Matthews Launches New Discovery Active ETFs Focused on Smaller Companies With Innovative and Entrepreneurial Business Models

San Francisco, January 11, 2024 — Matthews introduced two new active ETFs, the Matthews Emerging Markets Discovery Active ETF (MEMS) and the Matthews China Discovery Active ETF (MCHS) on the Nasdaq Stock Exchange today, adding the ‘power of choice’ for investors to the firm’s active ETF suite of 12 funds.

The new Discovery Active ETFs provide investors with actively managed exposure to a broad range of smaller companies across Emerging Markets and China, many of which are at the heart of key secular trends. These include fast-growing entrepreneurial businesses that we believe are benefiting from both established and newly emerging domestic sectors. 

As many of these companies are less well-known, they can operate under the radar of market participants and may be undervalued. Through active, in-depth fundamental research and considered portfolio construction, Matthews believes smaller companies in Emerging Markets may offer a compelling investment opportunity, while providing diversification.

The Matthews Emerging Markets Discovery Active ETF (MEMS) will be run by the same investment team and with a similar investment approach as the Matthews Emerging Market Small Companies Fund that has generated strong performance, but, it is a separate and distinct strategy. The Matthews China Discovery Active ETF (MCHS) will have the same investment team and a similar approach as the Matthews China Small Companies Fund, which has also generated strong performance, but is a separate and distinct strategy. 

Cooper Abbott, CEO of Matthews, commented: “As a fundamental, research-driven firm with strong risk awareness, Matthews has been at the forefront of finding undiscovered Emerging Market companies that could provide investors with unique exposure to new growth and diversification opportunities. Our Discovery Active ETFs leverage Matthews’ deep expertise in      smaller companies that can potentially provide more exposure to new business models, domestic markets, and innovative companies that can be growing quickly. Matthews Discovery Active ETFs give investors differentiated exposures to potentially under-researched companies typically not found in broad, larger-cap emerging market or international strategies. These new Active ETFs build on our commitment to providing investors with the ‘power of choice’ to selectively express their investment views—both strategically and tactically—and build portfolios with more tailored emerging market exposures that complement their existing portfolios.” 

Vivek Tanneeru, Lead Manager of the Matthews Emerging Markets Discovery Active ETF commented: “Emerging markets, in our view, offer investors a rich landscape for smaller companies. These businesses can potentially provide access to higher-growth domestic sectors as well as newly emerging sectors that develop as markets deepen and entrepreneurialism grows. Given their low research coverage and diversity, we believe small companies in emerging markets can present compelling alpha opportunities for active managers.” 

Andrew Mattock, CFA, Lead Manager of the Matthews China Discovery Active ETF commented: “Matthews has a long history of investing in China and in our experience, investing in the initial stages of a company’s growth can potentially offer an attractive investment opportunity. Smaller companies in China often provide opportunities for higher growth in entrepreneurial businesses that offer exposure to emerging business models that can quickly adapt to local market needs.”

Matthews Active ETFs provide investors actively-managed expertise with increased tax efficiency and intra-day liquidity:

Emerging Markets & Asia:
-    Matthews Emerging Markets Equity Active ETF (MEM)
-    Matthews Emerging Markets ex China Active ETF (MEMX)
-    Matthews Emerging Markets Discovery Active ETF (MEMS)
-    Matthews Emerging Markets Sustainable Future Active ETF (EMSF)
-    Matthews Asia Innovators Active ETF (MINV)
-    Matthews Pacific Tiger Active ETF (ASIA)
-    Matthews Asia Dividend Active ETF (ADVE)

Country Specific:
-    Matthews China Active ETF (MCH) 
-    Matthews China Discovery Active ETF (MCHS)
-    Matthews India Active ETF (INDE)
-    Matthews Japan Active ETF (JPAN)
-    Matthews Korea Active ETF (MKOR) 

About Matthews:
Matthews is an independent, privately owned investment manager founded in 1991 on a belief that Global Emerging Markets offer exceptional long-term growth and diversification potential for investors. As a trusted and experienced guide, Matthews takes a long-term, active, fundamental investment approach to construct highly differentiated portfolios that focus on Emerging Markets, Asia and China. The firm manages assets on behalf of institutions, advisors and individual investors globally in vehicles that include SMAs, mutual funds and active ETFs. For more information about Matthews, please visit matthewsasia.com.

Media Contacts:

Dukas Linden PR
Sarah Lazarus/Christian Healy
+617-335-7823/+781-439-2500
sarah@dlpr.com/christian@dlpr.com

You should carefully consider the investment objectives, risks, charges and expenses of the Matthews Asia Funds before making an investment decision. A prospectus with this and other information about the Funds may be obtained by visiting matthewsasia.com. Please read the prospectus carefully before investing. 

The value of an investment in the Fund can go down as well as up and possible loss of principal is a risk of investing. Investments in international, emerging and frontier markets involve risks such as economic, social and political instability, market illiquidity, currency fluctuations, high levels of volatility, and limited regulation. Investing in small- and mid-size companies can entail additional risks than investing in larger companies as they may be more volatile and less liquid than large cap companies. In addition, single-country portfolios may be subject to a higher degree of market risk than diversified funds because of concentration in a specific country.

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

Past performance is no guarantee of future results.