund. Furthermore, mutual funds are inspected by independent external auditing companies, in accordance with a contract, on a semiannual and annual basis. It is obligatory for the annual audit report to be submitted to the Capital Markets Board. The Board is also entitled to audit mutual funds at all times.

You can visit any HSBC Branch or call HSBC Telephone Banking (444-0-111) for all your questions and information needs.