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Matthews India Fund MINDX: A good proxy to invest in India

Many Non Resident Indians (NRIs) and non-Indians face difficulty in investing directly in the Indian stock market. The “Matthews India Fund”, or the MINDX, can be a great option for them to invest in India.



Introduction

The Matthews India Fund, or MINDX, is part of a family of nine funds – Matthews Asian Funds – that invest specifically in the Asian markets.

Out of these nine funds, four focus on particular markets – China (MCHFX), Japan (MJFOX), Korea (MAKOX) and India (MINDX).

The MINDX is an Emerging Market Fund. It can be purchased through most of the brokerages in the United States (USA).

About MINDX

MINDX invests in Indian equities, with the objective of long term capital appreciation. The fund invests at least 80% of its assets in common stocks, preferred stocks and convertible securities of Indian companies. It also invests in the ADRs of Indian companies.

The benchmark for the fund is the Bombay Stock Exchange 100 Index (BSE100). The BSE-100 index comprises of some of the largest companies in India. This means that through your investment in MINDX, you can invest in the largest and the best companies from India. This includes companies like Infosys Technologies, Bharti Airtel, Reliance Communications, Mahindra and Mahindra, Reliance Industries, etc.

MINDX was incorporated on October 31, 2005.

The lead manager for MINDX is Andrew T. Foster, and the fund is co-managed by Sharat Shroff (CFA).


Minimum Investments





Minimum Initial Investment Minimum Subsequent Investment
Regular $2,500 $100
IRA $500 $50
AIP $500 $50

Performance

The current Net Asset Value (NAV) of MINDX is $17.47 (As on June 19, 2008).

The historic returns for the Matthews India Fund (as of March 31, 2008) have been as follows:



One-year 32.10%
Since inception (annualized) 31.98%

The return from the fund in the calendar year 2007 & 2006 was 64.13% and 36.48% respectively.

(Courtesy Google Finance)

The trailing one year return for the fund is 6.92% (as of June 19, 2008). The benchmark for this fund – BSE 100 Index – has given a return of around 9% in the past 1 year. Thus, during the immediately preceding year, MINDX has under-performed its benchmark by a narrow margin.

(Courtesy www.bseindia.com)

The year-to-date (YTD) return for 2008 is -23.98% (as of June 19, 2008), which is in-line with the movement of the Indian stock markets.

The fund gave a dividend of $0.21 on December 6, 2007.

The assets under management for MINDX are US$1.0 billion.


Expenses

MINDX is a no-load fund. That is, it has no front sales load (entry load) and no deferred sales load.

For 2007 (fiscal year ended December 31, 2007), the Gross Expense Ratio for MINDX was 1.28%, and the Portfolio Turnover was 25.59%.

Holdings

96.04% of the assets are invested in stocks, 1.69% in convertible bonds, and the remaining 2.27% assets are invested in other avenues.

The average Price to Earnings (PE) Ratio and Price to Book Value Ratio of its stock holdings are 21.79 and 4.96 respectively.

Top-20 Holdings

  1. Infosys Technologies Ltd.
  2. Dabur India Ltd.
  3. Sun Pharmaceutical Industries Ltd.
  4. Bharti Airtel Ltd.
  5. Gail (India) Ltd.
  6. Glenmark Pharmaceuticals Ltd.
  7. HDFC Bank Ltd.
  8. Cipla Ltd.
  9. Axis Bank Ltd.
  10. Ashok Leyland Ltd.
  11. Hindustan Unilever Ltd.
  12. Reliance Communications Ltd.
  13. Mahindra & Mahindra Ltd.
  14. Corporation Bank
  15. Reliance Industries Ltd.
  16. Wipro Ltd.
  17. CESC Ltd.
  18. Larsen & Toubro Ltd.
  19. Housing Development Finance Corp.
  20. Sintex Industries Ltd.


Quick Facts







Inception Date October 31, 2005
Geographic Focus India
Benchmark Bombay Stock Exchange 100 Index (BSE100)
Fund Assets US$1.0 billion (as of March 31, 2008)
Symbol MINDX
CUSIP 577-130-859

(Note: All the data presented here is as of March 31, 2008, unless otherwise stated)

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