What Is an Equity Fund?

An equity fund is a mutual fund that puts most of the money it collects into company shares (stocks). SPK's Communiqué III-52.1 ties this type to a clear threshold: at least 80% of the fund's total value must sit continuously in the shares of domestic and/or foreign issuers. The fund's value rises and falls with the price of those shares.

The 80% rule that makes a fund an equity fund

Mutual funds are divided into umbrella fund types in SPK's Communiqué III-52.1 on the Principles Regarding Investment Funds. Under Article 6, funds that continuously invest at least 80% of their total value in "the shares of domestic and/or foreign issuers" are issued under an Equity Umbrella Fund (Hisse Senedi Şemsiye Fonu). This is what is meant in everyday speech by "hisse fonu".

Two details matter:

• The threshold must be met continuously. A fund cannot be run so that it falls below 80% today and climbs back tomorrow.
• The threshold is calculated on total fund value and it covers foreign shares too. An equity fund without the word "Yabancı" (Foreign) in its name may hold at most 20% of its total value in foreign currency and capital market instruments.

The fund and the share inside it are different things. A share gives ownership in a single company. A fund holds the shares of many companies together and is managed by a portfolio management company.

What does "Hisse Senedi Yoğun Fon" mean?

Not every equity fund is an "equity-intensive fund". This is a narrower definition, set out in the second paragraph of Article 6 of the Communiqué. Two conditions apply:

• At least 80% of the fund's portfolio value must consist continuously of issuer shares traded on Borsa İstanbul, excluding the shares of securities investment trusts.
• The fund must be issued under an Equity Umbrella Fund or a Hedge (Serbest) Umbrella Fund.

Shares are not the only thing counted toward this 80%. Cash collateral of futures contracts based on shares and share indices, premiums of option contracts, exchange-traded broker warrants, and the units of exchange-traded funds tracking share indices are also included in the ratio.

Funds carrying this status must include "(Hisse Senedi Yoğun Fon)" at the end of their name, under SPK's Guide on Investment Funds. So they can be told apart from the fund name alone.

The distinction matters because the withholding tax regime depends on it. An equity fund weighted toward foreign shares does not count as an equity-intensive fund, because it does not fill the 80% with Borsa İstanbul shares.

Why does the value fluctuate?

An equity fund's unit price is calculated from the market price of the shares in its portfolio. When the shares fall, the fund falls. The fund has no structure that protects the principal or guarantees a return.

That is the basic difference: in money market and debt instrument funds the return rests largely on interest and maturity, while in an equity fund it rests on the market price of companies.

Because the fund holds many companies together, the risk tied to any single company is spread out. But that does not mean the fund will not fall when the whole market falls. To gauge the fluctuation, one can look at indicators such as volatility and maximum drawdown, at SPK's 1–7 risk value, and at the fund's prospectus.

Index fund or active fund?

Equity funds are managed with two approaches:

• Index funds track a specific index such as the BIST 30. For funds with "Endeks" (Index) in their name, the Communiqué obliges the manager to run the fund so that its return does not deviate significantly from the return of the underlying index. The correlation coefficient between the index value and the fund's unit price must be at least 90%.
• Actively managed funds consist of shares chosen by the portfolio manager rather than replicating an index. They may deviate from the index, and that deviation can go either way.

The management fee and total expense ratio of the two approaches generally differ. What binds each fund is the maximum total expense ratio in its own prospectus.

The withholding tax side

Withholding on gains from mutual fund units falls under Provisional Article 67 of the Income Tax Law; the rates are set by Presidential Decree.

• For equity-intensive funds, the withholding rate on units is 0%. By Decree No. 11107, published on 27 March 2026, the units of hedge (serbest) funds not traded on TEFAS were taken out of this scope.
• For other mutual funds, the rate on units is 17.5%.
• As a separate rule, the relevant paragraph of Provisional Article 67 does not apply to the disposal of units held for more than one year in funds whose portfolio consists continuously of at least 51% shares traded on Borsa İstanbul. Law No. 7566 carved out of this rule: funds whose units may be sold only to qualified investors, that are not traded on TEFAS, and that are not subject to any ratio limits on the assets taken into the portfolio.

Rates can change by decree. For the current position and any personal tax outcome, the fund's prospectus and a tax adviser should be taken as the basis.

Where to look

The list of equity funds, their returns and expense ratios are on the equity funds page. To place funds side by side there is the comparison page, and to measure a past period there is Yatırsaydım.