ASIA targets the fastest-growing economies in Asia ex-Japan through active stock selection, focusing on companies benefiting from rising consumer spending and technological advancement across China, India, and Southeast Asia.
How It Works
Matthews employs bottom-up fundamental analysis to identify quality growth companies across market caps, with flexibility to pivot between countries based on macro conditions. The fund typically holds 50-80 positions and can tactically adjust country weights, unlike passive Asia indices that are often 30%+ weighted to China regardless of fundamentals.
Key Features
- Active management allows underweighting China when needed, unlike passive funds stuck with index weights
- Access to mid-cap growth stories often missed by large-cap focused Asia indices
- Matthews' 30+ year Asia focus provides local research depth most US managers lack
Risks
- China regulatory crackdowns can crater 20-30% of portfolio value in weeks, as seen in 2021
- Currency swings can erase 10-15% returns annually when dollar strengthens
- Geopolitical tensions (Taiwan, South China Sea) could trigger sudden 30%+ drawdowns
Who Should Own This
Best for investors wanting emerging market growth but concerned about China concentration in passive funds. Works as a 5-10% satellite holding for those comfortable with volatility in exchange for access to the world's fastest GDP growth. Not suitable for anyone who can't stomach periodic 20%+ declines.