Under normal circumstances, the Matthews Emerging Asia Fund seeks to achieve its investment objective by investing at least 80% of its net assets, which include borrowings for investment purposes, in the common and preferred stocks of companies located in Asia excluding Japan, South Korea, Hong Kong and Singapore. The Fund may also invest in the convertible securities, of any duration or quality of companies located in Asia excluding Japan, South Korea, Hong Kong and Singapore. The Fund is expected to invest a substantial portion of its net assets in the emerging countries and markets in the Asian region, including but not limited to, Bangladesh, Cambodia, China (including Taiwan, but excluding Hong Kong), India, Indonesia, Laos, Malaysia, Mongolia, Myanmar, Pakistan, Papua New Guinea, Philippines, Sri Lanka, Thailand and Vietnam ("Emerging Asian Countries"). The Fund seeks to invest in companies capable of sustainable growth based on the fundamental characteristics of those companies, including balance sheet information; number of employees; size and stability of cash flow; management’s depth, adaptability and integrity; product lines; marketing strategies; corporate governance; and financial health.
Risks
Investments in Asian securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. Investing in emerging and frontier markets involves different and greater risks, as these countries are substantially smaller, less liquid and more volatile than securities markets in more developed markets.
The risks associated with investing in the Fund can be found in the
prospectus.
Asia excluding Japan, South Korea, Hong Kong and Singapore - Consists of all emerging countries and markets in the Asian region, excluding Japan, South Korea, Hong Kong and Singapore
Fees & Expenses
Gross Expense Ratio
1.65%
Net Expense Ratio
1.42%
Performance
Monthly
Quarterly
Calendar Year
As of 12/31/2020
Average Annual Total Returns
Name
1MO
3MO
YTD
1YR
3YR
5YR
10YR
Since Inception
Inception Date
Matthews Emerging Asia Fund
MEASX
5.92%
19.17%
-2.16%
-2.16%
-7.24%
2.43%
n.a.
3.29%
04/30/2013
MSCI Emerging Markets (EM) Asia Index
7.10%
18.93%
28.77%
28.77%
9.34%
14.81%
n.a.
9.03%
As of 12/31/2020
Average Annual Total Returns
Name
1MO
3MO
YTD
1YR
3YR
5YR
10YR
Since Inception
Inception Date
Matthews Emerging Asia Fund
MEASX
5.92%
19.17%
-2.16%
-2.16%
-7.24%
2.43%
n.a.
3.29%
04/30/2013
MSCI Emerging Markets (EM) Asia Index
7.10%
18.93%
28.77%
28.77%
9.34%
14.81%
n.a.
9.03%
For the years ended December 31st
Name
2020
2019
2018
2017
2016
2015
2014
Matthews Emerging Asia Fund
MEASX
-2.16%
-1.01%
-17.58%
18.42%
19.25%
-2.56%
17.39%
MSCI Emerging Markets (EM) Asia Index
28.77%
19.65%
-15.16%
43.27%
6.53%
-9.47%
5.27%
Source: BNY Mellon Investment Servicing (US) Inc. All performance is in US$.
Assumes reinvestment of all dividends and/or distributions before taxes. All performance quoted represents past performance and is no guarantee of future results.Investment return and principal value will fluctuate with market conditions so that when redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the return figures quoted. Returns would have been lower if certain of the Fund’s fees and expenses had not been waived. Performance differences between the Institutional class and the Investor class may arise due to differences in fees charged to each class.
Additional performance, attribution, liquidity, value at risk (VaR), security classification and holdings information is available on request for certain time periods.
Growth of a Hypothetical $10,000 Investment Since Inception
(as of 12/31/2020)
Source: BNY Mellon Investment Servicing (US) Inc. All performance is in US$.
The performance data and graph do not reflect the deduction of taxes that a shareholder would pay on dividends, capital gain distributions or redemption of fund shares.
Past performance is no guarantee of future results. High ratings and rankings does not assure favorable performance.
