(Bloomberg) -- Veteran emerging-markets investor Mark Mobius says stocks are the most favorable Turkish asset to invest, whether President Recep Tayyip Erdogan loses the elections or not. 

“Regardless of the outcome there will be excellent opportunities for investing in Turkey,” Mobius said by email in response to questions from Bloomberg, adding he prefers companies with “minimal debt and good offshore earnings.” Mobius Capital Partners is currently invested in software firm Logo Yazilim and apparel maker Mavi Giyim. 

Turkish stocks started 2023 on a loose footing as the prospect of political instability and February’s devastating earthquakes led to high volatility, sending the benchmark index from being 2022’s best performer to ranking among the worst performers. The presidential and parliamentary elections on May 14 have turned into a high-stakes battle between the incumbent Erdogan and his main rival, Kemal Kilicdaroglu, who has promised a return to economic orthodoxy. Kilicdaroglu, the candidate of a unified opposition bloc, leads in most polls, but he may not be able to get more than half of the popular vote, which would trigger a second round.

Wall Street Verdict on Turkish Rates Is for Big Hikes After Vote

For investors who have been busy cutting exposure to Turkey over the past few years on concerns over Erdogan’s policies that sent inflation soaring, the outcome will provide a strong indication on whether to reinvest. While traders see a challenging transition and a significant weakening in the currency after the vote, Mobius said any depreciation is unlikely to be “as dramatic as what has been experienced” over the previous years.

The Borsa Istanbul 100 Index rose 4.7% this week, paring this year’s decline to 6.4%. 

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