Matthews Asia has made its long-running Innovators Strategy available in Ucits format.
On Tuesday the firm launched the Matthews Asia Innovative Growth fund managed by Asia equities veteran Michael Oh (pictured) who has been investing in the region for more than 20 years.
The fund’s investment strategy will mirror the $2bn Matthews Asia Innovators fund which is a growth strategy that has invested in “innovative high-quality companies” in the Asia ex Japan region for US investors since 1999.
Oh, who has been managing Asia Innovators since 2006, told Portfolio Adviser the fund focuses on finding innovative companies that benefit from two secular structural growth opportunities in Asia: rising disposable income and the emerging middle class.
He said Asia has the “key ingredients” for innovation-led growth: large addressable markets, substantial entrepreneurial talent and sustainable sources of capital.
When seeking companies for the portfolio, Matthews Asia targets five areas where innovation is driving long-term growth: business model; product and services; business strategy; marketing; and organisational design.
“We have a high conviction belief that innovation is a key driver of creating and also retaining competitive advantages,” Oh said. “Meeting companies on the ground is a key part of our investment process and wherever we dig deeper to investigate what really creates entry barriers and a competitive model, it all comes down to innovation.”
The portfolio will target between 30 and 50 companies and the US strategy currently holds 38 names. It is benchmark agnostic.
Oh said: “We believe that Asian markets are very inefficient and benchmarks tracking Asian markets tend to be backward looking. I believe our portfolio represents the future of Asia.”
The I Acc (GBP) share class has an OCF of 90 basis points.
Matthews Asia chief investment officer Robert Horrocks said: “This strategy has been an early investor in some of today’s most well-known Asian companies, and continues to seek to identify many smaller ‘game changing’ and innovative companies. Our bottom-up fundamental approach is well-suited to identifying the most attractive innovative companies in the region.”
