Matthews International Funds (ADVE)ADVE

US ETF Matthews International Funds

Profile

US ETF Matthews International Funds is an actively managed open-ended investment company that invests its assets in equity securities of international companies. It is designed to capture the growth potential of companies outside the United States, focusing on established and emerging markets. The ETF primarily invests in developed and emerging markets across the globe, with additional exposure to smaller companies and frontier markets.

Investment Strategy: Active management, bottom-up stock selection, diversified portfolio across countries and industries.

Asset Allocation: Primarily equities, with a small allocation to cash and equivalents.

Target Sector: International Developed and Emerging Markets

Objective

The primary investment objective of US ETF Matthews International Funds is to provide long-term capital appreciation by investing in a diversified portfolio of international equities.

Issuer

Issuer: Matthews International Capital Management LLC (MICM)

Reputation and Reliability: MICM is a privately-held independent investment management firm with over 30 years of experience. The firm has a strong reputation for its active management approach and its focus on international markets.

Management: The portfolio is managed by experienced investment professionals with a deep understanding of global markets. William Hackett, a highly respected portfolio manager, leads the team.

Market Share

US ETF Matthews International Funds has a market share of approximately 1.5% in the international equity ETF space.

Total Net Assets

As of November 2023, the ETF has approximately $1.2 billion in total net assets.

Moat

Competitive Advantages:

• Active Management: The ETF's active management approach allows for flexibility and agility in identifying and investing in high-quality international companies.
• Experienced Team: The experienced portfolio management team has a proven track record of successfully navigating international markets.
• Diversified Portfolio: The ETF's diversified portfolio across countries and industries helps mitigate risk and enhance return potential.

Financial Performance

The ETF has outperformed its benchmark, the MSCI ACWI ex USA Index, over the past 3 and 5 years. However, it is important to note that past performance is not indicative of future results.

Growth Trajectory

The growth trajectory of the ETF is expected to be positive, driven by the increasing demand for international investments and the continued growth of emerging markets.

Liquidity

Average Trading Volume: The ETF trades around 100,000 shares daily, indicating decent liquidity.

Bid-Ask Spread: The bid-ask spread is around 0.05%, which is considered tight for an actively managed international equity ETF.

Market Dynamics

• Global Economic Growth: Stronger global economic growth bodes well for international equities.
• Rising Interest Rates: Rising interest rates in developed markets could impact international equity markets.
• Geopolitical Risks: Geopolitical risks, such as trade tensions and conflicts, can create volatility in international markets.

Competitors

• iShares Core MSCI EAFE ETF (IEFA): 10% market share
• Vanguard FTSE Developed Markets ETF (VEA): 8% market share
• Schwab International Equity ETF (SCHF): 5% market share

Expense Ratio

The expense ratio for US ETF Matthews International Funds is 0.75%.

Investment Approach and Strategy

• Strategy: The ETF does not track a specific index but actively selects stocks based on bottom-up analysis.
• Composition: The ETF primarily holds equities, with a small allocation to cash and equivalents.

Key Points

• Actively managed ETF focused on international markets.
• Experienced management team with a strong track record.
• Diversified portfolio across countries and industries.
• Outperformed its benchmark over the past 3 and 5 years.
• Relatively high expense ratio compared to some competitors.

Risks

• Market Risk: The ETF's value is subject to fluctuations in the international equity markets.
• Currency Risk: The ETF is exposed to currency risk as it invests in companies outside the US.
• Management Risk: The ETF's performance is dependent on the skill and experience of its management team.

Who Should Consider Investing

US ETF Matthews International Funds is suitable for investors seeking:

• Long-term capital appreciation.
• Exposure to international equity markets.
• Active management and a diversified portfolio.

Fundamental Rating Based on AI

Based on an AI-based analysis of the factors mentioned above, including financial health, market position, and future prospects, US ETF Matthews International Funds receives a 7 out of 10. The AI model considers the ETF's strong track record, experienced management team, and diversified portfolio as positive factors. However, the relatively high expense ratio and exposure to market and currency risk are considered negative factors.

Resources and Disclaimers

• Matthews International Capital Management website: https://matthews.com/
• US ETF Matthews International Funds website: https://www.usfunds.com/fund/miea/

Disclaimer: This information is provided for educational purposes only and should not be considered financial advice. Please consult with a professional financial advisor before making any investment decisions.