Lipper Analytical Services, Inc., rankings are based on total return, including reinvestment of dividends and capital gains for the stated periods. Funds are assigned a rank within a universe of funds similar in investment objective as determined by Lipper. For the absolute rankings shown the lower the number rank, the better the Fund performed compared to other funds in the classification group. Lipper also calculates a quartile ranking which divides the peer group into quartiles to identify funds of similar quality. Funds in the 1st or 2nd quartile had outperformed the average fund in the peer group while funds in the 3rd or 4th quartile had underperformed.
Taizo Ishida is a Portfolio Manager at Matthews Asia. He manages the firm's Asia Growth, Emerging Asia, and Japan Strategies. Prior to joining Matthews Asia in 2006, Taizo spent six years on the global and international teams at Wellington Management Company as a Vice President and Portfolio Manager. From 1997 to 2000, he was a Senior Securities Analyst and a member of the international investment team at USAA Investment Management Company. From 1990 to 1997, he was a Principal and Senior Research Analyst at Sanford Bernstein & Co. Prior to beginning his investment career at Yamaichi International (America), Inc. as a Research Analyst, he spent two years in Dhaka, Bangladesh as a Program Officer with the United Nations Development Program. Taizo received a B.A. in Social Science from International Christian University in Tokyo and an M.A. in International Relations from The City College of New York. He is fluent in Japanese.
Robert Harvey is a Portfolio Manager at Matthews Asia and manages the firm's Emerging Asia Strategy. Prior to joining Matthews Asia in 2012, he was a Senior Portfolio Manager at PXP Vietnam Asset Management from 2009 to 2012, where he focused on Vietnamese equities. Previously, he was a Portfolio Manager on the Global Emerging Markets team at F&C Asset Management in London from 2003 to 2009. Robert started his investment career in 1994 as an Assistant Equity Portfolio Manager with the Standard Bank of South Africa's asset management division. He received a Bachelor of Commerce in Accountancy and Commercial Law from Rhodes University in South Africa and a Bachelor of Accounting Science in Advanced Management Accounting, Taxation and Auditing at the University of South Africa.
Top 10 holdings may combine more than one security from the same issuer and related depositary receipts. Source: BNY Mellon Investment Servicing (US) Inc.
Portfolio Breakdown (%)
(as of 12/31/2020)
Sector Allocation
Country Allocation
Market Cap Exposure
Sector
Fund
Benchmark
Difference
Consumer Staples
26.7
5.2
21.5
Consumer Discretionary
24.1
20.5
3.6
Financials
21.3
14.7
6.6
Health Care
5.4
5.6
-0.2
Industrials
5.3
4.5
0.8
Real Estate
4.8
2.2
2.6
Materials
3.2
4.8
-1.6
Energy
3.0
3.1
-0.1
Information Technology
2.7
25.4
-22.7
Communication Services
0.0
12.4
-12.4
Utilities
0.0
1.7
-1.7
Cash and Other Assets, Less Liabilities
3.4
0.0
3.4
Sector data based on MSCI’s revised Global Industry Classification Standards. For more details, visit www.msci.com.
Country
Fund
Benchmark
Difference
Vietnam
17.4
0.0
17.4
Indonesia
12.5
1.7
10.8
India
11.6
11.6
0.0
China/Hong Kong
10.9
49.0
-38.1
Bangladesh
10.9
0.0
10.9
Pakistan
10.8
0.0
10.8
Sri Lanka
8.4
0.0
8.4
Philippines
8.3
0.9
7.4
Thailand
2.5
2.3
0.2
Australia
2.2
0.0
2.2
Singapore
1.1
0.0
1.1
South Korea
0.0
16.8
-16.8
Taiwan
0.0
15.8
-15.8
Malaysia
0.0
1.9
-1.9
Cash and Other Assets, Less Liabilities
3.4
0.0
3.4
Not all countries are included in the benchmark index(es).
