There are some documents in the SEC's Edgar database that look like a draft of the prospectus. Link here:
http://www.sec.gov/Archives/edgar/data/915802/000119312511311116/d254427d485apos.htmLooks like the fund will have Investor and Institutional fund clases with a expense ratios of 1.6% and 1.45%, respectively.
There was also more details on the strategy of the fund (posted bellow). Looks interesting...
"Principal Investment Strategies of the Fund
Under normal market conditions, the Fund seeks to achieve its investment objective by investing at least 80% of its total net assets in dividend-paying common stocks, preferred stocks, convertible securities and debt obligations of foreign companies.
The Fund may invest a significant amount of its net assets (50% to 80% under normal market conditions, measured at the time of purchase) in the securities of companies domiciled in developing countries. The Fund’s investment adviser, Seafarer Capital Partners, LLC (“Seafarer” or the “Adviser”), considers that most Central and South American, African, East and South Asian, and Eastern European nations are developing countries. Currently, these nations include, but are not limited to Brazil, Chile, China, Columbia, Czech Republic, Egypt, Hungary, India, Indonesia, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, South Africa, South Korea, Sri Lanka, Taiwan, Thailand, Turkey and Vietnam.
Seafarer identifies developing countries based on its own analysis and measure of industrialization, economic growth, per capita income, and other factors; it may also consider classifications produced by the World Bank, the International Finance Corporation, the United Nations, and private financial services firms such as FTSE and MSCI.
The Fund may also invest a significant amount of its net assets (20% to 50% under normal market conditions, measured at the time of purchase) in the securities of companies domiciled in selected foreign developed nations, which in the Adviser’s opinion have significant economic and financial linkages to developing countries. Currently, these nations include Australia, Hong Kong, Ireland, Israel, Japan, New Zealand, the United Kingdom and Singapore.
The Adviser determines a company’s location based on a number of factors. A company is generally regarded by the Adviser as being located in a particular country if the company: (i) is organized under the laws of, maintains its principal place of business in, or has, as its principal trading market for the company’s securities, the particular country; (ii) derives 50% or more of its total revenue or profit from either goods or services produced or sales made in the particular country; or (iii) has more than 50% or more of its assets in the particular country.
Exposure to non-U.S. companies through the Fund’s investments in exchange-traded funds (“ETFs”), including ETFs organized under U.S. law, will be included in the Fund’s percentage of total net assets invested in non-U.S. securities.
The Fund may typically invest in convertible securities and debt obligations of any quality or duration. The Fund may generally invest in companies of any size or capitalization, including smaller companies.
The Fund attempts to offer investors a relatively stable means of participating in a portion of developing countries’ growth prospects, while providing some downside protection, in comparison to a portfolio that invests purely in the common stocks of developing countries. The strategy of owning convertible bonds and dividend-paying equities is intended to help the Fund meet its investment objective while reducing the volatility of the portfolio’s returns."
Comments
"Adviser’s Philosophy
Seafarer believes that disciplined active management, applied over a long-term horizon, can enhance investment performance and mitigate portfolio volatility.
Seafarer believes that structural inefficiencies exist within the financial markets of most developing countries. These inefficiencies can give rise to persistent mispricing of individual securities. Such inefficiencies may result from pronounced fluctuations in liquidity conditions, which can distort valuations; alternatively, they may arise from information asymmetries, where market participants misjudge the quality and growth prospects of a given business.
Seafarer further believes that most benchmark indices used to measure the performance of developing markets may incorporate certain shortcomings or biases. These biases mean that popular benchmarks may not fully represent the underlying economic and financial activity that they are supposed to track.
Seafarer thinks the presence of these two anomalies – mispriced individual securities, and benchmarks that incorporate biases – may provide an opportunity to enhance long-term investment performance for the benefit of shareholders.
