Download - FEAS

FEDERATION OF EURO-ASIAN STOCK EXCHANGES ANNUAL REPORT JUNE 2010GARANTI ASSET MANAGEMENTGur CagdasGeneral ManagerProviding a unique service with high addedvalue to investors, Garanti AssetManagement has won acclaim at nationaland international platforms.Garanti Portfoy (Garanti Asset Management) asubsidiary (100%) of Turkiye Garanti BankasiA.S. (Garanti Bank); was founded as the firstasset management company of Turkey in 1997.The Company holds asset management andinvestment consultancy authorizationcertificates and serves domestic and foreigncorporate and individual investors as its targetgroup. Garanti Asset Management serves inthe following business lines: Mutual FundsManagement, Pension Funds Management,Discretionary Portfolio Management andAlternative Investments.Garanti Asset Management built its investmentphilosophy on the following grounds: tomanage customer assets in the most effectivemanner possible; to ensure sustainable assetgrowth; to reflect investor demands to portfoliostructures in the swiftest and most appropriatemanner and to keep continuous control overrisk levels. The success of Garanti AssetManagement’s investment policy lies insystematically researching various investmentinstruments, effective decision-makingprocesses, and subjecting all investmentdecisions to disciplined and persistent riskmanagement.Providing a unique service with high addedvalue to investors with 61 professional staff,Garanti Asset Management has won acclaim atnational and international platforms, thanks toits effective business approach and robustbrand image.Garanti Asset Management’s decision-makingprocess is composed of two basic steps:determination of asset allocation and selectionof assets.The determination of asset allocation is the firststep in the decision-making process at GarantiAsset Management. The General Manager andDeputy General Managers are briefed ontargets and expectations during the weeklymeetings of the Strategy Committee. Scenariosare analyzed by the committee to determinethe returns expected for each investmentinstrument; alternative scenarios areconsidered and debated in detail to decide onthe best relative weights for investmentvehicles. The results of the strategies arefollowed and their impacts on performance arereviewed during a daily morning meeting.Garanti Asset Management also obtainsconsultancy support from third parties beforethe Strategy Committee within the framework ofthe circumstances of the day.Selection Process is the second step of thedecision-making procedure at Garanti AssetManagement. In the selection of fixed incomeinstruments, decisions taken at the StrategyCommittee, which take account ofmacroeconomic data and expectations areapplied to the portfolios by the initiatives ofrelated coordinators and fund managers.The selection of equities is coordinated by theEquity Selection Committee. This committee,comprised of investment analysts and equityfund/portfolio managers, evaluates relatedresearch reports in a comprehensive mannerand initiates the equity selection process withcorrect market timing. At the end of thecommittee meeting, model portfolios aredesigned and asset allocations are determinedby evaluating return potentials of equities.In addition to ordinary committee meetings,Garanti Asset Management closely monitorsimmediate developments on economic andpolitical platforms. Within this framework, theCompany may make immediate adjustments ininvestment decisions, which it swiftly applies tothe portfolios.Garanti Asset Management employs effectiveand active risk management mechanismswhich encompass all investment processes. Aspart of its pre-defined risk control mechanisms,the Company continuously monitors theexpected returns and maximum sustainablelosses for all investment instruments. In otherwords, at Garanti Asset Management, the yieldand loss potential of each investment is knownin advance.Garanti Asset Management employs twodifferent resources in its market riskmanagement activities,:• The Management Information System (MIS)reporting is one of the techniques utilized byGaranti Asset Management in the field of riskmanagement. MIS reporting, which is highlyprecious in terms of summarizing all of thecorporation’s risks, is simple, brief andexclusive. Data fed into the system designedby Rasyonet is submitted over infrastructuresupplied by Garanti Technology.• The risk management product developedwith Rasyonet allows assessment of marketrisks, as well as the liquidity risk.Garanti Asset Management boasts its perfectdistribution channel. We are effectively usingthe distribution channel which we developedwith our main shareholder, Garanti Bank. Weare highly ambitious in this segment. We boastthe best practice in Turkey while proactivelyand continuously taking part and working in thefield in collaboration with Garanti Bank.Garanti Asset Management continues to pressahead with its assertion of being the best andthe most effective provider of services in theTurkish asset management industry and movedahead with its partnership, and also as the firstcompany of the sector through realizing newprojects and products.The Capital Guaranteed Fund, the PrincipalProtected Fund and Hedge Fund were all keysteps taken in 2009 within our synergiccooperation with Garanti Bank. Having offeredguaranteed and protecting funds to the marketjust at the right point in the conjuncture,Garanti Bank became one of the leadingissuers in this field through the robustcooperation developed with our company.At a time when change has gained pace and iseffectively experience, we as a team areextremely proud to present Garanti AssetManagement as a shining example ofperformance and sustainability.As our 13-year past offers an insight to thehistory of the collective investment instrumentsindustry in our country, growth andperformance that we have shown is in view asa real example of sustainability.The “Istanbull Fund”, a hedge fund founded byGaranti Bank, which is managed by GarantiAsset Management, was registered to theCapital Markets Board in April 2009. ManagingTurkey’s largest hedge fund will present anexciting expansion for Garanti AssetManagement.The fund addresses a segment of qualifiedinvestors seeking high returns by taking highrisks. These funds primarily aim at thoseinstitutions and individuals with large scaleportfolios in Turkey.The Istanbull Fund, with its maximum leveragerate of 3, invests in various money and capitalmarket instruments including, but not limitedto, fixed income securities, government bonds,equities, private sector bonds, forwardexchange contracts and loan derivatives.PAGE 38