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Matthews Emerging Markets ex China Equity Fund

Snapshot
  • Seeks alpha in global emerging markets ex China—capitalizes on consumption and innovation trends
  • Quality growth portfolio—based on deep, holistic analysis
  • All-cap, company-first approach—emphasizes fundamental research over top-down country or sector allocation

15/09/2023

Inception Date

12.26%

YTD Return (USD)

(as of 14/07/2025)

$12.64

NAV (USD)

(as of 14/07/2025)

-0.01

1 Day NAV Change

(as of 14/07/2025)

Objective

Seeks to achieve long term capital appreciation.

Sustainability

The Fund promotes environmental and social characteristics according to Article 8 of SFDR. Furthermore, the Fund uses both activity- and norm-based exclusions. Information relating to the environmental and social characteristics of this Fund is available in the prospectus.

Strategy

Under normal market conditions, the Fund seeks to achieve its investment objective by investing, directly or indirectly, primarily (i.e., at least 65% of its total net assets) in equities of companies located in or with substantial ties to emerging market countries excluding China. Emerging Market countries generally include every country in the world except the United States, Australia, Canada, Hong Kong, Israel, Japan, New Zealand, Singapore and most of the countries in Western Europe. Certain emerging market countries may also be classified as “frontier” market countries, which are a subset of emerging market countries with newer or even less developed economies and markets, such as Sri Lanka and Vietnam. The list of emerging market countries and frontier market countries may change from time to time. In addition, the Fund may also invest in depositary receipts that are treated as emerging markets investments, including American, European and Global Depositary Receipts.

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, emerging and frontier market securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation, which may adversely affect the value of the Fund's assets. 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.

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

Fund Facts
Inception Date 15/09/2023
Fund Assets $2.55 million (30/06/2025)
Base Currency USD
ISIN: LU2651608247 (USD) LU2651608320 (GBP)
Bloomberg Symbol EMMKCIA:LX (USD) EMMEXCI:LX (GBP)
Benchmark MSCI Emerging Markets ex China Index
Geographic Focus Emerging Markets excluding China- Countries generally include every country in the world except the United States, Australia, Canada, Hong Kong, Israel, Japan, New Zealand, Singapore and most of the countries in Western Europe.
SFDR Classification Article 8
Fees & Expenses
Management Fee 0.75%
Total Expense Ratio 0.90% ( USD ) 0.90% ( GBP )

Performance

  • Monthly
  • Quarterly
  • Calendar Year
  • Rolling 12 Month
    Returns
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As of 30/06/2025
Annualized Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Emerging Markets ex China Equity Fund (USD)
6.20% 17.19% 12.61% 9.97% n.a. n.a. n.a. 14.19% 15/09/2023
MSCI Emerging Markets ex China Index (USD)
7.12% 16.80% 14.91% 10.19% n.a. n.a. n.a. 16.03%
Matthews Emerging Markets ex China Equity Fund (GBP)
4.37% 10.71% 2.87% 1.33% n.a. n.a. n.a. 7.97% 15/09/2023
MSCI Emerging Markets ex China Index (GBP)
5.41% 10.02% 5.02% 1.65% n.a. n.a. n.a. 9.71%
As of 30/06/2025
Annualized Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews Emerging Markets ex China Equity Fund (USD)
6.20% 17.19% 12.61% 9.97% n.a. n.a. n.a. 14.19% 15/09/2023
MSCI Emerging Markets ex China Index (USD)
7.12% 16.80% 14.91% 10.19% n.a. n.a. n.a. 16.03%
Matthews Emerging Markets ex China Equity Fund (GBP)
4.37% 10.71% 2.87% 1.33% n.a. n.a. n.a. 7.97% 15/09/2023
MSCI Emerging Markets ex China Index (GBP)
5.41% 10.02% 5.02% 1.65% n.a. n.a. n.a. 9.71%
For the years ended December 31st
Name 2024 2023 2022 2021 2020
Matthews Emerging Markets ex China Equity Fund (USD)
7.44% n.a. n.a. n.a. n.a.
MSCI Emerging Markets ex China Index (USD)
4.20% n.a. n.a. n.a. n.a.
Matthews Emerging Markets ex China Equity Fund (GBP)
9.10% n.a. n.a. n.a. n.a.
MSCI Emerging Markets ex China Index (GBP)
6.06% n.a. n.a. n.a. n.a.
For the period ended 30/06/2025
Name 2025 2024 2023 2022 2021 Inception Date
Matthews Emerging Markets ex China Equity Fund (USD)
9.97% n.a. n.a. n.a. n.a. 15/09/2023
MSCI Emerging Markets ex China Index (USD)
10.19% n.a. n.a. n.a. n.a.
Matthews Emerging Markets ex China Equity Fund (GBP)
1.33% n.a. n.a. n.a. n.a. 15/09/2023
MSCI Emerging Markets ex China Index (GBP)
1.65% n.a. n.a. n.a. n.a.

