<\/p>\n
At first, it was just a curiosity in Turkey\u2019s financial circles: An obscure brokerage firm with a stock that went up and up.<\/p>\n
As the months went by last year, though, the gains in shares of Tera Yatirim Menkul Degerler AS just kept coming, over and over, in staggering amounts \u2013 54%, 108%, 61%, 73%. Even in Turkey, long a hotbed of speculative manias, the sheer pace and scope of the surge \u2013 now totalling almost 40 000% since Tera\u2019s 2022 initial public offering \u2013 stunned investors and sparked a fascination with the financial alchemy that seems to have powered it.<\/p>\n<\/p>\n
To this day, not all the details are fully understood, but a picture has emerged of a firm taking unconventional steps that appear to have fueled a surge in the value of its own stock, according to finance experts who\u2019ve looked at the trading. While the shares have started to slide this week, Tera still has a market value of $4.5 billion, making it one of Turkey\u2019s most valuable companies despite having only about 130 employees. At times this year, the firm has been worth more than global players with thousands of employees, such as Lazard Inc. and BGC Group Inc.<\/p>\n
At the heart of the business is its flagship investment fund, which has gained a cult following on social media for minting astronomical returns: more than 1,500% in the past year alone. It achieved those results by pouring\u00a0billions of lira into a tight circle of related companies and amplified the bets with borrowed cash. The fund amassed stakes in Tera itself, as well as Tera subsidiaries and companies that Tera\u2019s brokerage has helped take public.<\/p>\n
Tera\u2019s multiple roles may create \u201clayered conflicts of interest\u201d that amount to \u201chigh-risk structural conditions,\u201d said Orkun Saka, a lecturer at City St. George\u2019s, University of London, who\u2019s studied Turkey\u2019s economy. The fund\u2019s purchases \u201cpush up affiliated stock prices, which inflates the fund\u2019s net asset value, which makes the fund management business appear more valuable, which elevates the parent company\u2019s earnings and stock price,\u201d he said. \u201cThis loop is self-reinforcing by construction.\u201d<\/p>\n
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Now those gains are drawing scrutiny from regulators and raising questions about Tera\u2019s transactions. Watchdogs at the Capital Markets Board are mulling new rules that would limit a fund\u2019s exposure to related parties and cap concentrated investments, according to a document seen by Bloomberg News. The proposal is aimed mainly at Tera\u2019s strategies, said people familiar with the matter, asking not to be identified, discussing draft proposals. A spokesperson for the regulator declined to comment.<\/p>\n
In the meantime, the surge has propelled Tera\u2019s founder into the ranks of the richest people in Turkey. Emre Tezmen, a 53-year-old former financial analyst, founded the firm 20 years ago and owns a 32% stake that is now worth $1.4\u00a0billion. In an interview at Tera\u2019s headquarters in Istanbul, he rejected any criticism of the firm\u2019s strategy.<\/p>\n<\/p>\n
\u201cEverything we do here is in line with the regulations,\u201d Tezmen said. \u201cWe haven\u2019t done anything that hasn\u2019t been done in global markets.\u201d<\/p>\n
The frenzy around the firm began picking up steam in July last year, when it made the Tera Portfoy First Mutual Fund\u00a0available to retail investors.\u00a0The fund\u00a0quickly drew an ardent following on social media.<\/p>\n
Regulatory filings show that at one point in 2023 the fund had 99% of its assets in a single stock \u2013 shares of its own parent, Tera. The fund bought shares in publicly traded\u00a0Tera subsidiaries, and used borrowed money to buy more shares, filings show. And it invested in companies that Tera\u2019s brokerage unit had helped take public yet which had relatively few shares available for trading, known in finance as a small \u201cfree float.\u201d<\/p>\n
Tera classifies the $2.7 billion\u00a0fund as a high-risk investment.\u00a0 \u201cIt is designed for qualified investors with a medium- to long-term investment perspective, who can tolerate market fluctuations and are suitable for a high risk level,\u2019\u2019 according to the fund\u2019s website.<\/p>\n
One of the most eye-popping examples of the Tera strategy:\u00a0 a\u00a0finance company called Destek Finans Faktoring AS. Bankers for Tera\u00a0took the company public in 2025 and Tera\u2019s fund accumulated a stake that reached 26% of assets under management. The stock has surged more than 4,700% since the IPO at 46.98 liras a share, making Destek the third-largest company on the Borsa Istanbul, with an $18.8\u00a0billion\u00a0market value.<\/p>\n
