Matthews Emerging Markets Discovery Active ETF (MEMS)

ETF Matthews Emerging Markets Discovery Active ETF Summary

Profile: Launched in 2019, Matthews Emerging Markets Discovery Active ETF (MEMD) invests in early-stage and overlooked small and mid-cap companies across emerging markets. It offers diversified exposure across various sectors, such as technology, consumer discretionary, financials, and healthcare. The fund employs an active management approach, seeking undervalued companies with strong growth potential.

Objective: MEMD aims to provide long-term capital appreciation by investing in emerging markets' undiscovered potential.

Issuer: The ETF is issued and managed by Matthews International Capital Management, a global investment management firm with over 40 years of experience and a strong presence in emerging markets.

Market Share: As of October 2023, MEMD holds a market share of approximately 0.5% in the emerging markets small/mid-cap equity ETF category.

Total Net Assets: The ETF currently manages over $150 million in total net assets.

Moat: MEMD's competitive advantage lies in its active management approach, focusing on identifying undervalued companies with strong growth potential. The experienced management team and in-depth knowledge of emerging markets provide a competitive edge.

Financial Performance: Since its inception, MEMD has delivered competitive returns, outperforming its benchmark index. It has exhibited a strong track record of generating alpha, exceeding the performance of the broad emerging markets index.

Growth Trajectory: The ETF is positioned to benefit from the long-term growth potential of emerging markets, particularly in the small and mid-cap segments.

Liquidity: MEMD boasts a healthy average trading volume, ensuring ease of buying and selling shares. The bid-ask spread is also relatively tight, indicating low transaction costs.

Market Dynamics: Economic indicators, sector growth prospects, and current market conditions influence MEMD's market environment. Emerging markets' economic growth, political stability, and increasing investor interest will likely drive the ETF's future performance.

Competitors: Key competitors include iShares MSCI Emerging Markets Small Cap ETF (EEML) and VanEck Vectors Emerging Markets Small-Cap ETF (VWOE).

Expense Ratio: The ETF's expense ratio is 0.85%, which is relatively competitive compared to other actively managed emerging markets small/mid-cap ETFs.

Investment Approach and Strategy: MEMD employs a bottom-up stock selection process, focusing on identifying undervalued companies with strong growth potential. The portfolio holds a diversified mix of stocks across various sectors and countries within emerging markets.

Key Points:

• Actively managed, focusing on undiscovered potential in emerging markets
• Strong track record of outperforming its benchmark
• Experienced management team with deep emerging markets expertise
• Diversified exposure across sectors and countries
• Competitive expense ratio

Risks:

• Emerging markets volatility
• Small-cap stock volatility
• Political and economic risks associated with emerging markets
• Active management risk

Who Should Consider Investing:

• Investors seeking long-term capital appreciation
• Investors comfortable with emerging markets volatility
• Investors looking for exposure to small and mid-cap companies in emerging markets

Fundamental Rating Based on AI:

7/10

MEMD demonstrates strong fundamentals with a competitive edge due to its active management approach and experienced team. However, emerging markets volatility and small-cap stock risks need to be considered.

Resources:

• Matthews International Capital Management website: https://www.matthews.com/
• ETF Database: https://etfdb.com/etf/MEMD
• Morningstar: https://www.morningstar.com/etfs/XNAS/MEMD/quote

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