This emerging markets fund outperforms by finding ideas in small- and mid-cap companies

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This emerging markets fund outperforms by finding ideas in small- and mid-cap companies
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The Matthews Emerging Markets Small Companies fund gets five stars from Morningstar, and is in the top 1% of funds in its category across 3-, 5- and 10 years.

A keen appreciation for ideas that fly under the radar helped one emerging markets fund outperform during the pandemic. Since starting at the Matthews Emerging Markets Small Companies fund in 2020, Vivek Tanneeru said he has kept his focus on small- and mid-cap companies to generate alpha . The

in the top 4% of funds in its category over the last year, it's in the top 1% of funds among peers across 3-, 5- and 10 years. This year, it's up 3.5%, better than the 2.4% gain in its category, and about in line with the S & P 500. Although Tanneeru has a relatively short tenure at has outpaced its peers over the last three years. In 2022, it fell 16.8%, a decline that was still better than the nearly 20.9% fall in its category, according to Morningstar. In 2021, it jumped 22%, sharply outperforming the 0.4% gain among peers. In 2020, it soared 43.7%, far better than the 17.9% that was seen in the category. Among the winning stocks that helped the fund outperform were beneficiaries of economies reopening post-pandemic.

's top 10 holdings, taking up 4.1% of the portfolio. A cell therapy company developing treatments for multiple myeloma, a type of blood cancer, Legend has operations in China and the U.S., and a collaboration agreement with Janssen Biotech.

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