December 31, 2020 | Matthewsasia.Com
Total Page：16
File Type：pdf, Size：1020Kb
Matthews Asia Funds | Annual Report December 31, 2020 | matthewsasia.com GLOBAL EMERGING MARKETS STRATEGY Matthews Emerging Markets Equity Fund ASIA FIXED INCOME STRATEGIES Matthews Asia Total Return Bond Fund Matthews Asia Credit Opportunities Fund ASIA GROWTH AND INCOME STRATEGIES Matthews Asian Growth and Income Fund Matthews Asia Dividend Fund '20 Matthews China Dividend Fund ASIA GROWTH STRATEGIES Matthews Asia Growth Fund Matthews Pacific Tiger Fund Matthews Asia ESG Fund Matthews Emerging Asia Fund Matthews Asia Innovators Fund Matthews China Fund Matthews India Fund Matthews Japan Fund Matthews Korea Fund ASIA SMALL COMPANY STRATEGIES Matthews Asia Small Companies Fund Matthews China Small Companies Fund As of January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Funds’ annual and semi-annual shareholder reports are no longer being sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Funds’ website matthewsasia.com, and you will be notified by mail each time a report is posted and provided with a website link to access the report. You may elect to receive paper copies of shareholder reports and other communications from the Funds anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 800.789.ASIA (2742). You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with a Fund, you can call 800.789.ASIA (2742) to let the Fund know you wish to receive paper copies of your shareholder reports. Your election to receive reports in paper will apply to all Funds held in your account if you invest through your financial intermediary or all Funds held directly with Matthews Asia Funds. Investor Class Performance and Expense Ratios (December 31, 2020) (unaudited) 2020 Annual Operating Prospectus Expense Expense Ratios Ratios after Fee after Fee 2020 Waiver Waiver Annual and and Average Annual Total Return† Operating Expense Prospectus Expense Since Inception Expense Reim- Expense Reim- Investor Class 1 year 5 years 10 years Inception Date Ratios* bursement** Ratios‡ bursement‡ GLOBAL EMERGING MARKETS STRATEGY Emerging Markets Equity Fund (MEGMX) n.a. n.a. n.a. 61.23% 4/30/20 2.76% 1.08%1 2.77% 1.15%1 ASIA FIXED INCOME STRATEGIES Asia Total Return Bond Fund (MAINX)§ 5.36% 6.35% n.a. 5.01% 11/30/11 1.15% 1.12%1 1.08% 1.07%1 Asia Credit Opportunities Fund (MCRDX) 1.80% n.a. n.a. 5.16% 4/29/16 1.14% 1.14%1 1.24% 1.12%1 ASIA GROWTH AND INCOME STRATEGIES Asian Growth and Income Fund (MACSX) 16.00% 8.38% 5.37% 9.22% 9/12/94 1.09% 1.09% 1.08% 1.08% Asia Dividend Fund (MAPIX) 31.25% 12.30% 8.46% 9.98% 10/31/06 1.03% 1.02%2 1.03% 1.02%2 China Dividend Fund (MCDFX) 24.22% 13.36% 9.88% 11.06% 11/30/09 1.15% 1.15% 1.15% 1.15% ASIA GROWTH STRATEGIES Asia Growth Fund (MPACX) 46.76% 16.88% 10.48% 11.15% 10/31/03 1.08% 1.08% 1.09% 1.09% Pacific Tiger Fund (MAPTX) 28.83% 12.12% 8.06% 9.20% 9/12/94 1.08% 1.06%2 1.08% 1.05%2 Asia ESG Fund (MASGX) 42.87% 13.87% n.a. 10.65% 4/30/15 1.42% 1.38%3 1.54% 1.38%3 Emerging Asia Fund (MEASX) -2.16% 2.43% n.a. 3.29% 4/30/13 1.75% 1.40%3 1.65% 1.42%3 Asia Innovators Fund (MATFX) 86.72% 22.31% 14.87% 7.05% 12/27/99 1.10% 1.10% 1.19% 1.19% China Fund (MCHFX) 43.05% 17.98% 8.05% 11.20% 2/19/98 1.09% 1.09% 1.09% 1.09% India Fund (MINDX) 16.45% 6.84% 6.10% 10.45% 10/31/05 1.15% 1.15% 1.11% 1.11% Japan Fund (MJFOX) 29.82% 11.80% 10.66% 7.19% 12/31/98 0.95% 0.95% 0.93% 0.93% Korea Fund (MAKOX) 40.77% 8.88% 8.38% 6.79% 1/3/95 1.19% 1.19% 1.15% 1.15% ASIA SMALL COMPANY STRATEGIES Asia Small Companies Fund (MSMLX) 43.68% 12.21% 6.66% 12.25% 9/15/08 1.57% 1.39%3 1.60% 1.41%3 China Small Companies Fund (MCSMX) 82.52% 25.05% n.a. 12.48% 5/31/11 1.52% 1.43%3 1.62% 1.38%3 † Annualized performance for periods of at least one year, otherwise cumulative. * Before fee waivers and expense reimbursement. ** Expense ratio represents the actual expense ratio a shareholder would have paid if they had been invested the entire year. ‡ These figures are from the Funds’ prospectus dated as of April 29, 2020, and may differ from the actual expense ratios for fiscal year 2020, as shown in the financial highlights section of this report. § The Fund’s name changed from Matthews Asia Strategic Income Fund to Matthews Asia Total Return Bond Fund on January 31, 2020. 