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Matthews Emerging Markets Equity Fund
MEGMX

(Also Available as an ETF: MEM)
Snapshot
  • Seeks Alpha in Global Emerging Markets—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

04/30/2020

Inception Date

-0.08%

YTD Return

(as of 04/22/2025)

$13.05

NAV

(as of 04/22/2025)

+0.20

1 Day NAV Change

(as of 04/22/2025)

Portfolio Managers

Sean Taylor photo
Sean Taylor

Co-Manager

Sean Taylor

Chief Investment Officer and Portfolio Manager

Sean Taylor photo

Sean Taylor is Chief Investment Officer and Portfolio Manager at Matthews. As Chief Investment Officer, Sean oversees the firm’s investment process and investment professionals and sets the research agenda for the investment team. He manages the firm’s Pacific Tiger and Asia ex Japan Total Return Equity Strategies and co-manages the firm’s Emerging Markets Equity and Emerging Markets ex China Strategies. Prior to joining Matthews in October 2023, he was Chief Investment Officer APAC, Global Head of Emerging Markets Equity at DWS Group based in Hong Kong since he joined the company in 2013. From 2004 to 2011, he was an Investment Director at GAM, based in London and Dubai. From 1997 to 2004, he was at Societe Generale as Head of International and Emerging Markets. Sean has 30 years of experience, including more than a decade as CIO. He oversaw a number of emerging markets active strategies, including Latin America, India, China, Brazil, Russia as well as international and global strategies. He received his MBA from Manchester Business School and is a graduate of the Royal Military Academy, Sandhurst.

Jeremy Sutch, CFA photo
Jeremy Sutch, CFA

Co-Manager

Jeremy Sutch, CFA

Portfolio Manager

Jeremy Sutch, CFA photo

Jeremy Sutch is a Portfolio Manager at Matthews and co-manages the firm’s Emerging Markets Equity, Emerging Markets ex China Equity, Emerging Markets Small Companies, Emerging Markets Discovery, Asia Small Companies, Asia ex Japan Total Return Equity and Pacific Tiger Strategies. Prior to joining Matthews in 2015, he was Director and Global Head of Emerging Companies at Standard Chartered Bank in Hong Kong from 2012 to 2015, responsible for the fundamental analysis of companies in Asia, with a particular focus on small- and mid-capitalization companies. From 2009 to 2012, he was Managing Director at MJP Capital in Hong Kong, which he co-founded. His prior experience has included managing small-cap equities at Indus Capital Advisors and serving as Head of Hong Kong Research for ABN AMRO Asia Securities. Jeremy earned an M.A. in French and History from the University of Edinburgh.

Commentary

Period ended December 31, 2023
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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 while China’s performance was impacted by a tit-for-tat escalation of tariffs with the U.S. 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 Matthews Emerging Markets Equity Fund returned 11.75%, (Investor Class) and 11.84% (Institutional Class) while its benchmark, the MSCI Emerging Markets Index, returned 12.20% over the same period.
  • On a country basis, the top three contributors to relative performance were Saudi Arabia due to zero allocation, South Korea due to an overweight allocation and India due to stock selection. The top three detractors were China/Hong Kong due to an overweight allocation and stock selection, Singapore due to stock selection and United Arab Emirates due to an underweight allocation and stock selection.
  • On a sector basis, the top three contributors to relative performance were financials and information technology (IT) due to stock selection and energy due to an underweight allocation. The top three detractors were industrials due to an underweight allocation and stock selection, consumer discretionary due to an overweight allocation and consumer staples due to stock selection.
  • The largest contributors to absolute performance included Taiwan Semiconductor Manufacturing Co. (TSMC), a globally leading chipmaker, SK Hynix, a South Korean semiconductor company, and Hana Financial Group Inc., a South Korean financial services company. The top three detractors included JD.com, a leading e-commerce platform in China, Meituan, China’s largest food delivery service and internet platform company, and Alibaba Group, the largest e-commerce platform company in China.

Outlook

  • With President Trump’s July 9 tariff 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. In China, while a meaningful pickup in property and general consumption has yet to be seen, we anticipate some progress later in the year and into 2026.
  • 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.

View the Fund's Top 10 holdings as of June 30, 2025. Current and future holdings are subject to change and risk.

Average Annual Total Returns - MEGMX as of 12/31/2024
1YR 3YR 5YR 10YR Since Inception Inception Date
11.13% -1.61% N.A. N.A. 9.48% 04/30/2020
Fees & Expenses
Gross Expense Ratio 1.58%
Net Expense Ratio 1.08%

Matthews has contractually agreed to waive fees and reimburse expenses to limit the Total Annual Fund Operating Expenses until April 30, 2026. Please see the Fund’s prospectus for additional details.

Investments in emerging and frontier securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. Additionally, investing in emerging and frontier markets countries are substantially smaller, less liquid and more volatile than securities markets in more developed markets.