Matthews Asia portfolio manager Andrew Mattock says broad emerging markets funds offer limited exposure to Chinese AI companies, leaving investors to make a more targeted bet.
Investors hoping to capture the biggest gains from artificial intelligence may need to look beyond the usual emerging markets funds and pay closer attention to China, according to Matthews Asia portfolio manager Andrew Mattock.
Speaking to CNBC, Mattock said broad emerging markets strategies are unlikely to deliver much direct exposure to the theme because the sector is often diluted by holdings in other countries. In his view, the largest gap for investors is the absence of Chinese companies, even in products marketed as diversified ways to play developing markets.
He argued that many mainstream benchmarks leave investors with a patchy picture of the region. South Korean and Taiwanese groups make up a substantial share of the iShares MSCI Emerging Markets ETF, while the iShares MSCI China ETF is not especially geared towards artificial intelligence names, he said. That means investors who want concentrated exposure may need to be more selective than they would with a standard index fund.
Mattock runs the Matthews China Fund, which, according to Matthews Asia, seeks long-term capital appreciation by investing primarily in Chinese companies and must keep at least 80% of assets in Chinese common and preferred shares, including Hong Kong and other administrative regions. As of 30 June 2026, the fund held 55 positions with a weighted average market value of $124.1 billion, and its largest holdings included Tencent Holdings, Alibaba Group Holding and Meituan. Matthews Asia lists the fund’s expense ratio at 1.25%.
Mattock joined Matthews Asia in 2015 after 15 years at Henderson Global Investors, where he managed Asia-Pacific equities in London and Singapore, according to the firm. Before that, he worked at PricewaterhouseCoopers and qualified as a chartered accountant. The fund was down 4% for the year through Friday’s close, underscoring that the AI opportunity in China may still come with volatility, even for investors who are willing to make a more targeted bet.
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