Total return measure of performance
For fund performance for our four China-focused mutual funds, we’ll use the total return measure. Total return includes changes in the NAV (net asset value); capital gains distributions, if any; and the reinvestment of those distributions, if that’s what you’ve chosen to do.
Performance evaluation for September 2015
For the one-month period ended September 30, 2015, the Clough China Fund Class A (CHNAX) stands out as the worst performer with a return of -2.2%.
Tencent Holdings (TCEHY), China Mobile (CHL), and CNOOC (CEO) are included in the top ten holdings of CHNAX’s portfolio. CHNAX also invests in American Depositary Receipts of Jumei International Holding (JMEI) and SouFun Holdings (SFUN).
The John Hancock Greater China Opportunities Fund Class A (JCOAX) was down by 1.0% for the same period. However, for the same period, JCOAX and the Matthews China Fund Investor Class (MCHFX) each managed to provide a return of 0.2%.
It’s important to note here that mutual funds have stated benchmarks. While CHNAX and MCHFX have the MSCI China Index as their benchmark, the Fidelity China Region Fund Class C (FHKCX) and JCOAX have the MSCI Golden Dragon Index as theirs.
For the one-month period ended September 30, 2015, the MSCI China Index returned -2.3%, and the MSCI Golden Dragon Index returned -2.7%.
In the next article, we’ll look at which sectors were the best and worst performers for the four China-focused mutual funds.