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Matthews Pacific Tiger Fund
MAPTX

Snapshot
  • Seeks alpha in Asia’s emerging economies by capitalizing on the rising Asia consumer
  • High-conviction equity portfolio focused on sustainable growth companies
  • All-cap fundamental approach driven by on-the-ground, proprietary research

09/12/1994

Inception Date

-1.29%

YTD Return

(as of 06/07/2023)

$19.90

NAV

(as of 06/07/2023)

-0.10

1 Day NAV Change

(as of 06/07/2023)

Objective

Long-term capital appreciation

Strategy

Under normal circumstances, the Matthews Pacific Tiger 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 Ex Japan. 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.

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

Fund Facts
Inception Date 09/12/1994
Fund Assets $3.61 billion (05/31/2023)
Currency USD
Ticker MAPTX
Cusip 577-130-107
Portfolio Turnover 5.6%
Benchmark MSCI All Country Asia ex Japan Index
Geographic Focus Asia Ex Japan - Consists of all countries and markets in Asia, including developed, emerging, and frontier countries and markets in the Asian region, excluding Japan
Fees & Expenses
Gross Expense Ratio 1.10%
Net Expense Ratio 1.09%

Performance

  • Monthly
  • Quarterly
  • Calendar Year
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As of 05/31/2023
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Pacific Tiger Fund - MAPTX
09/12/1994
MAPTX
-4.36% -5.62% -4.12% -11.42% 2.61% -1.16% 3.47% 7.19%
MSCI All Country Asia ex Japan Index
-1.81% -0.47% 0.38% -7.72% 3.30% -0.28% 3.90% 4.00%
As of 03/31/2023
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Pacific Tiger Fund - MAPTX
09/12/1994
MAPTX
2.69% 4.32% 4.32% -6.52% 8.76% 0.21% 4.53% 7.55%
MSCI All Country Asia ex Japan Index
3.51% 4.39% 4.39% -8.54% 7.29% 0.38% 4.36% 4.17%
For the years ended December 31st
Name 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013
Matthews Pacific Tiger Fund - MAPTX
MAPTX
-20.73% -4.41% 28.83% 10.72% -11.11% 39.96% -0.16% -1.30% 11.79% 3.63%
MSCI All Country Asia ex Japan Index
-19.36% -4.46% 25.36% 18.52% -14.12% 42.08% 5.76% -8.90% 5.11% 3.34%

MSCI AC Asia ex Japan Index since inception value calculated from 08/31/94.

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 03/31/2023)

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.

Ratings

  • OVERALL
  • out of 48 funds
  • 3 YEAR
  • out of 48 funds
  • 5 YEAR
  • out of 46 funds
  • 10 YEAR
  • out of 32 funds
  • 1 YEAR
  • 3rd
  • 17 out of 32 funds
  • 3 YEAR
  • 2nd
  • 16 out of 31 funds
  • 5 YEAR
  • 3rd
  • 23 out of 30 funds
  • 10 YEAR
  • 2nd
  • 9 out of 18 funds
  • SINCE INCEPTION
  • 2nd
  • 2 out of 4 funds

Ratings agency calculation methodology

Portfolio Managers

Sharat  Shroff, CFA photo
Sharat Shroff, CFA

Lead Manager

Inbok  Song photo
Inbok Song

Lead Manager

Winnie  Chwang photo
Winnie Chwang

Co-Manager

Andrew  Mattock, CFA photo
Andrew Mattock, CFA

Co-Manager

Portfolio Characteristics

(as of 03/31/2023)
Fund Benchmark
Number of Positions 52 1,188
Weighted Average Market Cap $121.8 billion $116.4 billion
Active Share 67.2 n.a.
P/E using FY1 estimates 20.8x 13.2x
P/E using FY2 estimates 16.8x 11.6x
Price/Cash Flow 13.7 6.8
Price/Book 3.1 1.6
Return On Equity 17.7 14.9
EPS Growth (3 Yr) 21.9% 17.3%

Sources: Factset Research Systems, Inc.

Risk Metrics (3 Yr Return)

(as of 03/31/2023)
1.21%
Alpha
1.06
Beta
105.14%
Upside Capture
99.27%
Downside Capture
0.35
Sharpe Ratio
0.29
Information Ratio
5.13%
Tracking Error
94.99

Fund Risk Metrics are reflective of Investor share class.

Sources: Zephyr StyleADVISOR

Top 10 Holdings

(as of 05/31/2023)
Name Sector Country % Net Assets
Taiwan Semiconductor Manufacturing Co., Ltd. Information Technology Taiwan 7.2
Samsung Electronics Co., Ltd. Information Technology South Korea 6.1
Tencent Holdings, Ltd. Communication Services China/Hong Kong 4.4
ICICI Bank, Ltd. Financials India 3.7
Alibaba Group Holding, Ltd. Consumer Discretionary China/Hong Kong 3.6
Central Pattana Public Co., Ltd. Real Estate Thailand 3.1
PT Bank Central Asia Tbk Financials Indonesia 2.9
Meituan Consumer Discretionary China/Hong Kong 2.9
Yum China Holdings, Inc. Consumer Discretionary China/Hong Kong 2.7
China Resources Beer Holdings Co., Ltd. Consumer Staples China/Hong Kong 2.5
TOTAL 39.1

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 03/31/2023)
  • Sector Allocation
  • Country Allocation
  • Market Cap Exposure
Sector Fund Benchmark Difference
Information Technology 21.2 23.0 -1.8
Consumer Discretionary 19.5 14.6 4.9
Financials 17.1 20.4 -3.3
Consumer Staples 9.0 5.4 3.6
Industrials 8.4 6.7 1.7
Real Estate 8.4 3.8 4.6
Communication Services 6.0 10.8 -4.8
Materials 3.1 5.4 -2.3
Health Care 1.7 3.8 -2.1
Utilities 1.7 2.5 -0.8
Energy 0.0 3.6 -3.6
Cash and Other Assets, Less Liabilities 4.0 0.0 4.0

