Matthews Emerging Markets Sustainable Future Active ETF (EMSF)

ETF Matthews Emerging Markets Sustainable Future Active ETF (MESF) Summary:

Profile:

MESF is an actively managed ETF that focuses on emerging market companies with strong ESG (Environmental, Social, and Governance) practices. It seeks to provide long-term capital appreciation by investing in companies that are committed to sustainability and have the potential to generate above-average returns.

Objective:

The primary investment goal of MESF is to achieve long-term capital growth by investing in a diversified portfolio of emerging market equities with strong ESG characteristics.

Issuer:

MESF is issued by Matthews International Capital Management, LLC (Matthews), a leading global investment management firm with over 40 years of experience and over $33.7 billion in assets under management. Matthews has a strong reputation for its sustainable investment approach and its commitment to ESG integration.

Market Share:

MESF is a relatively new ETF launched in 2023. As of October 27, 2023, it has approximately $42 million in assets under management, representing a small market share in the emerging markets sustainable investing space.

Total Net Assets:

The total net assets of MESF are currently around $42 million.

Moat:

The competitive advantages of MESF include:

• Active Management: The active management approach allows the portfolio managers to select individual companies with strong ESG profiles and growth potential, potentially outperforming the market.
• Sustainable Investing Expertise: Matthews has extensive experience and a proven track record in sustainable investing, employing robust ESG research and analysis.
• Emerging Market Focus: MESF provides investors access to high-growth potential companies in emerging markets, which are often overlooked by traditional investment strategies.

Financial Performance:

Since its inception in April 2023, MESF has experienced strong performance. As of October 27, 2023, it has generated a total return of 13.52%, exceeding the benchmark MSCI Emerging Markets ESG Leaders Net Index by 1.48%.

Growth Trajectory:

The growth trajectory of MESF is positive. The increasing demand for sustainable investments, coupled with the long-term growth potential of emerging markets, suggests a promising outlook for the ETF.

Liquidity:

MESF has an average daily trading volume of approximately 4,000 shares, indicating moderate liquidity. The bid-ask spread is around 0.05%, suggesting a relatively low trading cost.

Market Dynamics:

Several factors can affect MESF's market environment, including economic growth in emerging markets, developments in ESG regulations, and investor sentiment towards sustainable investing.

Competitors:

Key competitors in the emerging markets sustainable investing space include:

• iShares ESG MSCI EM ETF (ESGE): $4.5 billion in assets under management, expense ratio of 0.46%.
• VanEck Environmental Social Governance Emerging Mkts ETF (ESGE): $1.2 billion in assets under management, expense ratio of 0.45%.

Expense Ratio:

The expense ratio of MESF is 0.75%, which is slightly higher than some competitors but still competitive within the actively managed ESG emerging market ETF space.

Investment Approach and Strategy:

• Strategy: MESF actively manages its portfolio by selecting individual stocks based on their ESG credentials and growth potential. The portfolio aims to outperform the MSCI Emerging Markets ESG Leaders Net Index.
• Composition: MESF invests primarily in emerging market equities, with a focus on companies in sectors like renewable energy, technology, and healthcare that demonstrate strong ESG practices.

Key Points:

• Actively managed ETF focused on emerging market equities with strong ESG profiles.
• Strong performance since inception, outperforming the benchmark index.
• Experienced and reputable issuer with expertise in sustainable investing.
• Moderate liquidity and competitive expense ratio.

Risks:

• Emerging market risk: Emerging market investments can be more volatile than developed market investments due to political, economic, and currency risk.
• Active management risk: Active management involves a higher degree of risk than passive investing, as the portfolio manager's decisions can significantly impact performance.
• ESG investing risk: The effectiveness of ESG investing strategies depends on the quality of ESG data and analysis, which can be subjective and prone to errors.

Who Should Consider Investing:

MESF is suitable for investors who:

• Seek long-term capital growth potential.
• Believe in the importance of sustainable investing.
• Are comfortable with the risks associated with emerging markets and active management.

Fundamental Rating Based on AI:

8.5 out of 10. MESF exhibits strong fundamentals due to its experienced management team, solid investment strategy, and impressive performance. However, its relatively small market share and slightly higher expense ratio compared to some competitors limit its overall score.

Resources and Disclaimers:

• Matthews International Capital Management: https://www.matthewsim.com/
• Morningstar: https://www.morningstar.com/etfs/gld/mesf/quote
• Nasdaq: https://www.nasdaq.com/market-activity/etfs/mesf

This information should not be considered financial advice. Please conduct your independent research and consult with a financial advisor before making any investment decisions.