US Videos

This Fund Is Strong Where Its Peers Are Weak

Russel Kinnel

The Morningstar Minute is our quick take on investments, the market, economic indicators, and more. Join us every day for fresh insights from our analyst team.

Russ Kinnel: Matthews Asian Growth & Income is a great fund because it's strong where most emerging-markets funds are weak.

One, it's got greater depth. Matthews is an Asia specialist; you have about 30 managers and analysts at the firm, all focusing on Asia. The fund has low costs; again, emerging-markets funds tend to be overpriced.

But most importantly, it has good defensive characteristics. Because it's looking for growth and income that means they're looking for stocks that pay dividends. They are looking at convertible bonds, preferreds, and even some straight debt. All of that makes the fund more defensive. Because Asian markets tend to have huge swings--you might be up 50% one year, down 40% the next--this fund moderates that so you don't have as much of the downside, but you still got a fair amount of the upside. And if you look at the long-term returns, they are very strong.

It's run by Robert Horrocks, who is the chief investment officer at Matthews. He is fluent in Mandarin and a very seasoned investor, even though his tenure at this particular fund is fairly brief.