China Fund Stock Price, News & Analysis

The China Fund, Inc. (ticker symbol CHN) is a closed-end management investment company that has focused on the equity markets connected to the People's Republic of China. According to the Fund's public disclosures, its stated objective has been to seek long-term capital appreciation by investing primarily in equity securities linked to China. Shares of the Fund have been listed on the New York Stock Exchange under the symbol CHN.

The Fund's investment approach, as described in its releases, centers on equity securities of two main types of companies: those for which the principal securities trading market is in China, and those for which the principal securities trading market is outside of China or that are organized outside of China but maintain substantial economic ties to China. In each case, the Fund has targeted companies that derive at least 50% of their revenues from goods and services sold or produced in China, or that have at least 50% of their assets in China. While the Fund is permitted to invest in direct equity investments of companies organized in China, it has disclosed that it has, at times, held no such direct investments.

The China Fund, Inc. is organized as a Maryland corporation and is registered as a management investment company. It has described itself as a closed-end fund, meaning that it issues a fixed number of shares that trade on an exchange, rather than continuously issuing and redeeming shares at net asset value. The Fund has reported that its investment manager is Matthews International Capital Management, LLC, which is responsible for managing the Fund's portfolio within the parameters of its investment objective and policies.

Historically, the Fund has benchmarked its performance against China-focused equity indices. In its public communications, it has referenced the MSCI China All Shares Index as a performance benchmark, describing that index as capturing large- and mid-cap representation across various China share classes and listings. The Fund has also noted that it invests across companies operating in diversified sectors, provided those companies meet its revenue or asset thresholds related to China.

In addition to its core investment objective, the Fund has implemented policies and programs intended to address the trading characteristics of its shares. For example, it has described a Discount Management Program under which the Fund may repurchase a portion of its common shares in open market transactions when the shares trade at a specified discount to net asset value, subject to conditions and procedures adopted by the Board of Directors. The Fund has also disclosed a conditional performance tender offer policy, under which it may conduct a performance-based tender offer for a portion of its outstanding shares if its investment performance over a defined multi-year period does not equal or exceed that of its benchmark index, subject to the Board's determination that such an offer would be in the best interests of the Fund and its stockholders.

Over time, the Board of Directors has considered the Fund's size, trading volume, discount to net asset value, performance, and broader geopolitical and market conditions affecting Chinese securities. In a definitive proxy statement and related communications, the Board explained that it evaluated alternatives such as converting the Fund into an open-end management investment company or changing the Fund's investment objective and principal investment strategy. After this review, the Board unanimously determined that liquidation and dissolution of the Fund pursuant to a Plan of Liquidation and Dissolution was advisable and recommended that stockholders approve this course of action.

Stockholders subsequently approved the liquidation and dissolution of The China Fund, Inc., as reported in a Form 8-K filing and accompanying press release. Under the approved Plan of Liquidation and Dissolution, the Fund will liquidate its portfolio, wind up its business and affairs, pay or provide for its liabilities and expenses (including costs associated with disposing of portfolio assets and the expenses of the liquidation), and distribute its remaining assets to stockholders in one or more liquidating distributions. Once the Fund commenced liquidating its portfolio, it disclosed that it would no longer pursue its stated investment objective, comply with its investment limitations, or engage in normal business activities, except as necessary to implement the Plan and complete the winding-up process.

In connection with the liquidation process, the Fund has stated that it expects stockholders of record as of a specified determination date to receive cash distributions equal to the Fund's net asset value after payment or provision for charges, taxes, expenses, and liabilities, including costs associated with the liquidation. The Fund has also indicated that the liquidation and related distributions generally constitute a taxable event for stockholders subject to U.S. federal income tax, and has urged investors to consult their tax advisors regarding the specific tax consequences.

The Fund's shares have been removed from listing on the New York Stock Exchange. A Form 25 filed with the U.S. Securities and Exchange Commission by the NYSE identifies The China Fund, Inc. as the issuer and CHN common stock as the class of securities removed from listing and registration under Section 12(b) of the Securities Exchange Act of 1934. This filing reflects that the Fund's shares have ceased trading on the NYSE in connection with the liquidation process described in the Fund's proxy materials and current reports.

For investors and researchers, The China Fund, Inc. represents an example of a specialized closed-end fund focused on China-related equity securities that ultimately elected to liquidate and dissolve after considering its scale, trading characteristics, and the market environment. Its public filings and disclosures provide detail on its investment objective, benchmark usage, discount management and performance policies, and the legal and procedural steps involved in winding down a registered closed-end fund.