Turkish stocks fell sharply on Wednesday after fund manager Pusula Portföy failed to meet redemption requests. The benchmark BIST 100 index dropped over 5%, with retail investors withdrawing up to $1bn from funds, per Fintables data cited by Bloomberg.

The sell-off began Tuesday when Pusula, with $13bn under management, said some funds couldn't meet redemptions. Analysts blame concentrated buying of affiliated companies, inflating fund values. Two Pusula funds surged 164% and 144% in the first seven months of 2026. Tera Portföy, led by Emre Tezmen, saw even higher returns.

Now redemptions force cash raising and falling prices, leading to more withdrawals. "This is a self-inflicted, 1990s-style emerging-equity market crisis," said Emre Akcakmak of East Capital. "What we're seeing now is effectively a 'fund run'."

Tens of thousands of retail investors may be affected. Pusula had 241,000 accounts; Tera Group over 500,000. Together they managed around $27bn at August end. The shakeout complicates Turkey's stabilization under finance minister Mehmet Şimşek and could throttle equity financing. In the first eight months of 2026, 34 IPOs raised TL82.4bn ($1.7bn). Non-residents held about $41bn of Turkish equities as of September 4. MSCI warned in June of "co-ordinated trading" and may cut Turkey to frontier status.