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Is Matthews China Fund (MCHFX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a China - Equity fund? Well, Matthews China Fund (MCHFX - Free Report) would not be a good potential starting point right now. MCHFX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
MCHFX is one of many China - Equity mutual funds to choose from. These funds focus their investments almost exclusively on stocks in China, Taiwan, and Hong Kong. We tend to associate the Chinese economy with vast export-focused manufacturing, and although this is still important, China is increasingly catering to its booming middle class. If this approach sounds appealing to you, MCHFX could be the way to go.
History of Fund/Manager
Matthews Asia is based in San Francisco, CA, and is the manager of MCHFX. Matthews China Fund made its debut in February of 1998, and since then, MCHFX has accumulated about $567.34 million in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 3.06%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.9%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 14.28%, the standard deviation of MCHFX over the past three years is 21.4%. The fund's standard deviation over the past 5 years is 20.89% compared to the category average of 15.01%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, MCHFX lost 60.04% and outperformed its peer group by 1.27%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. MCHFX has a 5-year beta of 1.16, which means it is likely to be more volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. With a negative alpha of -4.76, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, MCHFX is a no load fund. It has an expense ratio of 1.05% compared to the category average of 1.50%. From a cost perspective, MCHFX is actually cheaper than its peers.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Bottom Line
Overall, Matthews China Fund ( MCHFX ) has a low Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
Want even more information about MCHFX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.
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Is Matthews China Fund (MCHFX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a China - Equity fund? Well, Matthews China Fund (MCHFX - Free Report) would not be a good potential starting point right now. MCHFX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
MCHFX is one of many China - Equity mutual funds to choose from. These funds focus their investments almost exclusively on stocks in China, Taiwan, and Hong Kong. We tend to associate the Chinese economy with vast export-focused manufacturing, and although this is still important, China is increasingly catering to its booming middle class. If this approach sounds appealing to you, MCHFX could be the way to go.
History of Fund/Manager
Matthews Asia is based in San Francisco, CA, and is the manager of MCHFX. Matthews China Fund made its debut in February of 1998, and since then, MCHFX has accumulated about $567.34 million in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 3.06%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.9%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 14.28%, the standard deviation of MCHFX over the past three years is 21.4%. The fund's standard deviation over the past 5 years is 20.89% compared to the category average of 15.01%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, MCHFX lost 60.04% and outperformed its peer group by 1.27%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. MCHFX has a 5-year beta of 1.16, which means it is likely to be more volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. With a negative alpha of -4.76, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, MCHFX is a no load fund. It has an expense ratio of 1.05% compared to the category average of 1.50%. From a cost perspective, MCHFX is actually cheaper than its peers.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Bottom Line
Overall, Matthews China Fund ( MCHFX ) has a low Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
Want even more information about MCHFX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.