12/27/1999
Inception Date
27.54%
YTD Return
(as of 10/16/2026)
$21.49
NAV
(as of 10/16/2026)
-0.41
1 Day NAV Change
(as of 10/16/2026)
Long-term capital appreciation
Under normal circumstances, the Matthews Asia Innovators 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 that Matthews believes are innovators in their products, services, processes, business models, management, use of technology, or approach to creating, expanding or servicing their markets. 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.
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. Sector funds may be subject to a higher degree of market risk than diversified funds because of a concentration in a specific sector. The Fund's value may be affected by changes in the science and technology-related industries. Non-diversified funds may be more susceptible to any single economic, political or regulatory event than a diversified fund because a higher percentage of a fund’s assets may be invested in the securities of a limited number of issuers.
These and other risks associated with investing in the Fund can be found in the prospectus.
| Inception Date | 12/27/1999 | |
| Fund Assets | $683.03 million (09/30/2026) | |
| Currency | USD | |
| Ticker | MATFX | |
| Cusip | 577-130-883 | |
| Benchmark | MSCI All Country Asia ex Japan Index | |
| Geographic Focus | Asia - Consists of all countries and markets in Asia, including developed, emerging, and frontier countries and markets in the Asian region | |
| Gross Expense Ratio | 1.27% | |
| Objective | Long-term capital appreciation |
| Strategy | Under normal circumstances, the Matthews Asia Innovators 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 that Matthews believes are innovators in their products, services, processes, business models, management, use of technology, or approach to creating, expanding or servicing their markets. 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. Sector funds may be subject to a higher degree of market risk than diversified funds because of a concentration in a specific sector. The Fund's value may be affected by changes in the science and technology-related industries. Non-diversified funds may be more susceptible to any single economic, political or regulatory event than a diversified fund because a higher percentage of a fund’s assets may be invested in the securities of a limited number of issuers.
The risks associated with investing in the Fund can be found in the prospectus |
MSCI AC Asia Ex Japan Index since inception value calculated from 12/31/99.
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.
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.
(as of 09/30/2026)
CATEGORY: Pacific/Asia ex-Japan Stk
| OVERALL | 3 stars | out of 37 funds |
| 3 YEAR | 4 stars | out of 37 funds |
| 5 YEAR | 2 stars | out of 35 funds |
| 10 YEAR | 4 stars | out of 30 funds |
Ratings agency calculation methodology
Past performance is no guarantee of future results. High ratings and rankings does not assure favorable performance.
The Overall Morningstar® Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and (if applicable) ten-year ratings.
Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
Portfolio Manager
Tiffany Hsiao is a Portfolio Manager at Matthews. She originally joined Matthews in April 2014 and departed in August 2020 to launch a China-focused private fund at Artisan Partners. Prior to her departure, Tiffany managed the firm’s China Small Companies, former Asia Small Companies (now Emerging Markets Small Companies) and Asia Innovators strategies. Previously, she was a Vice President at Goldman Sachs Investment Partners in Hong Kong and Tokyo from 2007 to 2013, responsible for Asia Pacific investments with an emphasis on equities in China. Previous to this, she spent six years at Franklin Templeton Investments, where she managed the firm’s global communications fund. Tiffany earned her Master of Science and Information Technology from Carnegie Mellon University and received a B.A. in Economics from the University of California, Berkeley. She is fluent in Mandarin and Taiwanese, and conversational in Cantonese.
Sources: Factset Research Systems, Inc.
Fund Risk Metrics are reflective of Investor share class.
Source: FactSet Research Systems
Top 10 holdings may combine more than one security from the same issuer and related depositary receipts.
Source: BNY Mellon Investment Servicing (US) Inc.
Sector data based on MSCI’s revised Global Industry Classification Standards. For more details, visit www.msci.com.
Not all countries are included in the benchmark index(es).
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.
Visit our Glossary of Terms page for definitions and additional information.
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 MSCI Emerging Markets ex China Index is a free float-adjusted market capitalization-weighted index that captures large and mid cap representation across 23 of the 24 Emerging Markets (EM) countries excluding China: Brazil, Chile, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Kuwait, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Saudi Arabia, South Africa, Taiwan, Thailand, Turkey and United Arab Emirates.
The MSCI Emerging Markets Small Cap Index is a free float-adjusted market capitalization weighted small cap index of the stock markets of Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungry, India, Indonesia, Kuwait, 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 MSCI India Index is a free float-adjusted market capitalization-weighted index of Indian equities listed in India.
