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Asia Growth

Matthews Pacific Tiger Fund

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

30/04/2010

Inception Date

-3.35%

YTD Return (USD)

(as of 30/11/2021)

$24.20

Price (USD)

(as of 30/11/2021)

$505.25 million

Fund Assets

(as of 31/10/2021)

Objective

Seeks to achieve long term capital appreciation.

Strategy

The Fund seeks to achieve its investment objective by investing, directly or indirectly, at least 65% of its total net assets, in equities of companies located in Asia, and may invest the remainder of its net assets in other permitted assets on a worldwide basis. For the purpose of this policy, Asia includes China, Hong Kong, India, Indonesia, Malaysia, Pakistan, Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam.

Risks

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 and emerging market securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. The Fund invests in holdings denominated in foreign currencies, and is exposed to the risk that the value of the foreign currency will increase or decrease. The Fund invests primarily in equity securities, which may result in increased volatility.

The risks associated with investing in the Fund can be found in the prospectus.

Fund Facts
Inception Date 30/04/2010
Fund Assets $505.25 million (31/10/2021)
Base Currency USD
ISIN: LU0491816475 (USD) LU0594555756 (GBP) LU0491816129 (EUR) LU1576347550 (JPY)
Bloomberg Symbol MATAPTI:LX (USD) MATAPGI:LX (GBP) MAPTFIE:LX (EUR) MPACTIJ:LX (JPY)
Benchmark MSCI All Country Asia ex Japan Index
Geographic Focus Asia Ex Japan: Consists of all countries and markets in Asia, excluding Japan but including all developed, emerging and frontier countries and markets in Asia
Fees & Expenses
Management Fee 0.75%
Total Expense Ratio As of 30/09/2021 0.90% ( USD ) 0.90% ( GBP ) 0.90% ( EUR ) 0.90% ( JPY )

