EFTA01132134.pdf

From: Tazia Smith •:=MMII To: [email protected] Cc: Paul Morris c Vahe Stepanian >, Joseph Cothron Subject: Turkey and ElAttS1) [C] Date: Fri, 27 Dec 2013 19:52:33 +0000 Attachments: GEM_Strategy_12.11.13.pdf 1nl in e-1m ages: unnamed; unnamed(1); unnamed(2) ClIa:ification CAmfglential Jeffrey: Called to gel your News on Turkey. Decanting your views. consider srnp/e implementations on weakness. ncludng short-term sovereign deed (TRY denornnated) ex: TURKGB 8.3% 107115 offered -9.7% and TUR (Shares ETF tracking MSCI Turkey Investable Market Index, oM -22% since 10,25). Our KCP desk has seen a pck.wo in Merest this week on the back of news Row that Ni sure you know teller than most (coasting polbcal truest compounded upon by accusations aganst of bnbery gold smuggIng, and money Leunderng against governrrentoffeials. the replacement of half the cabinet. upcoming elections n 201S. and debate arowid FX intervention going forward to fight TRY depreciation). DB Global Ernerorno Markel (GEM) Research hghlights that. al present levels. the major nths for Turkish equities are prized n (ful report attached. Bloomberg article below). If you agree v.ith the asymmetric upside risk to Turkith *cubes (Moody) corsider: 3250. postern n TUR (lo start) in Southern Fnancial. If you agree with a reverson in credt spreads and a mean reversion from the latest leg in TRY sell-off. consider: 2mm (-Sinn usd worth) of short lain sovereign notes in Southern Trust the aware, they trade thin) Happy to show FX structures around TRY anat., ether debtfequity solubons as well. Separately. the EURUSD bcwiced back up to 1.38 this morning. Curious if you remain bSlish and. if so. you had an coportundy to review the deposit plus strategy (works best d EURUSO bounces within a range - not as good of entry point here. but worth watching for entry point d you decide you it matches you view). Speak with you soon TaS --• Forwarded by lava Smittecbrdbcorn on 12/271X)130225 PM -- Nun, 'Tazia Smith (DEUTSCHE ASSET MANAGr [email protected]> To undiscbsed.recipents::. Onto 12)271201302:2d PM S43.ect (Bel) Foreigners Unload Turkey Bonds as Probe Trenches Erdogan G IBM) Foreigners Unload Turkey Bonds as Probe Tarnishes Erdogan C rowth This has boon prepared solely for informational purposes. It la not an offer, rocormendation or solicitation to buy or sell, nor Is it an official confirnation of terns. It is based on infornation generally available to the public fron sources believed to be reliable. Uo representation is nada that it is accurate or conploto or that any returns indicated will be achieved. changes to aaaumptions may have a material inpact on any returns detailed. Past performance is not indicative of future returns. Price and availability aro subject to change without notice. Additional information is available upon request. Foreigners Unload Turkey Bonds as Probe Tarnishea Erdogan Growth 2013-12-27 IS:16:34.235 GMT By Solcuk Cokoluk and Ksonia Catouchko Doc. 27 IBlocaborg) -- Foreigners are dumping Turkish bonds at the fastost pace in two years, deepening a selloff that's putting a blot on Prima Minister Recap Tayylp Erdogan•a wage as the architect of the country's economic turnaround. International Investors pared their holdings of Turkish debt by 5532 billion to a throe-month low of $53.8 billion in the week through Doc. 20 after selling a not $1.35 billion the week before, the central bank said yesterday. They've cut choir holdings from a record $72 billion in May. The outflows aro a reversal of the 1nvostrent that helped finance Turkeys growth during Erdogan' s 10-year stint, a period in which nominal gross donostic product more than tripled and the country's dollar bonds posted an average 9.7 percent annual gain. A corruption probe that has ensnared his cabinet and led to three ministerial resignations is damaging his reputation and adding to a three-nonth rout in the lira that was triggered in part by the country's widening current-account deficit. ^It significantly unclorminea the facade of *concede EFTA01132134 compotonce that the administration has so carefully constructed in recent years,' lachaol shaoul, the chief executive officer of marketfield Asset Management LLC in Now York, which oversees about 517 billion, said in e-mailed come/mita. 7he lira weakened as much as 2.3 percent to a record 2.1764 amain:it the dollar today, before trading at 2.1581 as of 5:06 III. In Istanbul. A 3.1 percent retreat In the currency this week has taken its 2013 drop to 17 percent, the moat among pears In emerging Europe, the Middle East and Africa after South Africa's rand. Bonds, Stocks 7he lira also plunged as much as 3.5 percent to a record 3.0151 per ouro today, while yields on the government's two-year notes jumped 44 Deals points, or 0.44 percentage point, to 10.17 percent. 