Insight into Matthews China Fund (Trades, Portfolio)'s Q3 2023 Portfolio Changes and Investment Strategy
Matthews China Fund (Trades, Portfolio), with a focus on sustainable growth opportunities within China, has disclosed its N-PORT filing for the third quarter of 2023. The fund, which launched in February 1998, primarily invests in Chinese companies, aiming to capitalize on the fundamental strengths of its chosen investments. This quarter's adjustments reflect the fund's strategic decisions in a dynamic market environment.
New Additions to the Portfolio
Matthews China Fund (Trades, Portfolio) expanded its portfolio with the addition of 4 new stocks. Noteworthy new positions include:
- Luckin Coffee Inc (LKNCY, Financial), with 193,113 shares, making up 1.15% of the portfolio and valued at $6.76 million.
- Yum China Holdings Inc (YUMC, Financial), comprising 118,783 shares, which is about 1.13% of the portfolio, with a total value of $6.62 million.
- Baidu Inc (HKSE:09888, Financial), with 370,750 shares, accounting for 1.07% of the portfolio and a total value of HK$6.24 million.
Significant Position Increases
The fund also raised its stakes in 4 companies, with the most significant increases being:
- Ping An Insurance (Group) Co. of China Ltd (HKSE:02318, Financial), with an additional 1,093,500 shares, bringing the total to 2,031,000 shares. This represents a 116.64% increase in shares, impacting the portfolio by 1.06%, and valued at HK$11.52 million.
- Tencent Music Entertainment Group (TME, Financial), with an additional 597,493 shares, bringing the total to 1,590,127. This adjustment marks a 60.19% increase in shares, with a total value of $10.15 million.
Complete Exits from Holdings
Matthews China Fund (Trades, Portfolio) exited its positions in 3 companies during the third quarter of 2023:
- H World Group Ltd (HTHT, Financial), selling all 204,333 shares, which had a -1.22% impact on the portfolio.
- Threes Company Media Group Co Ltd (SHSE:605168, Financial), liquidating all 500,830 shares, causing a -0.91% impact on the portfolio.
Major Reductions in Holdings
Portfolio adjustments included reducing positions in 34 stocks. The most notable reductions were:
- PDD Holdings Inc (PDD, Financial), with a decrease of 120,876 shares, leading to a -23.65% reduction in shares and a -1.28% impact on the portfolio. The stock traded at an average price of $86.15 during the quarter and has seen a return of 45.38% over the past 3 months and 76.43% year-to-date.
- China Merchants Securities Co Ltd (HKSE:06099, Financial), with a reduction of 6,699,000 shares, resulting in a -57.03% decrease in shares and a -0.97% impact on the portfolio. The stock's average trading price was HK$7.37 during the quarter, with a return of -11.62% over the past 3 months and -14.16% year-to-date.
Portfolio Overview and Sector Allocation
As of the third quarter of 2023, Matthews China Fund (Trades, Portfolio)'s portfolio consisted of 50 stocks. The top holdings included 8.47% in Alibaba Group Holding Ltd (HKSE:09988, Financial), 7.19% in Tencent Holdings Ltd (HKSE:00700, Financial), 6.53% in PDD Holdings Inc (PDD), 4.85% in Meituan (HKSE:03690, Financial), and 4.34% in China Merchants Bank Co Ltd (SHSE:600036, Financial). The fund's investments are well-diversified across 10 of the 11 industries, with significant allocations in Consumer Cyclical, Financial Services, Communication Services, Industrials, and Healthcare, among others.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