In order to construct investment strategies, Seafarer typically follows two steps: first, Seafarer seeks to identify and invest in those companies capable of generating sustained growth, but whose prospects have not been widely appreciated by financial markets. Second, Seafarer aims to build diversified and low-turnover portfolios that emulate the characteristics of a reasonable index – one that represents underlying economic activity in global developing markets, and which avoids the biases and shortcomings that Seafarer believes are inherent to standard benchmarks in the developing world.
Seafarer believes that fundamental research on individual companies can provide the means to capitalize on persistent inefficiencies in financial markets. Seafarer constructs portfolios from the “bottom up,” meaning that it selects individual securities based on their specific merits.
Seafarer believes its process is best suited to a long-term investment horizon. Seafarer avoids chasing short-term investment themes or trying to time markets.
Seafarer’s objective is to provide investment strategies that offer sustainable growth, reasonable income, suitable diversification and dampened volatility."
Andrew Foster is the Lead Portfolio Manager of the Fund
Experience
2008 – 2011
Lead Manager of the Matthews Asia Growth and Income Fund (MACSX)
2005 – 2008
Co-Manager of the Matthews Asia Growth and Income Fund (MACSX)
2003 – 2005
Assistant Manager of the Matthews Asia Growth and Income Fund (MACSX)
2005 – 2011
Founder, Lead Manager and Co-Manager of Matthews India Fund (MINDX)
2006 – 2011
Founder, Lead Manager and Co-Manager of Matthews Asia Dividend Fund (MAPIX)
2008 – 2009
Acting Chief Investment Officer, Matthews International Capital Management (San Francisco)
2003 – 2007
Director of Research, Matthews International Capital Management (San Francisco)
1998 – 2001
Investment Analyst, Matthews International Capital Management (San Francisco)
1996 – 1998
Business Analyst, A.T. Kearney (Singapore)
No I do not think this is advertising at all. This board is about Mutual Fund news!
Andrew Foster was lead manager of the wonderful Asian fund, MACSX and also co-manager of MAPIX.....and he was also Research Director (Matthews Asia).
He left to start his own firm (Seafarer Capital) and stated that he was interested in opening a new fund one day. It sounds like he is working on it by the looks of things.
Whether it's in these forums or David Snowball's Monthly Commentaries --- we discuss interesting new up & coming Funds all the time.
I've spoken with Mr. Foster several times in the late fall. For what interest it holds, he's very cognizant for the fund's expense ratio and was interested in learning about strategies for minimizing the fund's overhead. He's committed to doing the right thing for his investors, to the extent he's able to. At the same time, he can't afford to bankrupt himself by underwriting the fund's expenses too much.
I'll talk with Mr. Foster has soon as he's allowed to (i.e., after launch). Given his track record, I'd take this fund quite seriously.
In a side note, Matthews Asian Growth & Income (MACSX), his former fund, had a strong year. It outperformed its peer group every quarter, including the two quarters after his departure. In Q1 and Q4, the peer group lost money while MACSX was in the black. In Q2 (his last), his peer group made money but he made more. In Q3, the fund's losses are about two-thirds of its peers. Not bad, and the fund outperformed 89% of its peers. For the year and for the period after Andrew's departure, the fund very nearly matched the performance of Matthews Asia Dividend (MAPIX).
About the most negative thing you could say is that the fund beat 89% of its peers in a rough year, rather than 99% as it had in 2008.
As ever,
David (who has owned shares of MACSX since its reopening)
BTW, when you say you have owned shares of MACSX since reopening, are you referring to the recent reopening or the previous one?
I'll try to learn a bit more. I bought the fund when it reopened in 2008 and I profiled it as a "star in the shadows."
David
I also agree with you that the initial ER is on the high side, even for the institutional shares.
I'm eagerly looking forward to its launch and hope that Vanguard picks it up soon after launch.
David, thank you for your diligent and dedicated work that you do for so many, and yet are like me, who do not give you enough thanks. Thank you David.
Mike E.