Matthews International Funds (ASIA)

Overview

Matthews International Funds primarily focuses on providing investors access to emerging and frontier markets, offering exposure to companies with significant growth potential in these regions. They utilize an active management approach to identify and invest in companies that meet their investment criteria. The asset allocation typically involves a diversified portfolio of stocks in various sectors within the target markets.

Reputation and Reliability

Matthews Asia has a strong reputation for its expertise in Asian markets, with a long track record of managing investments in the region. They are known for their research-driven approach and focus on long-term investing.

Management Expertise

The management team consists of experienced professionals with deep knowledge of Asian and emerging markets. They have a dedicated research team that conducts thorough due diligence on potential investments.

Goal

To achieve long-term capital appreciation by investing in companies located in Asia and other emerging markets.

Investment Approach and Strategy

Strategy: Matthews International Funds employs an active management strategy focused on bottom-up stock selection based on fundamental research.

Composition The ETF primarily holds stocks of companies operating in Asia ex-Japan and other emerging markets, spanning various sectors. It may also hold cash or other liquid assets for portfolio management purposes.

Market Share: Matthews International Funds has a moderate market share within the emerging markets ETF category.

Total Net Assets (AUM): The AUM for Matthews International Funds varies depending on the specific fund and market conditions.

Key Competitors

• VWO
• IEMG
• EEM

Competitive Landscape

The emerging markets ETF landscape is highly competitive, with several large players offering similar investment strategies. Matthews International Funds differentiates itself through its active management approach and deep focus on specific regions or sectors. The advantage is the potential for outperformance but at the cost of higher expense ratios. The disadvantage can be underperformance to passive ETFs due to market volatility, or poor active stock picks.

Historical Performance: Historical performance data varies for each fund, and past performance is not indicative of future results.

Benchmark Comparison: The ETF's performance is compared to relevant emerging market indices like the MSCI Emerging Markets Index to assess its performance.

Expense Ratio: The expense ratio varies across Matthews International Funds but is typically higher than passively managed ETFs due to the active management strategy.

Average Trading Volume

The average trading volume for Matthews International Funds varies depending on the specific fund and market conditions. It is generally sufficient for most investors.

Bid-Ask Spread

The bid-ask spread varies based on the ETF and market conditions; generally, the narrower the spread, the more liquid the ETF.

Market Environment Factors

Economic growth in emerging markets, geopolitical events, currency fluctuations, and commodity prices can significantly impact Matthews International Funds.

Growth Trajectory

The growth trajectory depends on factors such as investor demand for emerging market exposure, the fund's ability to generate positive returns, and overall market conditions. The active management will mean periodic changes to the holdings as their research team see fit.

Competitive Edge

Matthews International Funds' competitive edge lies in its deep expertise in Asian and emerging markets, its research-driven active management approach, and its focus on bottom-up stock selection. Their on the ground research and team with language skills, provides an additional advantage over passive ETFs. This focus enables them to identify undervalued companies with strong growth potential. The ability to adapt quickly to change and shift quickly with a team to validate companies and investment strategies also sets them apart.

Volatility

Emerging markets are inherently more volatile than developed markets, leading to potentially higher volatility for Matthews International Funds.

Market Risk

Specific risks include political instability, currency risk, regulatory changes, and economic downturns in the emerging markets in which the fund invests.

Ideal Investor Profile

The ideal investor is one seeking long-term capital appreciation through exposure to emerging markets and is willing to accept a higher level of risk. Investors with a long-term investment horizon and tolerance for volatility would find the fund most suitable.

Market Risk

Matthews International Funds is best suited for long-term investors who are comfortable with the risks associated with emerging market investing and who believe in the value of active management.

Matthews International Funds provide access to Asian and emerging market equities through active management. With higher expense ratios, there is a bet that the active management will produce greater returns than a passive investment strategy. The funds may have greater potential returns in the long run, though emerging markets often carry larger risks. Investors should weigh the potential benefits of active management against passive alternatives before making investment decisions.

Data Sources:

• Matthews Asia Official Website
• ETF.com
• Morningstar

Disclaimers:

This analysis is based on publicly available information and is intended for informational purposes only. It does not constitute investment advice. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.