The Matthews Asia Credit Opportunities Fund will invest principally in US dollar–denominated high yield bonds from Asian issuers. However, it will also invest selectively in other instruments such as convertibles, local currency bonds, asset backed securities, warrants and equities.
The fund which will be co-lead managed by Teresa Kong and Satya Patel, aims to provide investors with an enhanced yield enhancement and diversified fixed income exposure from across the region.
“Asia has a large and liquid corporate bond market and, as a relatively under-researched asset class, it provides opportunities to potentially benefit not only from attractive levels of yield, but also capital appreciation,” the company said in a statement.
Kong said Asian credits had historically generated higher return than U.S., Euro and Latin American high yield bonds with similar or lower volatility.
“This strategy will appeal to investors seeking a lower risk profile than our equity strategies, yet are comfortable with the risks associated with sub-investment grade debt,” she said.
Matthews Asia said it is the largest dedicated Asia-only investment specialist house in the United States with $26.2bn in assets under management as of 31 August 2015. It employs a bottom-up, fundamental investment philosophy, with a focus on long-term investment performance.