Charles Schwab & Co. has signed up another company for its new mutual fund marketing program.
The San Francisco-based brokerage will help its neighbor, Matthews International Funds, market its new Dragon Century China Fund. In return, Matthews must make the new portfolio available through Schwab's OneSource fund supermarket.
Schwab has entered such deals with only a few companies, including Charlotte-based NationsBank Corp. Last fall the bank jointly marketed with Schwab two index funds from its NationsFund complex.
The program is designed to expose new funds to Schwab's large retail investor and investment adviser base during its subscription period, a spokesman for Schwab said.
For Matthews the "Schwab launch gets it out in front of a tremendous number of retail investors," said Mark Headley, one of the portfolio managers for the new fund.
Mr. Headley said that the new fund will track about 150 Chinese companies that are listed on the Hong Kong, Shenzhen, and Shanghai stock exchanges. The Matthews portfolio is set to launch at the end of next month.
The firm already has three other Asian funds, and is undeterred by market turbulence in Asia. Indeed, according to Mr. Headley, in the last six weeks, the Matthews Korea Fund has quadrupled its assets, to $72 million.
Investors have found better value in the Matthews fund than in Korean- American depositary receipts or closed-end funds, which are priced at premium, he said.
In a separate offering, Schwab this month rolled out a new service to customers and prospective investors. Dubbed Mutual Fund Report Cards, the service provides performance cards on any of the 7,000 funds in the Morningstar data base, the spokesman said.
Schwab takes the customer's fund choice and, using elements from Morningstar's data together with other criteria, issues a report card on its performance.
For example, the cards would compare a fund to a similar portfolio included in the Schwab's Select list-Schwab's list of about 70 of the top- performing funds of the past five years, he said.