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

All returns over 1 year are annualized

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 30/06/2025)
Fund Benchmark
Number of Positions 76 645
Weighted Average Market Cap $138.8 billion $189.4 billion
Active Share 80.6 n.a.
P/E using FY1 estimates 15.1x 13.9x
P/E using FY2 estimates 13.2x 12.4x
Price/Cash Flow 9.9 8.8
Price/Book 2.6 2.1
Return On Equity 20.5 19.3
EPS Growth (3 Yr) 19.9% 10.1%

Sources: Factset Research Systems, Inc.

Top 10 Holdings

(as of 30/06/2025)
Name Sector Country % Net Assets
Taiwan Semiconductor Manufacturing Co., Ltd. Information Technology Taiwan 9.5
Samsung Electronics Co., Ltd. Information Technology South Korea 4.0
HDFC Bank, Ltd. Financials India 2.9
ICICI Bank, Ltd. Financials India 2.3
Bandhan Bank, Ltd. Financials India 2.0
Poya International Co., Ltd. Consumer Discretionary Taiwan 2.0
PT Indosat Tbk Communication Services Indonesia 1.8
NAVER Corp. Communication Services South Korea 1.7
MediaTek, Inc. Information Technology Taiwan 1.7
SK Hynix, Inc. Information Technology South Korea 1.7
TOTAL 29.6

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 30/06/2025)
  • Sector Allocation
  • Country Allocation
  • Market Cap Exposure
Sector Fund Benchmark Difference
Financials 28.0 26.7 1.3
Information Technology 22.8 30.0 -7.2
Consumer Discretionary 10.1 6.4 3.7
Consumer Staples 8.8 4.9 3.9
Industrials 7.6 7.9 -0.3
Health Care 7.2 2.9 4.3
Communication Services 5.9 5.0 0.9
Energy 3.3 5.0 -1.7
Materials 2.1 6.9 -4.8
Utilities 1.2 2.8 -1.6
Real Estate 0.0 1.5 -1.5
Cash and Other Assets, Less Liabilities 2.8 0.0 2.8

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

Country Fund Benchmark Difference
India 21.6 25.3 -3.7
Taiwan 18.2 26.3 -8.1
South Korea 13.9 15.0 -1.1
Brazil 7.1 6.2 0.9
Indonesia 4.3 1.6 2.7
South Africa 3.6 4.5 -0.9
Thailand 3.5 1.4 2.1
Malaysia 3.1 1.8 1.3
Mexico 2.7 2.7 0.0
Philippines 2.7 0.6 2.1
Singapore 2.5 0.0 2.5
Saudi Arabia 2.1 4.9 -2.8
Poland 2.1 1.6 0.5
United States 2.1 0.0 2.1
Vietnam 1.8 0.0 1.8
United Arab Emirates 1.2 2.2 -1.0
Peru 1.2 0.4 0.8
Greece 1.0 0.9 0.1
China/Hong Kong 1.0 0.1 0.9
Argentina 0.9 0.0 0.9
Turkey 0.6 0.7 -0.1
Kuwait 0.0 1.1 -1.1
Qatar 0.0 1.0 -1.0
Chile 0.0 0.6 -0.6
Hungary 0.0 0.4 -0.4
Colombia 0.0 0.2 -0.2
Czech Republic 0.0 0.2 -0.2
Egypt 0.0 0.1 -0.1
Cash and Other Assets, Less Liabilities 2.8 0.0 2.8

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

Equity market cap of issuer Fund Benchmark Difference
Mega Cap (over $25B) 48.5 57.1 -8.6
Large Cap ($10B-$25B) 20.4 26.2 -5.8
Mid Cap ($3B-$10B) 22.9 16.4 6.5
Small Cap (under $3B) 5.4 0.3 5.1
Cash and Other Assets, Less Liabilities 2.8 0.0 2.8

Source: FactSet Research Systems unless otherwise noted.
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.

ESG Characteristics

(as of 31/03/2025)
  • Business Involvement
  • Sustainability Attributes
Name Fund Benchmark Difference
Controversial Weapons
Fund Coverage: 100% Benchmark Coverage: 99%
0.0 0.9 -0.9
Tobacco
Fund Coverage: 99% Benchmark Coverage: 98%
0.0 0.5 -0.5
Name Fund Benchmark Difference
UN Global Compact Violators
Fund Coverage: 100% Benchmark Coverage: 99%
0.0 1.5 -1.5
Board Diversity
Fund Coverage: 100% Benchmark Coverage: 99%
20.5 19.6 0.9

Board Diversity: Represents the weighted average ratio of female board members in investee companies.
Tobacco: Represents companies that generate more than 5% of revenue from tobacco manufacturing exposure to or production or that generate more than 50% of revenue from tobacco retail. 
UN Global Compact Violators: Represents companies that have been assessed as failing to comply with the 10 United Nations Global Compact Principles by ISS-ESG Norms-Based Research. Different ESG research providers may come to different conclusions on the severity of the violation.
Controversial weapons include companies with involvement in the following: anti-personnel mines; biological and chemical weapons; cluster weapons; depleted uranium; nuclear weapons and white phosphorus. A company is excluded if it is directly involved in the production, selling and/or distribution of (parts of) controversial weapons and this involvement concerns the core weapon system, or components/services of the core weapon system that are tailor-made and essential for the lethal use of the weapon.

