Matthews Emerging Markets Discovery Active ETF (MEMS)

Overview

The Matthews Emerging Markets Discovery Active ETF seeks long-term capital appreciation by investing in a diversified portfolio of small- and mid-cap companies in emerging markets. It employs an active management approach, focusing on identifying high-quality companies with strong growth potential.

Reputation and Reliability

Matthews Asia is a reputable investment firm with a long history of specializing in Asian and emerging market investments.

Management Expertise

The management team has extensive experience in emerging market equities and employs a disciplined, research-driven investment process.

Goal

To achieve long-term capital appreciation.

Investment Approach and Strategy

Strategy: The ETF employs an active management strategy, selecting securities based on fundamental research and a bottom-up investment approach.

Composition The ETF primarily holds stocks of small- and mid-cap companies located in emerging markets.

Market Share: Limited, as it's a niche fund within the broader emerging markets ETF space.

Total Net Assets (AUM): 60254988

Key Competitors

• VWO
• IEMG
• EEM
• EWEM
• DIME

Competitive Landscape

The emerging markets ETF landscape is dominated by large, passively managed funds. Matthews' active approach and focus on smaller companies offer a differentiated strategy but face competition from lower-cost, index-tracking ETFs. Its active management aims to outperform, but comes with a higher expense ratio. The ETF competes with general emerging market funds and smaller cap-focused funds.

Historical Performance: Historical performance data would need to be sourced from financial data providers like Bloomberg, FactSet or Morningstar.

Benchmark Comparison: Performance should be compared against a relevant emerging market small-cap index.

Expense Ratio: 0.79

Average Trading Volume

The ETF's liquidity is moderate and usually sufficient for institutional and retail investors.

Bid-Ask Spread

The bid-ask spread can be moderate, but still affects trading cost depending on the specific broker.

Market Environment Factors

Emerging market growth rates, currency fluctuations, and geopolitical risks significantly influence the ETF's performance. Changes in small-cap growth prospects and emerging market regulations also play a role.

Growth Trajectory

Growth depends on the ability of the fund manager to identify growing small- and mid-cap companies and on the overall performance of emerging markets.

Competitive Edge

The Matthews Emerging Markets Discovery Active ETF distinguishes itself with its active management and focused approach to emerging market small- and mid-cap companies. The fund benefits from Matthews Asia's deep expertise and research capabilities in emerging markets, which allows for identifying hidden gems and undervalued opportunities. Its active approach allows the fund to be more selective and flexible than passive strategies. This differentiates itself by potentially achieving higher returns, although at higher cost and risk.

Volatility

Emerging market small-cap stocks are generally more volatile than large-cap stocks in developed markets.

Market Risk

The ETF is exposed to emerging market risks such as political instability, currency volatility, and regulatory changes.

Ideal Investor Profile

This ETF is suitable for investors seeking long-term capital appreciation and willing to accept higher risk associated with emerging market small-cap stocks.

Market Risk

The ETF is best suited for long-term investors with a high-risk tolerance, not for active traders or passive index followers.

The Matthews Emerging Markets Discovery Active ETF offers investors access to emerging market small- and mid-cap companies through an actively managed strategy. It leverages Matthews Asia's expertise in emerging markets to identify high-growth potential investments. While the fund offers potential for outperformance, investors should be aware of higher fees and volatility compared to passively managed emerging market ETFs. Its active approach aims to outperform the market, but this can be volatile. This ETF is best for investors seeking diversification and long-term capital growth with a higher risk tolerance.

Data Sources:

• Matthews Asia Website
• ETF.com
• Morningstar

Disclaimers:

This analysis is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results. Investors should consult with a qualified financial advisor before making any investment decisions.