The MSCI Korea Index is a free float-adjusted market capitalization-weighted index of Korean equities listed in Korea.
The MSCI Korea 25/50 Index is designed to measure the performance of the large and mid cap segments of the Korean market. It applies certain investment limits that are imposed on regulated investment companies, or RICs, under the current US Internal Revenue Code.
Indexes are for comparative purposes only and it is not possible to invest directly in an index.
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, 2026
Summary
Market Review
Asian equity markets declined marginally in the third quarter, with returns varying across countries and sectors. The period was characterized by profit-taking in AI-related semiconductor names, a rotation toward Chinese internet companies and Hong Kong equities, and continued monetary tightening by the Bank of Japan. Higher oil prices, rising U.S. yields, geopolitical tensions, and uncertainty around global trade also influenced investor sentiment.
Technology shares, particularly AI-related semiconductor companies, experienced a meaningful correction during the period. South Korea was among the hardest-hit markets, with the KOSPI declining more than -16% in July, triggering numerous trading halts before partially recovering in August. Investor concerns included elevated AI-related valuations and competition in memory chips. In Taiwan, sentiment remained relatively resilient despite concerns about a potential AI bubble. Exports from both Taiwan and South Korea continued to benefit from strong chip and technology shipments throughout the quarter.
China remained challenged by weak domestic demand, ongoing property-sector weakness and softer-than-expected economic growth. However, equity markets responded positively to incremental policy support, with investor interest shifting toward Chinese internet platforms, financials, and Hong Kong-listed equities. India lagged regional peers as higher oil prices, foreign capital outflows, currency pressure, and a firm policy stance weighed on investor sentiment.
Elsewhere, Australia and Japan delivered solid mid-single-digit returns, broadly in line with regional benchmarks. Japanese equities navigated continued monetary tightening by the Bank of Japan, while Australian markets benefited from relatively stable earnings and commodity exposure.
Performance
For the quarter ended September 30, 2026, the Matthews Asia Innovators Fund returned -16.42%, (Investor Class) and -16.38% (Institutional Class) while its benchmark, the MSCI All Country Asia ex Japan Index, returned -0.23% over the same period. The shortfall was driven primarily by selection in Taiwan, South Korea, and China. By sector, information and technology and industrials detracted from performance. Positive contributions from Taiwanese semiconductor companies and selected consumer and health care holdings only partly offset these declines.
Regional Performance
South Korea
South Korea detracted from performance led by information technology. Samsung Electro-Mechanics declined -24% and was the largest detractor. The company supplies multilayer ceramic capacitors and semiconductor package substrates used in computing and AI infrastructure. While second-quarter operating profit was supported by demand for AI-server components, results fell short of elevated market expectations, and the shares sold off alongside Korean technology stocks. We continue to see longer-term opportunity in high-value capacitors and advanced substrates, but reduced the position as near-term expectations appeared to be ahead of fundamentals.
SK Hynix, a leading producer of memory and high-bandwidth memory for AI systems, pulled back by -27%. Although the holding detracted from absolute performance, the portfolio’s underweight position contributed positively on a relative basis. Record revenue was offset by an operating profit below market expectations, contributing to a July selloff across Korean memory shares. The stock recovered from its trough as investors refocused on the AI capital-spending cycle, high bandwidth memory (HBM) demand and planned shareholder returns, but the recovery did not fully offset the earlier decline.
Taiwan
Taiwan detracted from performance during the quarter. Kaori Heat Treatment, which produces thermal-management systems, including liquid-cooling components for AI servers, declined -49% and was the principal Taiwanese detractor. While we continue to like the long-term AI liquid-cooling opportunity, we reduced our exposure on rising U.S. data center buildout concerns and as part of a broader reduction in Information Technology exposure; and we reallocated capital to areas where we viewed more attractive risk/reward opportunities.
We also exited United Microelectronics, which retreated by -23% during the quarter. The mature- and specialty-node foundry maker reported improving utilization and announced additional investment but concerns about potential dilution from a convertible-bond issuance weighed on investor sentiment.
These declines were partly offset by MediaTek and ASPEED Technology. MediaTek, Taiwan’s leading fabless semiconductor company, gained 14% as earnings exceeded expectations and investors focused on its developing data-center and custom AI chip opportunities. ASPEED, a chipmaker that specializes in server management, rose 22%, supported by revenue growth reflecting continued demand for server-management chips across both conventional and AI servers.