Equity market cap of issuer
Fund
Benchmark
Difference
Mega Cap (over $25B)
8.3
63.5
-55.2
Large Cap ($10B-$25B)
8.1
19.7
-11.6
Mid Cap ($3B-$10B)
18.1
15.1
3.0
Small Cap (under $3B)
62.1
1.7
60.4
Cash and Other Assets, Less Liabilities
3.4
0.0
3.4
Source: FactSet Research Systems.
Percentage values in data are rounded to the nearest tenth of one percent, so the values may not sum to 100% due to rounding. Percentage values may be derived from different data sources and may not be consistent with other Fund literature.
There is no guarantee that the Fund will pay or continue to pay distributions.
Past performance is no guarantee of future results. Investment return and principal value will fluctuate with changing market conditions so that shares, when redeemed, may be worth more or less than their original cost.
For the quarter ending September 30, 2020, the Matthews Emerging Asia Fund returned 9.50% (Investor Class) and 9.55% (Institutional Class), while its benchmark, the MSCI Emerging Markets Asia Index, returned 12.07%.
Market Environment:
Equity markets in Bangladesh and Pakistan saw a strong rebound in the third quarter, following a tough start to the year. Investor sentiment strengthened on improving macroeconomic data, historically low equity price valuations and easing coronavirus fears. For Bangladesh and Pakistan, hopes for a V-shaped economic recovery are gaining momentum, and foreign exchange reserves are trending in a positive direction for both countries. Both Bangladesh and Pakistan continue to see strong remittances, in which family members living and working abroad send money home. While the number of new infections of coronavirus is rising in both Bangladesh and Pakistan, overall mortality rates have not gone up for either country. We see a similar trend in India, where infections are rising but overall mortality rates haven’t changed meaningfully. Youthful populations may partly explain the health resiliency of these countries amid the pandemic.
Equity markets in Indonesia were weak because the government had returned to extreme lockdowns related to the pandemic, which has been bad for the economy. Local investors in Indonesia have also generally been disappointed in president Joko Widodo’s handling of economic issues. Markets in Thailand were also weak amid political unrest related to an unpopular new king ascending to the throne. From a currency perspective, the Indian rupee, Pakistani rupee, Malaysian ringgit, and Philippine peso all appreciated relative to the U.S. dollar. In contrast, the Indonesian rupiah and Thai baht depreciated.
Performance Contributors and Detractors
A contributor to Fund performance during the quarter was British American Tobacco, a Bangladesh-based tobacco producer whose share price had previously been under pressure. In terms of tobacco sales, business as usual has resumed quickly in Bangladesh following the initial lockdowns related to the pandemic. The company’s earnings have improved recently and investor sentiment has gained strength. In addition, the company has launched a new business line exporting completed cigarettes to China. The cost of producing cigarettes in Bangladesh—both in terms of agriculture and labor—are lower than China, creating interesting export opportunities for the company. Elsewhere, Vietnamese fishery Vinh Hoan, was another contributor. The company produces and exports high-quality white fish fillets, mainly to the U.S. Improving sales numbers buoyed by premium products lifted the stock price.
Detractors included Thailand-based consumer discretionary company Central Retail and consumer staples company Thai Beverage. Their share prices declined amid broader negative local investor sentiment in Thailand but both companies remain stable businesses. Thailand is currently experiencing considerable political unrest related to their new king and military government, both of whom are unpopular among the country’s citizens. The market environment in Thailand has been very weak amid political demonstrations and unrest. Another detractor was Indonesian household goods producer Kino Indonesia amid poor investor sentiment toward Indonesian equities in the face of further lockdowns.
From a country perspective, stock selection in Pakistan and our overweight to Bangladesh and Vietnam contributed to relative performance. These markets experienced strong gains as their economies began to reopen. In contrast, our overweight to Indonesia and Thailand detracted from performance. Both markets were weak overall on political concerns.
