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Matthews China Discovery Active ETF
MCHS

Snapshot
  • Seeks alpha in China’s lesser known small entrepreneurial companies
  • Invests in industries that are leveraged to China’s increasingly innovative and dynamic economy driven by fast growing domestic consumer demand
  • Tilt towards higher value-added growth sectors benefiting from innovation and capital efficiency

01/10/2024

Inception Date

n.a.

NAV YTD Return

(as of 06/17/2024)

$26.56

NAV

(as of 06/17/2024)

-0.17

1 Day NAV Change

(as of 06/17/2024)

Objective

Long-term capital appreciation.

Strategy

Under normal circumstances, the Matthews China Discovery Active ETF seeks to achieve its investment objective by investing at least 65% of its net assets, which include borrowings for investment purposes, in the common and preferred stocks of Small Companies (defined below). The remainder of the portfolio will be comprised of other investments that facilitate the investment strategy, and Matthews expects that the remainder of the portfolio will be comprised of mid-capitalization companies. In addition, at least 80% of the Fund’s net assets, which includes borrowings for investment purposes, will be invested in the common and preferred stocks of companies located in China. China includes its administrative and other districts, such as Hong Kong. The Fund may also invest in companies located outside of China; however, the Fund may not invest in any company located outside of China if, at the time of purchase, more than 20% of the Fund’s assets are invested in companies located outside of China. The Fund is non-diversified, which means that it may invest its assets in a smaller number of issuers than a diversified fund.

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 markets involves different and greater risks, as these countries are substantially smaller, less liquid and more volatile than securities markets in more developed markets. In addition, investments in a single-country fund, which is considered a non-diversified fund, may be subject to a higher degree of market risk than diversified funds because of concentration in a specific country. The Fund is non-diversified as it concentrates its investments in small sized companies. Investing in small- and mid-size companies is more risky and volatile than investing in large companies as they may be more volatile and less liquid than larger companies. The ETF is new with a limited history.

These and other risks associated with investing in the Fund can be found in the prospectus.

Fund Facts
Inception Date 01/10/2024
Fund Assets $2.12 million (06/18/2024)
Currency USD
Ticker MCHS
Cusip 577-125-735
Primary Exchange NASDAQ
Benchmark MSCI China Small Cap Index
Geographic Focus China - China includes its administrative and other districts, such as Hong Kong
Fees & Expenses
Gross Expense Ratio 0.99%
Net Expense Ratio 0.89%

NAV & Market Price

(as of 06/17/2024)
NAV $26.56
NAV Change -0.17
Market Price $26.76
Market Price Change -0.06
Day's Trading Volume 2 Shares
Median BID/ASK Spread (30 Day) 0.41% (as of 06/17/2024)
Premium Discount +0.75%
Number of days at Premium/Discount
2024
Q2 Q1
Premium 45 49
Discount 9 5

The NAV of an ETF represents the value of all the securities held by the ETF such as shares or bonds and cash minus any liabilities such as Total Expense Ratio (TER), and divided by the number of shares outstanding. An ETF’s market price is the price at which investors can buy or sell an ETF on an exchange. This price may deviate from the NAV of the ETF depending on demand for and supply for the ETF at a point in time.

The Premium/Discount chart shows the difference between the daily market price of the Fund’s shares and the Fund’s net asset value (“NAV”). The daily market price is calculated using the mid-point between the highest bid and the lowest offer on the listing exchange, as of the time that the Fund’s NAV is calculated (usually 4:00 pm Eastern time). The vertical axis of the chart shows the premium or discount of the Mid-Point price as a percentage of the NAV. The horizontal axis shows the number of trading days covered by the chart, and each bar in the chart demonstrates how many days the Fund traded within the given premium/discount range. The data presented in the chart and table above represent past performance and cannot be used to predict future results.

ETFs may trade at a premium or discount to NAV. Shares of any ETF are bought and sold at market prices (not NAV) and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.

Performance

  • Monthly
  • Quarterly
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As of 05/31/2024
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews China Discovery Active ETF - MCHS
01/10/2024
NAV
1.02% 4.44% n.a. n.a. n.a. n.a. n.a. 7.36%
Market Price
2.23% 5.46% n.a. n.a. n.a. n.a. n.a. 8.20%
MSCI China Small Cap Index
3.33% 8.13% n.a. n.a. n.a. n.a. n.a. 5.85%
As of 03/31/2024
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews China Discovery Active ETF - MCHS
01/10/2024
NAV
-1.05% n.a. n.a. n.a. n.a. n.a. n.a. 1.72%
Market Price
-0.39% n.a. n.a. n.a. n.a. n.a. n.a. 2.20%
MSCI China Small Cap Index
0.27% n.a. n.a. n.a. n.a. n.a. n.a. -1.84%

The Fund's primary benchmark index is the MSCI China Index on marketing materials that display performance

Source: BNY Mellon Investment Servicing (US) Inc. All performance is in US$.

Year to Date and Since Inception performance with less than one year of history represents actual performance, not annualized.

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.

