Matthews Asia Dividend Active ETF (ADVE US) – Portfolio Construction Methodology

The investment process guiding the actively managed Matthews Asia Dividend Active ETF prioritizes durable cash-flow compounding by owning dividend-paying and dividend-growing companies across Asia, with a practical focus on the region’s larger, more liquid markets. Under normal conditions it invests ≥80% of net assets in equities of issuers located in Asian countries and may invest up to 20% in convertible securities of any maturity and credit quality, including below-investment-grade. Security selection is fundamentally driven, emphasizing balance-sheet strength, free-cash-flow durability and governance alongside prospects for dividend sustainability and growth; depositary receipts are eligible. Portfolio construction is unconstrained by sector or country, allowing active concentration where conviction is highest; position sizes reflect liquidity and risk considerations. Currency exposures are generally unhedged. Rebalancing is continuous, with trims or exits when dividend quality deteriorates, valuations compress forward returns, or superior opportunities emerge.

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