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June 20, 2022. LUXEMBOURG.
Under normal market conditions, the Sub-Fund seeks to achieve its investment objective by investing, directly or indirectly, primarily (i.e., at least 65% of its total net assets) in publicly traded common stocks, preferred stocks and convertible securities of companies Located in or with Substantial Ties to Japan.
1. Name of the Sub-Fund
Matthews Asia Funds – Japan Fund (hereinafter referred to as the “Sub-Fund”).
2. Investment Objective and Policy
The Sub-Fund’s investment objective is to achieve long-term capital appreciation. Under normal market conditions, the Sub-Fund seeks to achieve its investment objective by investing, directly or indirectly, primarily (i.e., at least 65% of its total net assets) in publicly traded common stocks, preferred stocks and convertible securities of companies Located in or with Substantial Ties to Japan. On an ancillary basis, the Sub-Fund may invest in other permitted assets on a worldwide basis. The Sub-Fund promotes environmental and social characteristics according to Article 8 of SFDR. Furthermore, the Sub-Fund uses both activity- and norm-based exclusions. Information relating to the environmental and social characteristics of this Sub-Fund is available in Template III in this Prospectus.
3. Sub-Fund's Risk Profile
The investments in equity securities and other assets the Sub-Fund may invest in involve risks linked to stock markets, including volatility risk, as described in section “Risk Considerations” of the main part of this Prospectus. The Sub-Fund’s investments are subject to market fluctuations. No assurance can, therefore, be given that the Sub-Fund’s investment objective will be achieved. Neither can it be guaranteed that the value of a Share in the Sub-Fund will not fall below its value at the time of acquisition.
The primary benchmark index is the MSCI Japan Index and is indicated for performance comparison only. The Sub-Fund is actively managed and does not aim to replicate or track the primary benchmark. Consequently, the Investment Manager may freely select the securities in which it invests, and the Sub-Fund’s portfolio composition and performance may deviate materially from the primary benchmark.
4. Profile of the Typical Investor
The Sub-Fund is suitable for investors who wish to gain exposure to Japanese equity markets. It is suitable for experienced investors wishing to attain defined investment objectives and accepting volatility that is inherent to equity markets with an investment horizon that is typically 5 years or longer.
5. Base Currency
The Base Currency of the Sub-Fund is the USD.
6. Classes of Shares
- A Class Shares (USD);
- A Class Shares (GBP);
- A Class Shares (EUR);
- A Class Shares (JPY);
- A Class Shares (SGD);
- I Class Shares (USD);
- I Class Shares (GBP);
- I Class Shares (EUR);
- I Class Shares (JPY);
- I Class Shares (SGD);
- S Class Shares (USD);
- S Class Shares (GBP);
- S Class Shares (EUR);
- S Class Shares (JPY);
- S Class Shares (SGD);
- A Hedged Class Shares (USD);
- A Hedged Class Shares (GBP);
- A Hedged Class Shares (EUR);
- I Hedged Class Shares (USD);
- I Hedged Class Shares (GBP); Matthews Asia Funds 20 June 2022
- I Hedged Class Shares (EUR);
- S Hedged Class Shares (USD);
- S Hedged Class Shares (GBP); and
- S Hedged Class Shares (EUR).
Class A Shares and Class A Hedged Shares are available to all investors. Class I Shares and Class I Hedged Shares are subject to higher initial investment minimums than Class A Shares and are only available to investors whose investments meet those minimums or who are otherwise approved by the Fund. Class S Shares and Class S Hedged Shares are only available to investors who are approved by the Fund. Class S Shares and Class S Hedged Shares will only be available until the total net assets of the Sub-Fund reaches or is greater than USD 100,000,000, or any other amount as determined by the Fund (the “Seed Investment Limit”). Upon attaining the Seed Investment Limit, Class S Shares and Class S Hedged Shares may be closed to new investors at the discretion of the Fund.
Class A, Class A Hedged, Class I, Class I Hedged, Class S and Class S Hedged Shares are available in the base currency of the Sub-Fund as well as such other currencies as may be determined by the Directors from time to time.