Notable Portfolio Changes:
During the quarter, we added new positions in China, where there have been a number of new IPOs. We have historically been underweight China relative to the benchmark, and we expect to remain underweight looking ahead, as our focus remains on less developed markets within Asia. At the same time, we’ve added incrementally to our China holdings reflecting compelling bottom-up investment opportunities. For example, we initiated a new position in Xpeng, a Chinese electric vehicle (EV) maker with a strong focus on innovation and technology. China is a natural market for EVs in our view, as much of the rural parts of the country already use electric two wheelers. We also exited a few positions in the quarter among our microcap stocks, primarily on liquidity concerns.
Outlook:
Looking ahead, we expect many economies among less developed parts of Asia to begin to slowly return to normal. Interest among domestic investors in frontier equity markets picked up considerably in the quarter. As conditions on the ground have started to stabilize, we expect to see a corresponding recovery among equity prices in markets such as Pakistan, Vietnam and Bangladesh. Indonesia recently passed a new omnibus law, easing labor laws for employers and encouraging more foreign industrial investment. One country facing a potentially slower recovery is Sri Lanka, which faces twin deficits that include a current account deficit and budget deficit. The country is also quite dependent on tourism, which has dried up as global travel evaporated. On balance though, we remain optimistic about the long-term growth potential for less developed markets in Asia. Youthful workforces, rising consumption and attractive equity valuations make these markets very compelling to us on a long-term view.
As of 09/30/2020, the securities mentioned comprised the Matthews Emerging Asia Fund in the following percentages: British American Tobacco Bangladesh Co., Ltd., 3.7%; Vinh Hoan Corp., 4.7%; Central Retail Corp. Public Co., Ltd., 2.1%; Thai Beverage Public Co., Ltd., 2.2%; PT Kino Indonesia, 2.8%; XPeng, Inc. ADR, 2.1%. Current and future portfolio holdings are subject to change and risk.
Average Annual Total Returns - MEASX as of 12/31/2020
1YR
3YR
5YR
10YR
Since Inception
Inception Date
-2.16%
-7.24%
2.43%
N.A.
3.29%
04/30/2013
All performance quoted is past performance and is no guarantee of future results. Investment return and principal value will fluctuate with changing market conditions so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the return figures quoted. Returns would have been lower if certain of the Fund's fees and expenses had not been waived. Please see the Fund's most recent month-end performance.
Fees & Expenses
Gross Expense Ratio
1.65%
Net Expense Ratio
1.42%
Matthews has contractually agreed (i) to waive fees and reimburse expenses to the extent needed to limit Total Annual Fund Operating Expenses (excluding Rule 12b-1 fees, taxes, interest, brokerage commissions, short sale dividend expenses, expenses incurred in connection with any merger or reorganization or extraordinary expenses such as litigation) of the Institutional Class (which is offered through a separate prospectus to eligible investors) to 1.20%, first by waiving class specific expenses (e.g., shareholder service fees specific to a particular class) of the Institutional Class and then, to the extent necessary, by waiving non-class specific expenses (e.g., custody fees) of the Institutional Class, and (ii) if any Fund-wide expenses (i.e., expenses that apply to both the Institutional Class and the Investor Class) are waived for the Institutional Class to maintain the 1.20% expense limitation, to waive an equal amount (in annual percentage terms) of those same expenses for the Investor Class. The Total Annual Fund Operating Expenses After Fee Waiver and Expense Reimbursement for the Investor Class may vary from year to year and will in some years exceed 1.20%. If the operating expenses fall below the expense limitation in a year within three years after Matthews has made a waiver or reimbursement, the Fund may reimburse Matthews up to an amount that does not cause the expenses for that year to exceed the lesser of (i) the expense limitation applicable at the time of that fee waiver and/or expense reimbursement or (ii) the expense limitation in effect at the time of recoupment. This agreement will remain in place until April 30, 2021 and may be terminated at any time by the Board of Trustees on behalf of the Fund on 60 days’ written notice to Matthews. Matthews may decline to renew this agreement by written notice to the Trust at least 30 days before its annual expiration date.
