Matthews Emerging Markets Discovery Active ETF (MEMS US) – Portfolio Construction Methodology

The investment strategy governing the actively managed Matthews Emerging Markets Discovery Active ETF focuses on smaller company discovery within emerging markets to pursue long term capital appreciation. At least 65% of net assets are invested in common and preferred stocks of Small Companies, with at least 80% invested in issuers located in emerging markets; the remainder may be allocated to mid and large caps to facilitate the strategy. A Small Company is generally one with market capitalization no higher than the greater of USD 5 billion or the largest company in the MSCI Emerging Markets Small Cap Index. Selection emphasizes sustainable growth characteristics including balance sheet strength, cash flow durability, capable management, governance and business model adaptability. The portfolio may invest through depositary receipts, is non diversified, can concentrate its country or sector exposures based on bottom up conviction, and rotates positions as fundamentals or relative opportunity sets evolve.

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