Although it does not currently intend to do so, the Board of Directors, in its entire discretion, may seek to reduce currency risk from portfolio holdings denominated in local currency by hedging such risk to USD at the Sub-Fund level. The Board of Directors may also seek, in its entire discretion, to reduce currency risk of non USD denominated share classes by hedging USD to the currency of a relevant share class. Any such hedging may be, in full or in part, and may be active or passive. Moreover, the Board of Directors shall have no obligation to hedge. The costs and effects of any such hedging will be reflected in the NAV and in the performance of these classes. With respect to Hedged Share Classes of the Sub-Fund, the Board of Directors seeks to reduce currency risk of each Hedged Share Class by hedging exposure to fluctuations of the Predominant Currency of the Sub-Fund, the Japanese yen (“JPY”), against the Class Currency of the relevant Hedged Share Class, through foreign exchange transactions. For example, Class A, I and S Hedged Shares (USD) of the Sub-Fund will be hedged against JPY to reduce the effect of exchange rate fluctuations between JPY and USD; Class A, I and S Hedged Shares (GBP) of the Sub-Fund will be hedged against JPY to reduce the effect of exchange rate fluctuations between JPY and GBP; and Class A, I and S Hedged Shares (EUR) will be hedged against JPY to reduce the effect of exchange rate fluctuations between JPY and EUR. To achieve this hedging objective, the Investment Manager may, at its absolute discretion, engage, for the exclusive account of and at the cost of each Hedged Share Class, in foreign exchange transactions. The costs and effects of any such hedging will be reflected in the NAV and in the performance of the relevant Classes.
These Classes of Shares may be offered as accumulation (Acc) or distribution (Dist) Shares, in the discretion of the Board of Directors.
7. Offer of Shares
The minimum initial investment and holding amounts are as follows:
(pls refer to pdf https://global.matthewsasia.com/siteassets/resources/fund-documents/prospectus/prospectus-matthewsasiafunds.pdf pg 124 item 7)
Minimum initial investment amounts or minimum subsequent investment amounts will not apply when exchanging or transferring from one share class in a currency or distribution type (i.e., accumulation or distribution) to an equivalent share class in another currency and/or another distribution type within the same Sub-Fund, or when transferring existing holdings from one custody account to another.
Minimum subsequent investment amounts will not apply if a shareholder’s aggregate account balance in a SubFund is greater than the minimum initial investment amount for the share class to be purchased in that same Sub-Fund.
Shares will be issued at the current Net Asset Value per Share of the relevant Class of Shares on every Valuation Day plus any applicable sales charge of up to 5.26% of the applicable Net Asset Value per Share.
8. Applicable Valuation Day for Subscriptions, Redemptions and Conversions
The Net Asset Value per Share in the Sub-Fund is calculated on every Business Day (each a “Valuation Day”).
9. Issue, Conversion and Redemption of Shares
Requests for the issue and conversion of Shares must be received by 12 noon (Luxembourg time) on a Valuation Day in order to be dealt with on that Valuation Day.
Subscription proceeds must be received in full within 3 Business Days following the relevant Valuation Day at the latest.
Requests for the redemption of Shares must be received by 12 noon (Luxembourg time) on the Valuation Day on which the redemption is to be made. Redemption proceeds will generally be paid within 5 Business Days of the relevant Valuation Day.
10. Dividend Policy
In relation to Shares referenced as “Acc” Shares, no distributions will be made and all interests and other income earned by the Sub-Fund will be reflected in the NAV of the Shares. In relation to Shares referenced as “Dist” Shares, it is the intention of the Board of Directors to undertake distributions at least annually. Investors should note that there is no guarantee that a distribution payment will be made for the “Dist” Shares at each period. Investors should read section “Distribution Policy” of the main part of the Prospectus.
11. Fees
The Investment Manager receives a Management Fee, as shown below, calculated as an annual percentage of the NAV of the Sub-Fund on each Valuation Day. Such fees and any and all properly incurred expenses are payable out of the assets of the Sub-Fund monthly in arrears.
In addition, the Investment Manager is entitled to an Administration Fee, as shown below, calculated as an annual percentage of the NAV of the Sub-Fund on each Valuation Day. Such fees and any and all properly incurred expenses are payable out of the assets of the Sub-Fund monthly in arrears. The Administration Fee is for administrative services provided to the Sub-Fund.
The Total Expense Ratio for Class A, Class I and Class S Shares of the Sub-Fund, calculated on each Valuation Day, shall not exceed the per annum percentage of the NAV of the Sub-Fund calculated on each Valuation Day.
(refer to pdf https://global.matthewsasia.com/siteassets/resources/fund-documents/prospectus/prospectus-matthewsasiafunds.pdf page 125)