7ho rate is up 402 basis points this year, the moat among 20 emerging-market peers monitored by Bloomberg after Brasil. The Borsa latanbul main index fell 1.3 percent today, sot for the iowest level since July 2012. Polies detained sons of the economy, interior and environment ministers, as wall as the chief executive officer of Turkiyo Balk Bankaal AS on Doc. 17 in probes into bribery, money laundering, gold smuggling and corruption in government tenders. All throe ministers resigned, with Environment and Urban Works Minister Erdogan aayraktar urging Erdogan to atop down as he approved the projects ho carried out. 'Co Downhill' Erdogan said the probe amounted to an attempted coup. No told reporters on a return flight from Pakistan on Doc. 24 that his son may bo targeted to tighten the political noose around him. Kemal Kilicdaroglu, Leader of the cmpoaltion Republican People's Party, told CNN-Turk television that Erdogan has formed a "war cabinet' with the appoincmont of his undersecretary Efkan Ala as Interior Minister. "7hloga are eally going to go downhill from hero," Aleksel Belkin, who helps manage about $4.5 billion in assets as chief investment officer at Kapltal Asset Management LLC in Moscow, said by phone. 'The Turkish market now combines investors' worst fears: political uncertainty and the current-account deficit.' 7ho government projects the current-account deficit will widen to 7.1 percent of gross domestic product for 2013 from 6.1 percent a year earlier. When the gap jumped to a record 10 percent in 2011, the lira tumbled 18 percent. Greater Volatility Erdogan said the probe is backed by international forces uncomfortable with the speed of Turkey's oconomic development. Me replaced 10 ministers in his 26-member cabinet earlier this week, parting ways with those implicated in the probe. Ho appointed his deputy minister Bokir Boadag as justice minister to lead the legal battle as tension increases between the government and followers of a U.S.-based imam, Fothullah Guian a who roll out with Erdogan lately and who aro influential in the judiciary and police forces. "People like to have stability and they have to like predictability in what's going to happen,' Pablo Clailino, money manager at Stone Harbor Investment Partners LP Which oversees 555 billion in emerging-market debt including Turkey bonds, said in a telephone interview from NOW York. "SO all oe this volatility, accusations and stuff like that going on are obviously not a vary helpful environment." For Related News and Information: Turkey stocks Slump With Lira as Minister Urges Erdogan to Cult NSN MYDDBE67TDSO <CO> Turkey Ruling Party in Decline Amid Probe, Former Member Says NSW MYDDRP6JIJUR <GO> Sahin Resigns From Erdogarra Party Citing Rule of Law Concerns NSW MYDC8K67TDS8 <CO> Top news on Turkey: TOP TR <GO> Stories on Turkish stocks: TWI TURKEY STK <00, --With assistance from Bon Bain in Mexico City and Ye %le in NOW York. Editors: David Papadopouloa, Daliah Warsaw, To contact the reporters on this story: Selcuk Gokoluk in Istanbul at 490-212-317-3907 or agokoluklbloomborg.net, Kaenia Galouchko in Now York at +7-499-271-3389 or kgalouchkolebloomberg.not To contact the editors responsible for this story: Claudia beadier at v971-4-364-1028 or allarldlereb1007therg.riet, Mojciech Moatwa at v48-22-433-4475 or wmoskvagisloomberg.not Forwarded by Tana Smilfrebtdbcom on 12027,2013 01 42 PM ream Tana Srrsaildbklbcom To. jeevesalicnrgarnail.ccrn. Cc Paul Morris. Vahe SleoaniandardbcorngC43Arnericas Dale 12/2412201310:59 MI Subject EURUSO Oepos1PMs. 4.5% annualized yield (C) EFTA01132135 Classification: Confidential Jeffrey: Monetize your bulish view on the two to pick up yield with short duration via a EURUSD DepositPlus (sell USDcEURp and collect premium). if assigned. (lip to EUR on deposit spot ref: 1.38705 EURUSO Deposal Plus (USDon deposit) Tense: {month Strike: -1.3573 Yield: 4.5% annualized {paid in USD) Note the uptick to kagendated sovereign periphery credit ex Portugal 3.15% 10/15015.-2.92% Consider 35-10mm USD in Southern Financial Updated at 10:66:01 CCY pair EURU SD Deposit CCY USD Spot rate 1.36705 Zone cut NY (New York) Yield Isasdisit) Was Laa 2.5:2fi 3.44% 3.547E 9.44% Lin MEE 1225 LW% 6,22% 07-Jan-14 (2W) 0.1686 1.3549 1.3560 1.3570 1.3579 1 3587 1 3595 1.3602 1.3609 1.3615 1.3621 28-Jan-14 (1M) 0.1729 1 3463 1.3490 1 3513 1 3535 1 3555 1.3573 1.3590 1 3606 1.3622 1.3636 Source: Da Autobahn, 12/24/13 Tana Smith reactor I Key Clent Partners • US Deutsche Bark Securities Inc Deutsche Asset & Wealth Management Paarita..-hr Perform This communication may contain confidential and/or privileged information. 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