Garanti of Turkey to launch $306 mln hedge fund

ISTANBUL, April 20 (Reuters) - Garanti Bankasi (GARAN.IS), Turkey's second-biggest bank by market value, said on Monday it was launching a hedge fund with a registered capital of 500 million lira ($306 million) within a month.

The hedge fund, to be called Istanbul Fon, aims for 70 percent of its investments to be in Turkish assets and the rest to be in securities issued by G7 governments and companies, according to statement in the Capital Markets Board bulletin from Gur Cagdas, head of Garanti Portfolio Management.

Garanti's fund will operate with maximum three times leverage and can invest in all money market and capital market securities, including sovereign bonds, stocks, company bonds, fixed-income securities, forex futures contracts and credit derivatives.

Garanti, the busiest stock in Istanbul on Monday, fell 2.6 percent to 3 lira at 1300 GMT, in line with the banking index .XBANK, which fell 2.7 percent. (Editing by David Holmes)