The Markit iBoxx Asian Local Bond Index tracks the total return performance of a bond portfolio consisting of local-currency denominated, high quality and liquid bonds in Asia ex-Japan. The Markit iBoxx Asian Local Bond Index includes bonds from the following countries: China (on- and offshore markets), Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, South Korea, Taiwan and Thailand.
The J.P. Morgan Asia Credit Index (JACI) tracks the total return performance of the Asia fixed-rate dollar bond market. JACI is a market cap-weighted index comprising sovereign, quasi-sovereign and corporate bonds and is partitioned by country, sector and credit rating. JACI includes bonds from the following countries: China, Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, South Korea and Thailand.
The MSCI All Country Asia ex Japan Index is a free float–adjusted market capitalization–weighted index of the stock markets of China, Hong Kong, India, Indonesia, Malaysia, Pakistan, Philippines, Singapore, South Korea, Taiwan and Thailand.
The MSCI All Country Asia Pacific Index is a free float–adjusted market capitalization–weighted index of the stock markets of Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Pakistan, Philippines, Singapore, South Korea, Taiwan and Thailand.
The MSCI China Index is a free float-adjusted market capitalization-weighted index of Chinese equities that includes H shares listed on the Hong Kong exchange, B shares listed on the Shanghai and Shenzhen exchanges, Hong Kong-listed securities known as Red chips (issued by entities owned by national or local governments in China) and P Chips (issued by companies controlled by individuals in China and deriving substantial revenues in China) and foreign listings (e.g. ADRs).
The MSCI China All Shares Index captures large and mid-cap representation across China A shares, B shares, H shares, Red chips (issued by entities owned by national or local governments in China), P chips (issued by companies controlled by individuals in China and deriving substantial revenues in China), and foreign listings (e.g. ADRs). The index aims to reflect the opportunity set of China share classes listed in Hong Kong,Shanghai, Shenzhen and outside of China.
The MSCI Emerging Markets (EM) Asia Index is a free float-adjusted market capitalization weighted index of the stock markets of China, India, Indonesia, Malaysia, Pakistan, Philippines, South Korea, Taiwan and Thailand. The MSCI Emerging Markets Index is a free float-adjusted market capitalization-weighted index of the stock markets of Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Malaysia, Mexico, Pakistan, Peru, Philippines, Poland, Qatar, Russia, Saudi Arabia, South Africa, South Korea, Taiwan, Thailand, Turkey and United Arab Emirates.
The MSCI Emerging Markets Index is a free float-adjusted market capitalization-weighted index of the stock markets of Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Malaysia, Mexico, Pakistan, Peru, Philippines, Poland, Qatar, Russia, Saudi Arabia, South Africa, South Korea, Taiwan, Thailand, Turkey and United Arab Emirates.
The S&P Bombay Stock Exchange 100 (S&P BSE 100) Index is a free float–adjusted market capitalization–weighted index of 100 stocks listed on the Bombay Stock Exchange.
The MSCI Japan Index is a free float–adjusted market capitalization–weighted index of Japanese equities listed in Japan.
The Korea Composite Stock Price Index (KOSPI) is a market capitalization–weighted index of all common stocks listed on the Korea Stock Exchange.
The MSCI All Country Asia ex Japan Small Cap Index is a free float–adjusted market capitalization–weighted small cap index of the stock markets of China, Hong Kong, India, Indonesia, Malaysia, Pakistan, Philippines, Singapore, South Korea, Taiwan and Thailand.
The MSCI China Small Cap Index is a free float-adjusted market capitalization-weighted small cap index of the Chinese equity securities markets, including H shares listed on the Hong Kong exchange, B shares listed on the Shanghai and Shenzhen exchanges,Hong Kong-listed securities known as Red Chips (issued by entities owned by national or local governments in China) and P Chips (issued by companies controlled by individuals in China and deriving substantial revenues in China), and foreign listings (e.g., ADRs).
