Message to Shareholders

April 30, 2013

Dear Valued Shareholder,
Matthews Asia is pleased to announce the launch of two new funds, the Matthews Asia Focus and Matthews Emerging Asia Funds.

For more than 20 years, Matthews Asia has aimed to provide investors with a range of Asia investment strategies across the risk-reward spectrum that take advantage of our stock-picking ability and offer exposure to compelling investment opportunities in the region.

Matthews Asia Focus Fund

The developments that have taken place in Asia have led us to recognize that the region now offers a growing pool of established companies—with good corporate governance, strong management teams, and medium to long operating histories—that are recognized as global or regional leaders in their industry. We believe these companies would meet the high standards required for inclusion within a high-conviction portfolio that may appeal to more risk-tolerant investors seeking exposure to an active Asian equity strategy.

The Matthews Asia Focus Fund seeks long-term capital appreciation by investing in companies capable of sustainable growth based on fundamental characteristics. While the Fund is unconstrained by sector, geographic area or market capitalization, it is designed to primarily invest in medium or large-capitalization companies with a concentrated portfolio of 25 to 35 holdings. Each company added to the portfolio will have undergone a thorough due diligence of its business by the investment team to support our high-conviction approach. Both Investor (MAFSX) and Institutional (MIFSX) Class shares are available.

Matthews Emerging Asia Fund

The pace of change in Asia has been focused on countries such as India and China, but the region’s emerging and frontier markets have also benefited from increased economic activity. Rapid growth—together with favorable demographics, increasing consumer wealth and lower labor costs—have all supported a deepening of Emerging Asia’s capital markets in recent years. A bigger universe of publicly traded firms offers investors what we believe are new opportunities to gain exposure to fast-growing companies in what are still relatively inefficient markets.

The Matthews Emerging Asia Fund seeks long-term capital appreciation by investing in growth-oriented companies in much smaller but rapidly developing Asian economies such as Bangladesh, Cambodia, Indonesia, Malaysia, Myanmar, Pakistan, Philippines, Sri Lanka, Thailand and Vietnam. The Fund will also gain exposure to companies in more established Asia ex-Japan countries, such as India, China and Taiwan. These more developed countries also offer the potential to invest in fast-growing companies that, in many cases are benefiting directly from Emerging Asia. Both Investor (MEASX) and Institutional (MIASX) Class shares are available.

For more information about the Matthews Asia Focus or the Matthews Emerging Asia Funds, please visit

If you have any questions regarding the Matthews Asia Funds, please contact our Shareholder Services team at 800-789-ASIA (2742). Thank you for your investment in Matthews Asia.

Best Regards,

Robert Horrocks, PhD
Chief Investment Officer