uploads///Portfolio Breakdown of the MAPTX

Tracking MAPTX’s Portfolio Moves in 2016


Jul. 1 2016, Updated 3:08 p.m. ET

Matthews Pacific Tiger Fund overview

The Matthews Pacific Tiger Fund (MAPTX) aims to invest 80% of its net assets in “common and preferred stocks of companies located in Asia Ex Japan, which consists of all countries and markets in Asia excluding Japan, but including all other developed, emerging, and frontier countries and markets in the Asian region.”

For picking stocks for its portfolio, the fund’s managers look at the following aspects: balance sheet information, number of employees, size and stability of cash flow, management’s depth, adaptability and integrity, product lines, marketing strategies, corporate governance, and financial health.

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The fund’s assets were spread across 63 securities as of March 2016, and it was managing assets worth $6.7 billion in May, making it the largest fund under review in terms of asset size. As of March, its equity holdings included Baidu (BIDU), Lenovo Group (LNVGY), Alibaba Group Holding (BABA), Cognizant Technology Solutions (CTSH), and HDFC Bank (HDB).

Portfolio changes in the Matthews Pacific Tiger Fund

Financials form over one-quarter of MAPTX’s portfolio. Consumer staples follow, occupying about one-fifth of the fund’s assets. Information technology closely tails consumer staples as the third most invested sector. These top three sectors form 65% of the portfolio. The fund is not invested in the energy sector.

Compared to the MSCI All Country Asia ex Japan Index, MAPTX is overweight in the consumer staples sector. Healthcare is another sector in which the fund is markedly overweight compared to the index. Meanwhile, it’s underweight in the financials, information technology, industrials, materials, and telecommunications services sectors.

Stocks from China and Hong Kong combined form 31% of MAPTX’s portfolio. Indian equities are a distant second, followed by South Korean equities. Indonesia and Taiwan round off the fund’s top five invested countries.

There wasn’t much change in MAPTX’s sectoral composition in the 12-month period ended May 2016. Its exposure to the healthcare sector is lower now than it was a year ago, while its exposure to the information technology sector is higher now than it was a year ago.

A distinctive characteristic of the fund is its low portfolio turnover, which shows the conviction of its managers in their stock picks.

With this portfolio positioning, how has MAPTX fared YTD in 2016, and why? Let’s look at that in the next article.


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