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Are your international investments missing something?

Put the real power 
of Asia in your portfolio

Asia stands apart

While the rest of the world continues to struggle with low levels of economic growth, Asia stands apart

Projected GDP growth in 2017

0.0%

Asia

0.0%

U.S.

0.0%

Europe

0.0%

Latin America

Source: World Economic Outlook, 
January 2017 estimates

By 2050, Asia will account for:

Half of 
global GDP

Source: The Economist, 2015


Half of the 
world's population

Source: United Nations, 2015

Two-thirds of all 
middle-class spending

Source: Organization for Economic 
Co-operation and Development 
(OECD), January 2010

Swords

Missing the opportunity:
Too little Asia

Exposure to Asia has typically come from benchmarks which underrepresent the region

0%

A typical investor portfolio with a 
35% international allocation…

0%

would have a 7% allocation to 
Asia ex Japan if benchmarked 
to MSCI EAFE^

0%

… and only 2% if benchmarked to 
MSCI ACWI ex U.S.*

Source: iShares.com

 99%Only 1% of U.S. investors have a dedicated 
exposure to Asia

Source: Investworks, December 31, 2015

Missing the opportunity:
The wrong kind of Asia

Tech Travel Health care E-Commerce Banks Exporters Heavy industry
1990

Banks, Exporters, Heavy Industry

Indices are heavily weighted in older
parts of the economy…

Tech, Travel, Health, E-Commerce

… neglecting consumption and services that
represent a growing part of the Asian economy
Gong

Missing the opportunity:
The right kind of Asia

Consumer spending

Rising consumption rates across Asia are expected to lead to a sharp increase in discretionary spending on non-essential purchases

Asia Pacific Region

Global consumption projected growth rates: 
2015-2030

0% U.S.
0 Latin America
0 Europe
0% Asia Pacific

Source: Mckinsey & Company: The global consumers to watch, April 2016

China

Rising discretionary spending: Projected annual growth rate, 2000-2020

Discretionary spending
Personal items, recreation, education, transport, communications
0.0%
Semi-necessities
Apparel, health care, household products
0.0%
Necessities
Food
0.0%

Source: Mckinsey & Company, Meet the Chinese consumers of 2020, March 2012

Health care

Asia is expected to experience a sharp increase in health care spending, with countries 
like India leading the pack

Asia Pacific Region

Expected annual average increase in health care

0.0%
 

Asia Pacific region

0.0%
 

North America

Source: Deloitte Global Healthcare Outlook, 2014

India


0%

India health spending 
projection 2014-2018

$0 
US billion

Indian pharmaceutical market 
size is expected to grow to 
US$100 billion by 2025

Source: India Brand Equity Foundation, 2017

Travel

Rising personal wealth and spending on leisure are increasing intra Asia travel

Japan


South KoreaChinaIndiaJapanPhilippinesIndonesiaSingaporeMalaysiaThailandHong KongTaiwanVietnam
Japan 0.0
million
Japan drew 19.7 million 
overseas visitors in 2015
2010 x0 This is more than double the 8.6 million overseas visitors it saw in 2010
Flights 0.0
million
Total visitors came 
from Asian countries

Source: Japan National Tourism Organization

E-Commerce

Smartphone ownership is on the rise across the continent, leading to a huge opportunity 
for tech-related industries

Asia Pacific Region


Internet users who own a smartphone (Q3 2016)

0%
0%
0%
Asia Pacific Europe North America

Source: Emarketer


Spending $0
US trillion
Global e-commerce 
spending from Asia in 2016
2012 $0.0
US trillion
By 2020, that number 
is expected to grow to 
US$2.7 trillion…
Global eCommerce 0 … representing an 
estimated 60% of global
e-commerce spending
Dragon

Discover the 
power of Asia

At Matthews Asia, we believe that many investors are under-allocated to the region and are therefore missing out on attractive investment opportunities.

For over 25 years, we have pursued an active, fundamental approach to investing in Asia, resulting in portfolios with an average active share of 85% and holdings that we believe represent a better exposure to the future growth of the region.

Put the power of Asia in your portfolio with Matthews Asia.

What is active share and why is it so important to Asia

Featuring Robert Horrocks, PhD, Chief Investment Officer

Allocating to Asia

Our guide for long-term investors 
to help demystify and evaluate the 
benefits of making a meaningful 
allocation to Asian investments.

Download white paper
^MSCI EAFE is represented by the iShares MSCI EAFE ETF
*MSCI ACWI ex U.S. is represented by the iShares MSCI ACWI ex U.S. ETF

There is no guarantee any estimates or projections will be achieved.

The views and information discussed herein are as of the date of publication, are subject to change and may not reflect current views. The views expressed represent an assessment of market conditions at a specific point in time, are opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. Such information does not constitute a recommendation to buy or sell specific securities or investment vehicles. 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. Matthews Asia does not accept any liability for losses either direct or consequential caused by the use of this information.

Download our ‘Allocating to Asia’ White Paper

Download white paper