Performance

  • Monthly
  • Quarterly
  • Calendar Year
  • Rolling 12 Month
    Returns
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As of 31/10/2021
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Pacific Tiger Fund (USD)
2.52% -0.32% 0.72% 18.74% 15.10% 11.28% 8.85% 8.37% 30/04/2010
MSCI All Country Asia ex Japan Index (USD)
1.36% -0.59% -2.00% 13.12% 14.28% 11.08% 7.72% 7.07%
Matthews Pacific Tiger Fund (GBP)
0.00% 0.88% -0.18% 11.76% 12.11% 8.52% 10.50% 9.97% 28/02/2011
MSCI All Country Asia ex Japan Index (GBP)
-0.29% 0.83% -2.27% 6.71% 11.64% 8.54% 9.50% 8.37%
Matthews Pacific Tiger Fund (JPY)
4.24% 3.49% 11.28% 29.47% 15.32% n.a. n.a. 12.02% 27/03/2017
MSCI All Country Asia ex Japan (JPY)
3.59% 3.28% 8.23% 23.39% 14.68% n.a. n.a. 11.00%
Matthews Pacific Tiger Fund (EUR)
1.88% 1.64% 6.12% 19.27% n.a. n.a. n.a. 11.05% 30/04/2019
MSCI All Country Asia ex Japan Index (EUR)
1.51% 1.86% 3.61% 13.86% n.a. n.a. n.a. 9.02%
As of 30/09/2021
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Pacific Tiger Fund (USD)
-3.61% -7.90% -1.76% 19.88% 11.47% 10.11% 9.53% 8.20% 30/04/2010
MSCI All Country Asia ex Japan Index (USD)
-4.15% -9.23% -3.32% 14.73% 9.50% 10.44% 8.80% 7.00%
Matthews Pacific Tiger Fund (GBP)
-1.18% -5.03% -0.18% 14.31% 10.31% 9.30% 11.16% 10.05% 28/02/2011
MSCI All Country Asia ex Japan Index (GBP)
-2.17% -7.00% -1.98% 10.00% 8.29% 9.62% 10.39% 8.47%
Matthews Pacific Tiger Fund (JPY)
-1.72% -6.68% 6.76% 26.99% 11.01% n.a. n.a. 11.23% 27/03/2017
MSCI All Country Asia ex Japan (JPY)
-2.65% -8.75% 4.48% 21.30% 8.85% n.a. n.a. 10.35%
Matthews Pacific Tiger Fund (EUR)
-1.47% -5.41% 4.16% 21.18% n.a. n.a. n.a. 10.60% 30/04/2019
MSCI All Country Asia ex Japan Index (EUR)
-2.37% -7.12% 2.07% 16.08% n.a. n.a. n.a. 8.68%
For the years ended December 31st
Name 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Matthews Pacific Tiger Fund (USD)
30.48% 11.18% -10.71% 39.47% -0.29% -1.91% 11.22% 4.86% 18.65% -12.40%
MSCI All Country Asia ex Japan Index (USD)
25.36% 18.52% -14.12% 42.08% 5.76% -8.90% 5.11% 3.34% 22.70% -17.07%
Matthews Pacific Tiger Fund (GBP)
25.96% 7.87% -5.71% 27.14% 19.96% 3.14% 18.00% 2.56% 13.54% n.a.
MSCI All Country Asia ex Japan Index (GBP)
21.49% 13.94% -8.78% 29.78% 26.15% -3.63% 11.65% 1.42% 17.31% n.a.
Matthews Pacific Tiger Fund (JPY)
23.94% 9.79% -12.83% n.a. n.a. n.a. n.a. n.a. n.a. n.a.
MSCI All Country Asia ex Japan (JPY)
19.10% 17.39% -16.36% n.a. n.a. n.a. n.a. n.a. n.a. n.a.
Matthews Pacific Tiger Fund (EUR)
19.40% n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
MSCI All Country Asia ex Japan Index (EUR)
15.01% n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
For the period ended 30/09/2021
Name 2021 2020 2019 2018 2017 Inception Date
Matthews Pacific Tiger Fund (USD)
19.88% 15.22% 0.28% 3.62% 12.76% 30/04/2010
MSCI All Country Asia ex Japan Index (USD)
14.73% 18.16% -3.15% 1.74% 23.02%
Matthews Pacific Tiger Fund (GBP)
14.31% 10.60% 6.19% 6.43% 9.17% 28/02/2011
MSCI All Country Asia ex Japan Index (GBP)
10.00% 12.63% 2.49% 4.67% 19.11%
Matthews Pacific Tiger Fund (JPY)
26.99% 12.84% -4.52% 4.46% n.a. 27/03/2017
MSCI All Country Asia ex Japan (JPY)
21.30% 15.38% -7.85% 2.66% n.a.
Matthews Pacific Tiger Fund (EUR)
21.18% 7.23% n.a. n.a. n.a. 30/04/2019
MSCI All Country Asia ex Japan Index (EUR)
16.08% 9.85% n.a. n.a. n.a.

Source: Brown Brothers Harriman (Luxembourg) S.C.A.

Since inception performance for share classes with less than one year of history represents actual performance, not annualised. In addition, for share classes less than a year old, Year to Date Return is calculated since inception. Where no past performance is shown there was insufficient data available in that year to provide performance.

Performance details provided are based on a NAV-to-NAV basis with any dividends reinvested, and are net of management fees and other expenses. Performance data has been calculated in the respective currencies stated above, including ongoing charges and excluding subscription fee and redemption fee you might have to pay.

All performance quoted represents past performance and is not indicative of future performance. Investors may not get back the full amount invested. Investors investing in funds denominated in non-local currency should be aware of the risk of currency exchange fluctuations that may cause a loss of principal.

Additional performance, attribution, liquidity, value at risk (VaR), security classification and holdings information is available on request for certain time periods.

Portfolio Characteristics

(as of 31/10/2021)
Fund Benchmark
Number of Positions 71 1,209
Weighted Average Market Cap $136.0 billion $152.8 billion
Active Share 66.9 n.a.
P/E using FY1 estimates 21.1x 13.7x
P/E using FY2 estimates 20.2x 12.9x
Price/Cash Flow 18.4 9.7
Price/Book 3.9 1.9
Return On Equity 15.6 13.0
EPS Growth (3 Yr) 1.5% -3.0%

Sources: Factset Research Systems, Inc.

Risk Metrics (3 Yr Return)

(as of 31/10/2021)
0.97%
Alpha
0.99
Beta
94.52%
Upside Capture
91.01%
Downside Capture
0.77
Sharpe Ratio
0.15
Information Ratio
5.41%
Tracking Error
91.10

Fund Risk Metrics are reflective of Class I USD ACC shares.