The Tera fund\u2019s stake now accounts for 18% of the free float. A representative for Destek Finans said in an email that the stock\u2019s performance is driven \u201cby free market principles and the company doesn\u2019t have any interference.\u201d<\/p>\n
Another Tera-owned stock that saw relatively extreme moves was mining company Visne Madencilik Uretim Sanayi ve Ticaret AS. In February 2025, Tera\u2019s brokerage arranged a small\u00a0IPO for Visne that put just 21% of the company\u2019s outstanding stock in public hands.<\/p>\n
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The stock immediately began to soar and\u00a0by the end of July\u00a0was up by more than 2,100%. That same month, Tera\u2019s main fund and brokerage sold the Visne shares they had purchased in the IPO, filings show. The next month, the stock crashed. It lost 75% in August alone and is now down 89% from its peak. A Visne representative declined to comment.<\/p>\n
Tera\u2019s trading of Visne ran afoul of regulators. In October, the Capital Markets Board fined two of the firm\u2019s fund managers 8.9 million liras ($199 000) each over transactions involving the stock. They created \u201cmisleading perception on the price, supply and demand\u201d for the shares, the regulator said, without elaborating. Tera didn\u2019t reply to a request for comment on the fines.<\/p>\n
Such wild stock moves are more than just a quirk. They\u2019re not uncommon in some less-developed markets and can have real repercussions, potentially calling into question a market\u2019s integrity and driving away big investors.<\/p>\n
To Kamil Dimmich at North of South Capital LLP in London, the moves are similar to what\u2019s played out in another emerging market, Indonesia, in recent years.\u00a0 The country has experienced a boom in speculative retail trading with unexplained stock swings of more than 1,000% becoming increasingly common. Some of the biggest gains have been in companies that have low trading volumes and concentrated ownership.<\/p>\n
That speculative excess has drawn concern from index compiler MSCI Inc, which warned about the Indonesian market\u2019s investability and a potential downgrade to frontier-market status. The warning sparked a plunge that has wiped 19% off the value of Southeast Asia\u2019s biggest equity market. Indonesia\u2019s exchange operator said this week it will remove companies with a high concentration of shareholders from some key indexes as a part of market reforms.<\/p>\n
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The Tera-related stock moves reflect \u201cnonsensical squeezes and valuations\u201d fueled by a small free float and a \u201cwild retail shareholder base,\u201d said Dimmich, who helps oversee more than $8 billion at the\u00a0emerging markets fund.<\/p>\n
Officials in Turkey recently acknowledged concerns about unusual market moves, without mentioning Tera.\u00a0Treasury and Finance Minister Mehmet Simsek said in November that authorities were aware of manipulation risks in some investment funds and would strengthen the regulatory framework. Capital Markets Board Chairman Omer Gonul has also pledged tougher penalties for market abuse.<\/p>\n
Tera used massive amounts of borrowing last year, filings show. The brokerage\u2019s borrowing soared to 59.8 billion liras, or about $1.3 billion, at the end of 2025, up from 132 million liras, or about $2.9 million, a year earlier, according to the company\u2019s earnings report. Securities given as collateral climbed to 32.6 billion liras in 2025, up from 121.3 million in the previous year.<\/p>\n
Tezmen said Tera has now\u00a0reduced its use of such loans, without elaborating further on the figures.\u00a0Using short-term borrowing can make sense when interest rates are falling, and it\u2019s a strategy that many banks use, he said.<\/p>\n
Asked about concerns over holding stakes in companies with little free float while using short-term debt, Tezmen dismissed the idea that stock prices can be controlled. He declined to comment on the valuation of Destek Finans or other companies that Tera has taken public or invested in.<\/p>\n
\u201cYou cannot control anything 100% in a market,\u201d he said. \u201cIf that were the case, prices would only go up. There\u2019s no way you can control the market.\u201d<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#stock #surge #mystifying #traders #Turkey<\/p>\n","protected":false},"excerpt":{"rendered":"
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