The information contained herein has been derived from sources believed to be reliable and accurate at the time of compilation, but no representation or warranty (express or implied) is made as to the accuracy or completeness of any of this information. Neither the funds nor the Investment Advisor accept any liability for losses either direct or consequential caused by the use of this information.
The views and opinions in the commentary were as of the report date, subject to change and may not reflect current views. They are not guarantees of performance or investment results and should not be taken as investment advice. Investment decisions reflect a variety of factors, and the managers reserve the right to change their views about individual stocks, sectors, and the markets at any time. As a result, the views expressed should not be relied upon as a forecast of the Fund's future investment intent. It should not be assumed that any investment will be profitable or will equal the performance of any securities or any sectors mentioned herein. The information does not constitute a recommendation to buy or sell any securities mentioned.
Commentary
Period ended September 30, 2020
MEASX - Investor Class Commentary MIASX - Institutional Class CommentaryFor the quarter ending September 30, 2020, the Matthews Emerging Asia Fund returned 9.50% (Investor Class) and 9.55% (Institutional Class), while its benchmark, the MSCI Emerging Markets Asia Index, returned 12.07%.
Market Environment:
Equity markets in Bangladesh and Pakistan saw a strong rebound in the third quarter, following a tough start to the year. Investor sentiment strengthened on improving macroeconomic data, historically low equity price valuations and easing coronavirus fears. For Bangladesh and Pakistan, hopes for a V-shaped economic recovery are gaining momentum, and foreign exchange reserves are trending in a positive direction for both countries. Both Bangladesh and Pakistan continue to see strong remittances, in which family members living and working abroad send money home. While the number of new infections of coronavirus is rising in both Bangladesh and Pakistan, overall mortality rates have not gone up for either country. We see a similar trend in India, where infections are rising but overall mortality rates haven’t changed meaningfully. Youthful populations may partly explain the health resiliency of these countries amid the pandemic.
Equity markets in Indonesia were weak because the government had returned to extreme lockdowns related to the pandemic, which has been bad for the economy. Local investors in Indonesia have also generally been disappointed in president Joko Widodo’s handling of economic issues. Markets in Thailand were also weak amid political unrest related to an unpopular new king ascending to the throne. From a currency perspective, the Indian rupee, Pakistani rupee, Malaysian ringgit, and Philippine peso all appreciated relative to the U.S. dollar. In contrast, the Indonesian rupiah and Thai baht depreciated.
Performance Contributors and Detractors
A contributor to Fund performance during the quarter was British American Tobacco, a Bangladesh-based tobacco producer whose share price had previously been under pressure. In terms of tobacco sales, business as usual has resumed quickly in Bangladesh following the initial lockdowns related to the pandemic. The company’s earnings have improved recently and investor sentiment has gained strength. In addition, the company has launched a new business line exporting completed cigarettes to China. The cost of producing cigarettes in Bangladesh—both in terms of agriculture and labor—are lower than China, creating interesting export opportunities for the company. Elsewhere, Vietnamese fishery Vinh Hoan, was another contributor. The company produces and exports high-quality white fish fillets, mainly to the U.S. Improving sales numbers buoyed by premium products lifted the stock price.
Detractors included Thailand-based consumer discretionary company Central Retail and consumer staples company Thai Beverage. Their share prices declined amid broader negative local investor sentiment in Thailand but both companies remain stable businesses. Thailand is currently experiencing considerable political unrest related to their new king and military government, both of whom are unpopular among the country’s citizens. The market environment in Thailand has been very weak amid political demonstrations and unrest. Another detractor was Indonesian household goods producer Kino Indonesia amid poor investor sentiment toward Indonesian equities in the face of further lockdowns.
From a country perspective, stock selection in Pakistan and our overweight to Bangladesh and Vietnam contributed to relative performance. These markets experienced strong gains as their economies began to reopen. In contrast, our overweight to Indonesia and Thailand detracted from performance. Both markets were weak overall on political concerns.