China
China was the largest detractor to performance, primarily due to semiconductor equipment holdings. NAURA Technology declined -30%, while Advanced Micro-Fabrication Equipment fell -32%. Both companies are leading domestic suppliers of semiconductor manufacturing equipment and remain positioned to benefit from China’s efforts to localize critical technology in our view. During the quarter, however, the shares were affected by a broader rotation away from AI-related hardware and the continuing impact of U.S. export restrictions; we slightly reduced our exposure to both names.
India
India was mixed. MTAR, a high-precision engineering and manufacturing company, is positioned to benefit from accelerating AI power infrastructure spending, fuel-cell deployment, nuclear expansion, and aerospace supply-chain diversification in our view. Its share price pulled back by -29% due to investor concerns regarding the pace of a key client ramp-up and the conversion of its backlog to revenues. Delivering better performance was Lenskart Solutions, an omnichannel eyewear retailer with an integrated model spanning design, manufacturing and retail, which increased by 31%, making it a leading contributor. The company benefited from continued investor interest in India’s consumption growth and the company’s potential to gain share in the organized eyewear market.
Positioning
In July, we rebalanced the portfolio, taking profit in select Information Technology holdings following strong performance and reallocated capital towards more attractively valued innovation adopters across Consumer, Industrials and Health Care. We maintained a sizable allocation to Information Technology, focused on long-term, high-conviction China AI infrastructure holdings. These adjustments helped the portfolio navigate August steadily. Geopolitics were a minor detractor during August as the United States announced plans to restrict the imports of Chinese optical communication transceiver modules for use in U.S. data centers. We reduced exposure to South Korea and Taiwan while increasing allocations to China and India.
Among the quarter’s additions were Eternal Limited and NetEase. Eternal Limited (Zomato) operates one of India's leading digital consumer platforms, including food delivery, quick commerce, going-out services, and restaurant supply businesses. NetEase is one of China's leading online gaming companies with a portfolio of established franchises, growing international reach, and increasing exposure to AI-enabled content creation and distribution. We believe these businesses provide exposure to the continued digital consumption across India and China.
Other notable changes included reduced exposure to several South Korean and Taiwanese technology holdings and increased allocations to selected Chinese Consumer, Industrial and Real Estate companies, as well as Indian Consumer businesses.
Outlook
Near-term conditions remain influenced by the direction of U.S. monetary policy, elevated energy prices, geopolitical developments and political and fiscal uncertainty across key emerging markets. Technology and renewable-energy companies may remain volatile through the U.S. midterm election period and as China tightens enforcement of certain tax measures.
During August and early September, our investment team conducted research across Silicon Valley, Hong Kong, Shenzhen, Shanghai, Wuxi and Taipei, meeting with companies in AI, renewable energy, automation, semiconductors and consumer-related industries. Discussions with portfolio companies, as well as their public and private peers and competitors, further strengthened our conviction in selected portfolio holdings and watchlist candidates.
We see continued progress in China’s AI technology localization and Taiwan’s advanced packaging and optical communications advancement. Automation and renewable energy companies are benefiting from demand associated with semiconductor capacity expansion, as well as opportunities arising from broader supply chain diversification and geographic relocation.
China’s consumer and real estate sectors continue to experience a gradual and uneven recovery. Nevertheless, our research reinforced our conviction in selected consumer holdings and identified opportunities among companies that have navigated the downturn and strengthened their competitive positions. These opportunities span home appliances, travel, leisure, and consumer services.
Looking ahead, we expect volatility in technology, healthcare, and renewable energy to persist through November, amid the U.S. midterm elections and tighter enforcement of tax measures in China. We expect to use periods of market weakness selectively to add to high-conviction positions where fundamentals and valuations remain attractive. We thank our clients for their continued support during this period of market volatility.
View the Fund's Top 10 holdings as of September 30, 2026. Current and future holdings are subject to change and risk.
Average Annual Total Returns - MATFX as of 09/30/2026
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. For the Fund's most recent month-end performance visit matthewsasia.com
Fees & Expenses
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. Sector funds may be subject to a higher degree of market risk than diversified funds because of a concentration in a specific sector. The Fund's value may be affected by changes in the science and technology-related industries. Non-diversified funds may be more susceptible to any single economic, political or regulatory event than a diversified fund because a higher percentage of a fund’s assets may be invested in the securities of a limited number of issuers.