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Is Matthews China Fund (MCHFX) a Strong Mutual Fund Pick Right Now?
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China - Equity fund seekers may want to consider taking a look at Matthews China Fund (MCHFX - Free Report) . MCHFX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify MCHFX in the China - Equity category, an area that is rife with potential choices. China - Equity mutual funds almost exclusively target stocks throughout China, Taiwan, and Hong Kong. China has changed drastically over the years, and even though we still associate the country's economy with export-focused manufacturing, it now focuses more than ever on its middle class. If you like the sounds of this investment method, then MCHFX could worth a closer look for your portfolio.
History of Fund/Manager
MCHFX finds itself in the Matthews Asia family, based out of San Francisco, CA. Since Matthews China Fund made its debut in February of 1998, MCHFX has garnered more than $830.53 million in assets. A team of investment professionals is the fund's current manager.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 10.32%, and it sits in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 12.4%, 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. Over the past three years, MCHFX's standard deviation comes in at 20.82%, compared to the category average of 14.83%. The standard deviation of the fund over the past 5 years is 19.36% compared to the category average of 14.16%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, MCHFX lost 60.04% and underperformed comparable funds by 1.27%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.13, so investors should note that it is hypothetically more volatile than the market at large. 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 -2.75, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, MCHFX is a no load fund. It has an expense ratio of 1.09% compared to the category average of 1.53%. From a cost perspective, MCHFX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $100.
Bottom Line
Overall, Matthews China Fund has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
For additional information on the China - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into MCHFX too for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is Matthews China Fund (MCHFX) a Strong Mutual Fund Pick Right Now?
China - Equity fund seekers may want to consider taking a look at Matthews China Fund (MCHFX - Free Report) . MCHFX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify MCHFX in the China - Equity category, an area that is rife with potential choices. China - Equity mutual funds almost exclusively target stocks throughout China, Taiwan, and Hong Kong. China has changed drastically over the years, and even though we still associate the country's economy with export-focused manufacturing, it now focuses more than ever on its middle class. If you like the sounds of this investment method, then MCHFX could worth a closer look for your portfolio.
History of Fund/Manager
MCHFX finds itself in the Matthews Asia family, based out of San Francisco, CA. Since Matthews China Fund made its debut in February of 1998, MCHFX has garnered more than $830.53 million in assets. A team of investment professionals is the fund's current manager.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 10.32%, and it sits in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 12.4%, 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. Over the past three years, MCHFX's standard deviation comes in at 20.82%, compared to the category average of 14.83%. The standard deviation of the fund over the past 5 years is 19.36% compared to the category average of 14.16%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, MCHFX lost 60.04% and underperformed comparable funds by 1.27%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.13, so investors should note that it is hypothetically more volatile than the market at large. 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 -2.75, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, MCHFX is a no load fund. It has an expense ratio of 1.09% compared to the category average of 1.53%. From a cost perspective, MCHFX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $100.
Bottom Line
Overall, Matthews China Fund has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
For additional information on the China - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into MCHFX too for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.