Notable Portfolio Changes:
During the quarter, we added new positions in China, where there have been a number of new IPOs. We have historically been underweight China relative to the benchmark, and we expect to remain underweight looking ahead, as our focus remains on less developed markets within Asia. At the same time, we’ve added incrementally to our China holdings reflecting compelling bottom-up investment opportunities. For example, we initiated a new position in Xpeng, a Chinese electric vehicle (EV) maker with a strong focus on innovation and technology. China is a natural market for EVs in our view, as much of the rural parts of the country already use electric two wheelers. We also exited a few positions in the quarter among our microcap stocks, primarily on liquidity concerns.
Outlook:
Looking ahead, we expect many economies among less developed parts of Asia to begin to slowly return to normal. Interest among domestic investors in frontier equity markets picked up considerably in the quarter. As conditions on the ground have started to stabilize, we expect to see a corresponding recovery among equity prices in markets such as Pakistan, Vietnam and Bangladesh. Indonesia recently passed a new omnibus law, easing labor laws for employers and encouraging more foreign industrial investment. One country facing a potentially slower recovery is Sri Lanka, which faces twin deficits that include a current account deficit and budget deficit. The country is also quite dependent on tourism, which has dried up as global travel evaporated. On balance though, we remain optimistic about the long-term growth potential for less developed markets in Asia. Youthful workforces, rising consumption and attractive equity valuations make these markets very compelling to us on a long-term view.
As of 09/30/2020, the securities mentioned comprised the Matthews Emerging Asia Fund in the following percentages: British American Tobacco Bangladesh Co., Ltd., 3.7%; Vinh Hoan Corp., 4.7%; Central Retail Corp. Public Co., Ltd., 2.1%; Thai Beverage Public Co., Ltd., 2.2%; PT Kino Indonesia, 2.8%; XPeng, Inc. ADR, 2.1%. Current and future portfolio holdings are subject to change and risk.
Average Annual Total Returns - MEASX as of 12/31/2020
All performance quoted is past performance and is no guarantee of future results. Investment return and principal value will fluctuate with changing market conditions so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the return figures quoted. Returns would have been lower if certain of the Fund's fees and expenses had not been waived. Please see the Fund's most recent month-end performance.
Fees & Expenses
Matthews has contractually agreed (i) to waive fees and reimburse expenses to the extent needed to limit Total Annual Fund Operating Expenses (excluding Rule 12b-1 fees, taxes, interest, brokerage commissions, short sale dividend expenses, expenses incurred in connection with any merger or reorganization or extraordinary expenses such as litigation) of the Institutional Class (which is offered through a separate prospectus to eligible investors) to 1.20%, first by waiving class specific expenses (e.g., shareholder service fees specific to a particular class) of the Institutional Class and then, to the extent necessary, by waiving non-class specific expenses (e.g., custody fees) of the Institutional Class, and (ii) if any Fund-wide expenses (i.e., expenses that apply to both the Institutional Class and the Investor Class) are waived for the Institutional Class to maintain the 1.20% expense limitation, to waive an equal amount (in annual percentage terms) of those same expenses for the Investor Class. The Total Annual Fund Operating Expenses After Fee Waiver and Expense Reimbursement for the Investor Class may vary from year to year and will in some years exceed 1.20%. If the operating expenses fall below the expense limitation in a year within three years after Matthews has made a waiver or reimbursement, the Fund may reimburse Matthews up to an amount that does not cause the expenses for that year to exceed the lesser of (i) the expense limitation applicable at the time of that fee waiver and/or expense reimbursement or (ii) the expense limitation in effect at the time of recoupment. This agreement will remain in place until April 30, 2021 and may be terminated at any time by the Board of Trustees on behalf of the Fund on 60 days’ written notice to Matthews. Matthews may decline to renew this agreement by written notice to the Trust at least 30 days before its annual expiration date.