Voluntary Participation (IPS) Auto Enrollment System (AES) Funds Legislation Data Center

Voluntary IPS Funds

The pension mutual fund is a mutual fund created to invest the contributions that are collected by the pension company under the pension contract and are managed in the individual pension accounts on behalf of the participants. Created by pension companies. Does not have a legal entity. Managed by portfolio management companies.

The type of the pension mutual funds is determined based on the investment instruments they contain; e.g. government bonds and bills, stocks, deposits, and so on. Pension mutual funds may be purchased only by those entering the IPS. Withholding tax shall not be apply to the returns from pension mutual funds. These funds are managed with long-term investment strategies.

You can invest in the funds you prefer without a minimum or maximum limit.




However, you can select among the funds as part of your plan and distribute between them within the stated limits. Pension plans may have investment limits in parallel with the fund's strategy according to the risk-return expectations of the target participants.

The accumulation in your individual pension account, and your paid contributions' distribution ratios and amounts between funds may be changed a maximum of six times per year. You can make a change request in writing, through the pension company's call center, or on the website by going to the secure page created on behalf of the participant, sponsor or employer, or via other electronic communication tools, including text message, email, internet, fax, and so on.

IPS does not offer any guarantees on return. You can select a pension mutual fund offered by the pension company with different risk and return levels to choose the fund that is most suitable to your risk profile.

If you do not make a selection among the IPS funds, your accumulations shall be invested in the Standard Fund.

Group Pension Mutual Fund is a type of fund that is created for certain businesses, occupations and industries, and on the condition of approval by the Capital Markets Board, to allocate the funds to certain persons or groups.

No-interest IPS funds

The personal pension system provides pension mutual funds that are invested in no-interest instruments and are compliant with the Islamic finance rules and the participation banking principles for participants who are conscious about interest.

These no-interest funds are invested in the instruments that are approved by the relevant pension company’s Advisory Board, are deemed permissible in accordance with Islam, and are appropriate for no-interest and participation banking principles.

Financial instruments of no-interest pension mutual funds may briefly contain the following:

  • Participation accounts in Turkish lira, Euro or US dollar opened in participation banks,
  • No-interest Turkish lira, Euro or US dollar assets, and capital market instruments that do contain precious metals such as gold and silver,
  • Stocks that are suitable for the participation index and participation banking principles,
  • Gold and precious metals,
  • No-interest securities mutual funds (e.g., venture capital investment funds, real estate mutual investment, etc.),
  • No-interest bonds and bills such as sukuks (lease certificates) that are issued in Turkey or abroad.


Fund Details

Stocks Fund

At least 80 percent of the fund portfolio continuously consists of domestic and/or foreign issuers.

Bonds and Bills Fund

The reverse repo fund with at least 80 percent of the fund portfolio continuously consisting of domestic and/or foreign government and/or private sector bonds and bills, and government bonds and bills.

Participation Fund

The fund with a fund portfolio continuously consisting of rent certificates, participation accounts, partnership shares, gold and other precious metals, and the non-interest monetary and capital market instruments approved by the Board.

Composite Fund

The fund with at least 80 percent of the fund portfolio consisting of at least two of the partnership shares, bonds and bills, gold and other precious metals, and rent certificates, provided that each value is not below 20 percent of the fund portfolio.

Money Market Fund

The fund with a fund portfolio that continuously consists of high-liquidity monetary and capital market instruments that have maximum 184 days to maturity and have a daily-calculated maximum weighted-average maturity of 45 days.

Precious Metals Fund

The fund with at least 80 percent of the fund portfolio continuously consisting of gold and other precious metals, and monetary and capital market instruments based on them.

Index Fund

The fund that at least 80 percent of the fund portfolio consisting of all, or a part selected though sampling, of the assets from a Board-approved index, and that aims to achieve at least 0.9 coefficient of correlation between the basis index and the fund’s unit share value and yield a return that equals the increase in the index.

Fund shall meet the following conditions:

a) The index that is made up of the shares of the issuers it follows and the fund portfolio that follows this index shall consist of at least six issuers’ shares, and the weight of shares of each issuer in the index/fund portfolio shall not exceed 30 percent in the total index/fund value,

b) The index that is made up of the government bonds and bills or private bonds and bills which it follows, and each of the government bonds and bills in the fund portfolio that follows this index shall have a weight of no more than 35 percent in the index/fund portfolio value,

c) The index that is made up of the real estate certificates or private sector real estate certificates which it follows and the fund portfolio that follows this index shall consist of at least four real estate certificates, and each of the real estate certificates or private sector real estate certificates in the index/fund portfolio shall have a weight of no more than 35 percent in the index/portfolio value.

Fund Basket Fund

The repo fund with at least 80 percent of the portfolio consisting of mutual funds and stock market mutual funds.

The 80-percent calculation shall be made by taking into account the investment made in the stock market mutual fund participation shares traded in foreign stock markets and in the foreign fund participation shares of which the prospectus on participation share sale has been approved by the Board.

Fund Basket Fund bylaw shall contain strategies for the planned mutual fund and stock market mutual fund investments.

Contribution Fund

This fund is created pursuant to the Regulation on State Contribution in the Individual Pension System to invest the contributions paid on behalf of the participants.

Flexible Fund

This fund does not fall within the description of any of the aforementioned types in terms of portfolio limitations.

Standard Fund

This fund is managed according to the principles set forth in article 2 in the Provisions on the Pension Plan section of the Circular on the Private Pension System No. 2016/39. 

Life-Cycle / Target Fund

This fund is created with an investment strategy by taking into account the participant's retirement date, risk perception, age, and other specifications.