Net asset value (“NAV”) returns are based on the dollar value of a single share of the ETF, calculated using the value of the underlying assets of the ETF minus its liabilities, divided by the number of shares outstanding. The NAV is typically calculated at 4:00 pm Eastern time on each business day the New York Stock Exchange is open for trading. Market returns are based on the trade price at which shares are bought and sold on the NYSE Arca, Inc. using the last share trade. Market performance does not represent the returns you would receive if you traded shares at other times. Total Return reflects the reinvestment of distributions on ex-date for NAV returns and payment date for Market Price returns. The market price of the ETF’s shares may differ significantly from their NAV during periods of market volatility.

Top 10 Holdings

(as of 06/20/2024)
Ticker Name SEDOL Market Value Shares % Net Assets
YZJSGD YANGZIJIANG SHIPBUILDING HOLDINGS, LTD. B1VT035 $93,666 51,900 4.4
2669 CHINA OVERSEAS PROPERTY HOLDINGS, LTD. BYYMZN7 $93,596 140,000 4.4
2367 GIANT BIOGENE HOLDING CO BNNJRV4 $73,212 12,400 3.5
002353 YANTAI JEREH OILFIELD-A BD5CMC7 $70,975 14,300 3.4
600885 HONGFA TECHNOLOGY CO LTD- BYQDM93 $67,074 16,300 3.2
921 HISENSE HOME APPLIANCES G 6391935 $58,990 14,000 2.8
ACMR ACM RESEARCH INC-CLASS A BF5C2N2 $55,624 2,309 2.6
603816 JASON FURNITURE HANGZHOU BYW5R09 $53,730 11,600 2.5
BZ KANZHUN LTD - ADR BM91SH0 $53,222 2,600 2.5
780 TONGCHENG TRAVEL HOLDINGS BGM5R25 $52,478 25,200 2.5
2423 KE HOLDINGS INC-CL A BN7SX97 $50,845 10,000 2.4
9979 GREENTOWN MANAGEMENT HOLD BKWGV13 $50,000 61,000 2.4
600803 ENN NATURAL GAS CO LTD-A BYYFJJ0 $49,660 17,200 2.3
YMM FULL TRUCK ALLIANCE -SPN BMD2L36 $49,381 5,499 2.3
ATAT ATOUR LIFESTYLE HOLDINGS- BLN9P16 $43,938 2,441 2.1
9899 CLOUD MUSIC INC BP2TRS6 $43,907 3,500 2.1
002472 ZHEJIANG SHUANGHUAN DRIVE BP91M35 $43,392 13,300 2.0
3035 FARADAY TECHNOLOGY CORP. 6186045 $42,591 4,231 2.0
2383 ELITE MATERIAL CO., LTD. 6316121 $41,779 3,000 2.0
1910 SAMSONITE INTERNATIONAL S.A. B4Q1532 $40,372 13,500 1.9
603345 ANJOY FOODS GROUP CO LTD- BMXWM11 $40,080 3,700 1.9
603198 ANHUI YINGJIA DISTILLERY BYV1VH3 $38,275 4,600 1.8
002851 SHENZHEN MEGMEET ELECTRIC BHQPRT5 $38,025 9,600 1.8
2155 MORIMATSU INTERNATIONAL H BNKLJ40 $37,557 51,000 1.8
1896 MAOYAN ENTERTAINMENT BHHD4Q4 $36,841 32,800 1.7
000400 XUJI ELECTRIC CO LTD-A BD5CJB5 $36,831 7,900 1.7
1308 SITC INTERNATIONAL HOLDINGS CO., LTD. B61X7R5 $35,713 13,000 1.7
123 YUEXIU PROPERTY CO LTD BNR5PB4 $32,447 45,000 1.5
6990 SICHUAN KELUN-BIOTECH BIO BPXZ192 $32,131 1,400 1.5
257 CHINA EVERBRIGHT INTERNATIONAL, LTD. 6630940 $31,962 68,000 1.5
603883 LAOBAIXING PHARMACY CHAIN BYZW4H3 $31,925 7,800 1.5
300487 SUNRESIN NEW MATERIALS CO BHQPSB4 $31,714 5,100 1.5
603589 ANHUI KOUZI DISTILLERY CO BYQDNL2 $31,700 5,700 1.5
13 HUTCHMED CHINA LTD BNTDT81 $30,536 8,500 1.4
1405 DPC DASH LTD BQXQK73 $29,744 3,900 1.4
1789 AK MEDICAL HOLDINGS, LTD. BFD6SZ0 $28,337 46,000 1.3
425 MINTH GROUP, LTD. B0RJCG9 $28,197 16,000 1.3
2588 BOC AVIATION LTD BYZJV17 $28,150 4,000 1.3
1368 XTEP INTERNATIONAL HOLDIN B2RJYH8 $27,354 43,500 1.3
300856 NANJING COSMOS CHEMICAL C BNHPGN3 $27,260 5,500 1.3
1208 MMG, LTD. 6728793 $26,926 72,000 1.3
934 SINOPEC KANTONS HOLDINGS, LTD. 6162692 $26,506 52,000 1.3
600529 SHANDONG PHARMACEUTICAL - BMVB2W1 $26,015 7,400 1.2
189 DONGYUE GROUP B29MXW3 $25,951 23,000 1.2
3990 MIDEA REAL ESTATE HOLDING, LTD. BF55Q06 $23,873 46,600 1.1
3324 AURAS TECHNOLOGY CO LTD B015YP6 $23,066 1,000 1.1
1888 KINGBOARD LAMINATES HLDG B1HHFV6 $21,827 19,000 1.0
2192 MEDLIVE TECHNOLOGY CO LTD BN7RMD1 $19,875 20,500 0.9
6415 SILERGY CORP. BH4DMW9 $15,748 1,000 0.7
3888 KINGSOFT CORP., LTD. B27WRM3 $15,338 4,800 0.7
268 KINGDEE INTERNATIONAL SOFTWARE GROUP CO., LTD. 6327587 $14,075 14,000 0.7
002557 CHACHA FOOD CO LTD-A BD5LW57 $14,041 3,500 0.7
6533 ANDES TECHNOLOGY CORP BWT3K58 $13,278 1,000 0.6
300012 CENTRE TESTING INTERNATIONAL GROUP CO., LTD. A SHARES B4VM756 $10,853 7,000 0.5
9996 PEIJIA MEDICAL LTD BMT7V13 $10,312 22,000 0.5
3900 GREENTOWN CHINA HOLDINGS B17N9P6 $10,186 11,000 0.5
1585 YADEA GROUP HOLDINGS LTD BZ04KX9 $9,206 6,000 0.4
ZH ZHIHU INC - ADR BQSB1R0 $7,975 2,731 0.4
CASH CASH AND OTHERS $15,845 0.7
CURR CNY $4,005 0.2
CURR HKD $86 0.0
TOTAL 31.8