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

Country Fund Benchmark Difference
China/Hong Kong 47.5 43.7 3.8
Taiwan 14.9 17.0 -2.1
India 13.4 14.6 -1.2
South Korea 9.5 13.4 -3.9
Thailand 2.9 2.4 0.5
Indonesia 2.6 2.1 0.5
Philippines 2.3 0.8 1.5
Vietnam 1.5 0.0 1.5
Singapore 1.4 4.0 -2.6
Malaysia 0.0 1.6 -1.6
Macau 0.0 0.3 -0.3
Cash and Other Assets, Less Liabilities 4.0 0.0 4.0

Not all countries are included in the benchmark index(es).

Equity market cap of issuer Fund Benchmark Difference
Mega Cap (over $25B) 63.1 58.8 4.3
Large Cap ($10B-$25B) 15.1 20.5 -5.4
Mid Cap ($3B-$10B) 15.3 19.2 -3.9
Small Cap (under $3B) 2.5 1.4 1.1
Cash and Other Assets, Less Liabilities 4.0 0.0 4.0

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.

Distributions

Record Date Ex, Pay and
Reinvest Date
Ordinary
Income
Short Term
Capital Gains
Long Term
Capital Gains
Total Distributions
Per Share
% of NAV Nondividend Distribution (Return of Capital)
12/13/2022 12/14/2022 $0.00000 $0.09181 $1.62570 $1.71751 7.7% N.A.
View History

 

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.

Commentary

Period ended March 31, 2023

For the quarter ending March 31, 2023, the Matthews Pacific Tiger Fund returned 4.32% (Investor Class) and 4.37% (Institutional Class), while its benchmark, the MSCI All Country Asia ex Japan Index, returned 4.39% over the same period.

Market Environment:

The first quarter of the year was positive, albeit volatile, for emerging markets and Asia following a broadly difficult 2022 for most major equity markets. Chinese equities grinded higher with considerable volatility after strong rebound from October bottom in 2022. The country’s lifting of its long-standing COVID restrictions allowed for a ‘more normal’ Chinese New Year celebration helping to boost consumption indicators especially those focused on domestic tourism and local services. However, more widespread consumption recovery seems to be rather slow and gradual as it is also conditioned to the property market and broad-based employment improvement. On the other hand, continued U.S. interest rates increase amid rather sticky inflation data caused market volatility as markets priced in a ‘higher for longer’ Fed Funds rate. Central banks in Asia didn’t follow the Fed’s path and stronger fiscal situation of the Asian countries were generally supportive for their currencies.  All in, it was a positive start to the year for most Asia markets with India being notable exception. Indian equities were the region’s laggard in the quarter with elevated valuations from last year’s strong performance.  

Performance Contributors and Detractors:

From a country perspective, Taiwan and South Korea contributed the most to the Fund’s absolute performance. Information technology companies in Taiwan, including Taiwan Semiconductor Manufacturing Company, a multinational semiconductor contract manufacturing company, Accton Technology Corporation, which primarily engages in the development and manufacture of networking and communication solutions, and MediaTek, one the largest global fabless semiconductor company, were among the top contributors as they reported better-than-expected earnings, where market expectation was low to begin with. Additionally, a stock selection in South Korea, Samsung Engineering contributed to performance given its continued success in procuring orders and improved margin management.

On the other hand, the biggest detractor from relative performance was the weaker stock selection in China led by a handful of positions in the consumer discretionary sector. E-commerce company JD.com, food-delivery service company Meituan and the a leading duty free shop operator, China Tourism Group were among the weakest performers albeit the businesses are well positioned to participate in the normalization of economic activity in the country.

Notable Portfolio Changes:

The first quarter of the year was a relatively quieter period for the Fund as no major directional shifts were implemented. The biggest active risk in the portfolio stems from a heavier allocation to domestic consumption in China, a bigger position in some of the platform businesses with clear competitive advantages, and a continued belief about a pickup in investment activity in India. Additionally, the Fund’s underweight in South Korea reflects some concern on the outlook for global growth.

Outlook:

Asia’s equity markets partly reversed some of the trends from the last calendar year with Taiwanese and South Korea outperforming India significantly. There was wide divergence in sectoral performance with information technology and telecom services gaining over utilities. There wasn’t any meaningful dispersion between the growth and value version of the MSCI AC Asia ex Japan Index. It is notable that the yield environment in many parts of Asia was relatively steadier compared to U.S. Much of the gains in Asia have been driven by multiple expansion. Looking ahead, we continue to expect China and India to deliver mid-to-high-teens rate of growth over the next two years led by post COVID-19 reopening/normalization and recovery in margin. Valuations across Asia look fair although it does mask wide disparity across different countries—China still looks inexpensive, while India is trading at a premium to other Emerging Markets, although that premium has eroded in the past six months.

 

Top 10 holdings as of March 31, 2023. Current and future holdings are subject to change and risk.

 

Average Annual Total Returns - MAPTX as of 03/31/2023
1YR 3YR 5YR 10YR Since Inception Inception Date
-6.52% 8.76% 0.21% 4.53% 7.55% 09/12/1994

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 1.10%
Net Expense Ratio 1.09%

Matthews has contractually agreed to waive fees and reimburse expenses to limit the Total Annual Fund Operating Expenses until April 30, 2024. Please see the Fund’s prospectus for additional details.

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.

 

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.