Sources: Zephyr StyleADVISOR

Top 10 Holdings

(as of 31/10/2021)
Name Sector Country % Net Assets
Taiwan Semiconductor Manufacturing Co., Ltd. Information Technology Taiwan 6.5
Tencent Holdings, Ltd. Communication Services China/Hong Kong 4.7
Samsung Electronics Co., Ltd. Information Technology South Korea 4.1
Alibaba Group Holding, Ltd. Consumer Discretionary China/Hong Kong 3.2
AIA Group, Ltd. Financials China/Hong Kong 2.7
Central Pattana Public Co., Ltd. Real Estate Thailand 2.3
Hong Kong Exchanges & Clearing, Ltd. Financials China/Hong Kong 2.3
Meituan Consumer Discretionary China/Hong Kong 2.2
Tata Power Co., Ltd. Utilities India 2.1
ICICI Bank, Ltd. Financials India 2.0
TOTAL 32.1

Top 10 holdings may combine more than one security from the same issuer and related depositary receipts.

Source: Brown Brothers Harriman (Luxembourg) S.C.A

Portfolio Breakdown (%)

(as of 31/10/2021)
  • Sector Allocation
  • Country Allocation
  • Asset Type Breakdown
  • Market Cap Exposure

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

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

Asset Type Fund
Common Equities and ADRs 97.3
Cash and Other Assets, Less Liabilities 2.8

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.

Ratings

  • OVERALL
  • 3 YEAR
  • 5 YEAR
  • 10 YEAR
(as of 03/02/2021)

View the Report

(as of 29/07/2021)

Past performance is no guarantee of future results. High ratings and rankings does not assure favorable performance.

Overall Morningstar RatingTM is reflective of the noted share class. Fund ratings represent an opinion only and are not a recommendation to buy or sell any fund. Copyright ©2021 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is provided for reference purposes only.

The Overall Morningstar®️ Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and (if applicable) ten-year ratings.

The Morningstar Analyst Rating™ is subjective in nature and reflects Morningstar's current expectations of future behavior of the fund. Morningstar does not guarantee that a fund will perform in line with its Rating. Likewise, the Rating should not be seen as a guarantee/assessment of the creditworthiness of a fund or its underlying securities and should not be used as the sole basis for making any investment decisions.

Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

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

Commentary

Period ended 30 September 2021

For the quarter ending 30 September 2021, the Matthews Pacific Tiger Fund returned -7.90%, while its benchmark, the MSCI All Country Asia ex Japan Index, returned -9.23% over the same period.

Market Environment:

Most equity markets in the Asia ex Japan region weakened during the third quarter, as debt-related issues in the real estate sector and policy risks in China came to the fore, and continued supply-chain disruptions seemed to weigh on the prospects for normalization in industries like automobiles and semiconductors. While there were some initial scares around a possible resurgence in COVID-19 related infections, it does appear that the bulk of the region is now better placed to cope with the threat.

For the Asia ex Japan region, earnings have generally been revised upwards since the start of the year, led by South Korea and anticipation of strong recovery in India. Sectors like energy, utilities and materials were the best performing during the quarter, as investors anticipated a reflationary environment to favorably impact earnings.

Contributors and Detractors:

The Fund’s stock selection in the utilities sector in India and an internet holding in Singapore contributed to performance. Our holding in India’s Tata Power Company did well over the quarter, and our holding in Sea, Ltd., a leading internet company in Singapore, was also a notable contributor to relative performance. In China, our holding in Starpower, a domestic leader in making power semiconductor chips and modules, was another contributor to relative performance. In these cases, investors seem to be enthused about these company’s competitive positioning and future growth prospects. Stock selection in South Korea was also a contributor to relative performance, especially within the Fund’s battery materials holdings as the demand for electric vehicles continued to rise.

On the other hand, Taiwan was a notable detractor to relative performance during the quarter. The portfolio’s IT-related holdings, including Taiwan-based semiconductor foundry TSMC, have given up some of the gains accrued last year, leading to an erosion in the valuation multiples. In addition, holdings in Southeast Asia, including the Philippines and Malaysia, were detractors. Domestically oriented companies in Southeast Asia have not fully recovered, as these countries’ recovery from the pandemic has taken a longer path and resulted in some retrenchment in forward expectations.