Portfolio Breakdown (%)

(as of 03/31/2024)
  • Sector Allocation
  • Market Cap Exposure
  • China Exposure
Sector Fund Benchmark Difference
Consumer Discretionary 19.2 11.6 7.6
Industrials 17.0 13.0 4.0
Information Technology 15.6 9.9 5.7
Consumer Staples 9.3 6.6 2.7
Health Care 8.6 22.2 -13.6
Communication Services 7.6 8.7 -1.1
Real Estate 6.1 7.9 -1.8
Energy 3.7 1.5 2.2
Materials 3.5 10.3 -6.8
Utilities 2.6 3.8 -1.2
Financials 2.4 4.5 -2.1
Cash and Other Assets, Less Liabilities 4.4 0.0 4.4

Sector data based on MSCI’s revised Global Industry Classification Standards. For more details, visit www.msci.com.

Equity market cap of issuer Fund Benchmark Difference
Mega Cap (over $25B) 0.0 0.0 0.0
Large Cap ($10B-$25B) 2.3 0.0 2.3
Mid Cap ($3B-$10B) 52.8 2.8 50.0
Small Cap (under $3B) 40.5 97.2 -56.7
Cash and Other Assets, Less Liabilities 4.4 0.0 4.4
China Exposure Portfolio Weight
Hong Kong Listed Companies 44.1
Mainland China Listed Companies 24.6
Other 21.5
ADR/GDR 5.3
Cash and Other Assets, Less Liabilities 4.4

Mainland China listed companies includes A Share and B Shares. A Shares are Mainland Chinese companies incorporated in China and listed on the Shanghai or Shenzhen exchanges, available mostly to local Chinese investors and qualified institutional investors. B Shares are mainland Chinese companies listed on the Shanghai and Shenzhen stock exchanges, available to both Chinese and non-Chinese investors. ADRs are American Depositary Receipts and GDRs are Global Depositary Receipts. Hong Kong Listed Companies include SAR (Hong Kong) companies, China-affiliated corporations, and H Shares. SAR companies are companies that conduct business in Hong Kong and/or mainland China. China-affiliated corporations [CAC], also known as "Red Chips," are mainland China companies with partial state ownership listed in Hong Kong, and incorporated in Hong Kong. H Shares are mainland Chinese companies listed on the Hong Kong exchange but incorporated in mainland China. Other represents Chinese companies listed in other countries or non-China companies with a majority of revenue coming from China such as Japan, Singapore, Taiwan and the United States or other non-China companies.

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.

Portfolio Characteristics

(as of 03/31/2024)
Fund Benchmark
Number of Positions 48 241
Weighted Average Market Cap $4.1 billion $1.4 billion
Active Share 93.9 n.a.
P/E using FY1 estimates 13.1x 7.4x
P/E using FY2 estimates 11.5x 6.4x
Price/Cash Flow 11.5 4.1
Price/Book 2.4 0.6
Return On Equity 17.4 5.1
EPS Growth (3 Yr) 23.9% 7.1%

Sources: Factset Research Systems, Inc.

Portfolio Managers

Andrew  Mattock, CFA photo
Andrew Mattock, CFA

Lead Manager

Winnie  Chwang photo
Winnie Chwang

Lead Manager

Sherwood  Zhang, CFA photo
Sherwood Zhang, CFA

Co-Manager

Hardy  Zhu photo
Hardy Zhu

Co-Manager

 

Visit our Glossary of Terms page for definitions and additional information.

Index Definitions

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.