1 Matthews has contractually agreed (i) to waive fees and reimburse expenses to the extent needed to limit Total Annual Fund Operating Expenses (excluding Rule 12b-1 fees, taxes, interest, brokerage commissions, short sale dividend expenses, expenses incurred in connection with any merger or reorganization or extraordinary expenses such as litigation) of the Institutional Class to 0.90% first by waiving class specific expenses (i.e., shareholder service fees specific to a particular class) of the Institutional Class and then, to the extent necessary, by waiving non- class specific expenses (e.g., custody fees) of the Institutional Class, and (ii) if any Fund-wide expenses (i.e., expenses that apply to both the Institutional Class and the Investor Class) are waived for the Institutional Class to maintain the 0.90% expense limitation, to waive an equal amount (in annual percentage terms) of those same expenses for the Investor Class. The Total Annual Fund Operating Expenses After Fee Waiver and Expense Reimbursement for the Investor Class may vary from year to year and will in some years exceed 0.90%. Pursuant to this agreement, any amount waived for prior fiscal years with respect to the Matthews Asia Total Return Bond Fund and the Matthews Asia Credit OpportunitiesFundisnotsubjecttorecoup- ment. For the Matthews Emerging Markets Equity Fund, if the operating expenses fall below the expense limitation in a year within three years after Matthews has made a waiver or reimbursement, the Fund may reimburse Matthews up to an amount that does not cause the expenses for that year to exceed the lesser of (i) the expense limitation applicable at the time of that fee waiver and/or expense reimbursement or (ii) the expense limitation in effect at the time of recoupment. This agreement will remain in place until April 30, 2022 and may be termi- nated at any time by the Board of Trustees on behalf of the Fund on 60 days’ written notice to Matthews. Matthews may decline to renew this agreement by written notice to the Trust at least 30 days before its annual expiration date. 2 Matthews has contractually agreed to waive a portion of its advisory fee and administrative and shareholder services fee if the Fund’s average daily net assets are over $3 billion, as follows: for every $2.5 billion average daily net assets of the Fund that are over $3 billion, the advisory fee rate and the administrative and shareholder services fee rate for the Fund with respect to such excess average daily net assets will be each reduced by 0.01%, in each case without reducing such fee rate below 0.00%. Any amount waived by Matthews pursuant to this agreement may not be recouped by Matthews. This agreement will remain in place until April 30, 2022 and may be terminated (i) at any time by the Board of Trustees upon 60 days’ prior written notice to Matthews; or (ii) by Matthews at the annual expiration date of the agreement upon 60 days’ prior written notice to the Trust, in each case without payment of any penalty. 3 Matthews has contractually agreed (i) to waive fees and reimburse expenses to the extent needed to limit Total Annual Fund Operating Expenses (excluding Rule 12b-1 fees, taxes, interest, brokerage commissions, short sale dividend expenses, expenses incurred in connection with any merger or reorganization or extraordinary expenses such as litigation) of the Institutional Class to 1.20% first by waiving class specific expenses (i.e., shareholder service fees specific to a particular class) of the Institutional Class and then, to the extent necessary, by waiving non- class specific expenses (e.g., custody fees) of the Institutional Class, and (ii) if any Fund-wide expenses (i.e., expenses that apply to both the Institutional Class and the Investor Class) are waived for the Institutional Class to maintain the 1.20% expense limitation, to waive an equal amount (in annual percentage terms) of those same expenses for the Investor Class. Beginning on December 1, 2020 for the Matthews Emerging Asia Fund, Matthews voluntarily reduced this expense limitation to 1.10% for the Institutional Class andwaivedacorrespondingamount (in annual percentage terms) for the Investor Class.