Notable Portfolio Changes:

We made a few changes as part of our continuous efforts to position the portfolio into durable earnings, driven by sustainable growth drivers across countries and sectors. We rotated capital from some of the IT companies to new ideas in sectors like renewable energy related materials and financials.

We also made a few changes in China, shifting into companies with bigger competitive moats and longer-term growth prospects. For example, we added a position in Angelalign Technology, a domestic leading orthodontics manufacturer. As income levels grow in China, demand for such discretionary dental services will likely continue to grow over time. Another China addition this quarter was Chailease Holdings, which provides financing services such as leasing, installment sale, import/export factoring and direct financing. We appreciate Chailease’s combination of growing assets, rising loan spreads and benign asset growth along with strong earnings growth.

The team continues to be mindful of valuations and is looking to trim positions that have done well, and at the same time, take advantage of market volatility to add to current holdings where appropriate.

Outlook:

Looking ahead, several crosscurrents are likely to have an impact on Asian equities in the near to medium term. These crosscurrents may affect the evolution of earnings across the region leading to more normalized (slower) pace of growth, especially as the policy environment continues to unfold in China, and as inflationary pressures evolve in coming periods. A key uncertainty that emerged during the third quarter was the haphazard implementation of certain policies aimed at improving the energy mix in China. While the end goal is laudable, the poor execution may raise more questions about future missteps from the administration.

One of the biggest unanswered questions concerns pricing pressures, some of which reflect consumer demand that is running ahead of constrained supply chains. While the consumer demand recovery has been impressive, it is quite likely that the pattern of consumption will shift towards personal experiences, in our view. As the pandemic continues to abate, it is also possible that labor and other transportation-related bottlenecks will further ease (barring further interruptions from the coronavirus).

The core of the portfolio continues to be invested in businesses capable of delivering durable earnings growth accompanied by solid cash flow. There are many subsectors such as real estate in India and digital e-commerce in Southeast Asia which may have long runways for growth. In addition, we continue to look for Chinese businesses that are taking long strides in closing the technology gap with the West, and may start to substitute imports. The opportunity set continues to broaden and widen, and we remain focused on finding uncorrelated and diversified long-term growth in Asian equities.

 

 

Rolling 12 Month Returns For the period ended 30/09/2021 - I (Acc)
Name 2021 2020 2019 2018 2017 Inception Date
Matthews Pacific Tiger Fund (USD)
19.88% 15.22% 0.28% 3.62% 12.76% 30/04/2010
MSCI All Country Asia ex Japan Index (USD)
14.73% 18.16% -3.15% 1.74% 23.02%
Matthews Pacific Tiger Fund (GBP)
14.31% 10.60% 6.19% 6.43% 9.17% 28/02/2011
MSCI All Country Asia ex Japan Index (GBP)
10.00% 12.63% 2.49% 4.67% 19.11%
Matthews Pacific Tiger Fund (JPY)
26.99% 12.84% -4.52% 4.46% N.A. 27/03/2017
MSCI All Country Asia ex Japan (JPY)
21.30% 15.38% -7.85% 2.66% N.A.
Matthews Pacific Tiger Fund (EUR)
21.18% 7.23% N.A. N.A. N.A. 30/04/2019
MSCI All Country Asia ex Japan Index (EUR)
16.08% 9.85% N.A. N.A. N.A.

Sources: Brown Brothers Harriman (Luxembourg) S.C.A, Matthews Asia, FactSet Research Systems, Bloomberg

 

Performance figures discussed in the Fund Manager Commentary above reflect that of the Institutional Accumulation Class Shares and has been calculated in USD. Performance details provided for the Fund are based on a NAV-to-NAV basis, with any dividends reinvested, and are net of management fees and other expenses. Past performance information is not indicative of future performance. Investors may not get back the full amount invested.

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 and its affiliates do not accept any liability for losses either direct or consequential caused by the use of this information.

Information contained herein is sourced from Matthews Asia unless otherwise stated. The views and opinions in this commentary were as of the report date, subject to change and may not reflect the writer’s 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.

Investors should not invest in the Fund solely based on the information in this material alone. Please refer to the Prospectus for further details of the risk factors. 

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