Source: Sustainalytics, Factset, MSCI, Matthews Asia.

Sustainability-related Disclosures

This Fund Yes No
Complies with Article 8 of SFDR  
Investment process integrates ESG factors and sustainability risks based on proprietary and third-party research  
Applies norms- and activity-based exclusions  
Promotes environmental and social characteristics  
Has a sustainable investment objective  
Conducts engagement  
Exercises Voting Rights  

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 Fund’s investment objective and risk factors.

For more information, please refer to our Responsible Investment and Stewardship Policy and our ESG-Related Investment Policy of Matthews Asia Funds.

Portfolio Managers

Jeremy  Sutch, CFA photo
Sean  Taylor photo

Commentary

Period ended 30 June 2025

Market Environment

  • Emerging markets had a positive quarter as concerns over U.S. tariffs eased amid potential trade deals while growth in the artificial intelligence (AI) supply chain remained strong. A temporarily weakened U.S. dollar also provided a tailwind for emerging markets. Emerging markets overall gained 12%.
  • South Korea was the top performing emerging market buoyed by the election of President Lee Jae Myung who is seen as a progressive and market friendly leader. India’s performance improved as the central bank cut rates to try and boost consumer spending. Markets in Southeast Asia were affected by domestic political issues and concerns over U.S. tariffs.
  • Latin America outperformed the broad emerging markets index. Mexico’s market benefited from alignments to the U.S. economy and Brazil gained amid an improving macro environment. A major source of uncertainty in the period was the Israel-Iran conflict and the implications it may have for the wider region and global economy.

Contributors and Detractors

  • For the quarter ended June 30, 2025, the Emerging Markets ex China Equity Fund returned 17.19%, (I Acc USD) while its benchmark, the MSCI Emerging Markets ex China Index, returned 16.80% over the same period.
  • On a country basis, the top three contributors to relative performance were India due to stock selection, Saudi Arabia due to an underweight allocation and Indonesia due to stock selection. The top three detractors were Thailand due to stock selection, United Arab Emirates due to an overweight allocation and stock selection and Vietnam due to an off-benchmark allocation.
  • On a sector basis, the top three contributors to relative performance were communication services due to stock selection, materials due to an underweight allocation and utilities due to stock selection. The top three detractors were consumer staples and health care due to an overweight allocation and industrials due to an underweight allocation.
  • The largest contributors to absolute performance included Taiwan Semiconductor Manufacturing Company (TSMC), a globally-leading chipmaker, Elite Material, a Taiwanese chip manufacturing company, and SK Hynix, a Korean semiconductor company. The top three detractors included Capitec Bank Holdings Ltd., a South African financials company, Petroleo Brasileiro (Petrobras), a Brazilian oil and natural gas producer, and Eclat Textile Company, a Taiwanese textile company.

Outlook

  • With President Trump’s July 9 deadline for reaching trade agreements approaching, more market volatility is to be expected. However, we believe the peak fear of tariffs has passed—barring any significant escalation in duties on countries where agreements are not reached.
  • We also think that earnings growth improvements in emerging markets could potentially offer significant upside pressure to investment returns. During the quarter, a large proportion of returns were tied to rising valuations and currency movements, with limited impact from improving financial results.
  • A potential loosening of U.S. monetary policy and a weaker dollar would also be favorable for emerging markets, particularly in Latin America and other economies exposed to global trade.
  • As summer headwinds ease, in terms of seasonality, Middle East conflicts, trade and the U.S. economy, we believe there will be greater clarity on the prospects for global markets. This should allow the drivers of emerging markets—earnings recovery, diversification, a weaker dollar, and cheap valuations—to gain traction in our view.
Rolling 12 Month Returns For the period ended 30/06/2025 - I (Acc)
Name 2025 2024 2023 2022 2021 Inception Date
Matthews Emerging Markets ex China Equity Fund (USD)
9.97% N.A. N.A. N.A. N.A. 15/09/2023
MSCI Emerging Markets ex China Index (USD)
10.19% N.A. N.A. N.A. N.A.
Matthews Emerging Markets ex China Equity Fund (GBP)
1.33% N.A. N.A. N.A. N.A. 15/09/2023
MSCI Emerging Markets ex China Index (GBP)
1.65% N.A. N.A. N.A. N.A.

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

To find documents in additional languages, please visit the Fund Literature page in our Resources section.

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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