Matthews International Capital Management has launched the Matthews China Dividend Fund, a mutual fund that will invest exclusively in dividend-paying stocks and convertible securities of Chinese companies that are well-positioned to grow future dividends.
The fund will be co-managed by Jesper Madsen and Richard Gao. Madsen is also the lead manager of the Matthews Asia Dividend Fund, and Gao is the lead manager of the Matthews China and Pacific Tiger funds.
“Asia and China, in particular, are becoming increasingly important components to strategic investment decisions for many investors,” said Matthews Chief Investment Officer Robert Horrocks. “For most investors, there is only one way to access these markets: through a growth strategy. And yet, by comparison, we find a wide breadth of U.S. investment strategies. We believe that, similarly, there is more than one way to invest in Chinese equity markets. Strategy matters.”
Matthews noted that over the past 10 years, the universe of dividend-paying companies in China and the rest of Asia has expanded significantly; throughout Asia, it has grown five-fold.
“The bulk of the growth in China’s dividends stems mostly from large, state-owned enterprises that have been listed during the past decade,” Madsen said. “These companies, unlike most U.S. IPOs, are ‘mature’ companies that pay dividends from day one. As a result, China has become one of the largest and fastest-growing markets in Asia in terms of dividend payments.”