8-K: Mexico Fund Reports November Performance, Outperforms Benchmark

The Mexico Fund, Inc. reported its November 2025 performance, with its NAV increasing 3.1% and outperforming the MSCI Mexico Index.

Summary

• The Mexico Fund, Inc. is a non-diversified closed-end management investment company focused on long-term capital appreciation through investments in securities, primarily equity, listed on the Mexican Stock Exchanges.
• Shares are listed and traded on the New York Stock Exchange (NYSE) under the symbol MXF.
• The Fund has a Managed Distribution Plan (MDP) authorizing quarterly distributions of $0.25 per share.
• Total Net Assets as of November 30, 2025, were $327.20 million, with a NAV per share of $22.69 and a closing market price of $19.34.
• The Fund traded at a discount of 14.76% to its NAV.
• Outstanding shares totaled 14,420,065, with a daily average of 39,054 shares traded during November 2025.
• The Expense Ratio as of April 30, 2025, was 1.40%, and Portfolio Turnover was 3.37%.
• For November 2025, the Fund's NAV increased 3.05%, outperforming the MSCI Mexico Index which increased 2.96%.
• Year-to-date, the Fund's NAV increased 41.88%, while the MSCI Mexico Index increased 51.56%.
• Top ten holdings represent 65.84% of Net Assets and include Grupo México, Grupo Financiero Banorte, Fomento Económico Mexicano, and Wal-Mart de México.

Sentiment

Score: 6

Explanation: The Fund demonstrated strong relative NAV performance for November, outperforming its benchmark, and maintains a managed distribution plan. However, the significant discount to NAV and longer-term underperformance against the benchmark, coupled with a contraction in Mexico's Q3 GDP, present notable concerns.

Positives

• The Fund's NAV increased 3.05% in November 2025, outperforming its benchmark, the MSCI Mexico Index, which rose 2.96% for the same period.
• The Mexican peso appreciated 1.4% against the U.S. dollar during November 2025.
• The Fund maintains a Managed Distribution Plan, authorizing quarterly distributions of $0.25 per share to stockholders.
• The Fund has demonstrated strong long-term performance with a 5-year annualized NAV return of 12.99% and a 10-year annualized NAV return of 5.42%.

Negatives

• The Fund's market price performance for November 2025 was -0.26%, significantly lagging its NAV performance of 3.05% and the MSCI Mexico Index's 2.96% gain.
• The Fund's shares traded at a substantial discount of 14.76% to its Net Asset Value as of November 30, 2025.
• Year-to-date, the Fund's NAV performance of 41.88% significantly underperformed the MSCI Mexico Index's 51.56% return.
• Mexico's official GDP for the third quarter of 2025 reported an annual decrease of 0.3%.

Risks

• Risks associated with foreign investments, particularly in Mexico.
• Market illiquidity and volatility.
• Potential for market corrections.
• Risks related to the Mexican economy, political factors, and security.
• Currency exchange rate fluctuations.
• NAV discount risk, where shares may trade below the net asset value.
• Foreign custody risk.
• Risks associated with dollar-denominated investments.
• Risks due to the concentration of the Mexican equity market within the Fund's portfolio.

Future Outlook

The filing primarily provides historical performance data and current market conditions, with no explicit forward-looking statements or guidance from management regarding future performance or strategic direction beyond the stated investment objective.

Management Comments

• Global equity markets registered mixed returns during November 2025, with the MSCI World Index increasing 0.2% and the MSCI Emerging Markets Index decreasing 2.5%.
• The Bank of England maintained its reference interest rate unchanged at 4.0%.
• The DJIA and S&P 500 increased 0.3% and 0.1% respectively, while the yield on the 10-year Treasury note decreased 6 basis points to 4.01%.
• The U.S. dollar depreciated 0.3% (measured by the DXY Index) during November 2025.
• In Mexico, the MSCI Mexico Index increased 3.0%, and the Mexican peso appreciated 1.4% to Ps. $18.30.
• The Fund's NAV increased 3.1%, outperforming its benchmark (MSCI Mexico Index) for the month.
• Mexico's Central Bank (Banxico) decreased its reference interest rate by 25 basis points to 7.25%.
• Mexico's official GDP for the third quarter of 2025 reported an annual decrease of 0.3%, accumulating a growth of 0.5% during the first nine months of 2025.

Industry Context

Global equity markets experienced mixed performance in November 2025, with developed markets showing slight gains while emerging markets faced headwinds. In contrast, the Mexican market, as represented by the MSCI Mexico Index, showed positive momentum and currency appreciation, despite a reported contraction in the country's Q3 GDP. This suggests a complex economic landscape in Mexico, where market performance is somewhat decoupled from recent GDP figures, potentially influenced by the central bank's interest rate cut.

Comparison to Industry Standards

• The Fund's NAV performance of 3.05% in November 2025 was better than its primary benchmark, the MSCI Mexico Index, which returned 2.96% for the same month.
• However, the Fund's year-to-date NAV performance of 41.88% significantly lagged the MSCI Mexico Index's 51.56% return, indicating underperformance over a longer period within the current year.
• Over a 5-year annualized period, the Fund's NAV return of 12.99% slightly underperformed the MSCI Mexico Index's 14.76%.
• Similarly, over a 10-year annualized period, the Fund's NAV return of 5.42% lagged the MSCI Mexico Index's 7.11%.
• The Fund's market price performance consistently underperformed its NAV and the benchmark across most periods, exacerbated by a substantial 14.76% discount to NAV.
• In a broader context, global benchmarks like the MSCI World Index (up 0.2%) and MSCI Emerging Markets Index (down 2.5%) highlight that while Mexico's market showed strength in November, emerging markets generally faced challenges.

Stakeholder Impact

• Shareholders benefit from quarterly distributions of $0.25 per share under the Managed Distribution Plan.
• Shareholders are impacted by the 14.76% discount of the market price relative to NAV, which affects the liquidation value of their holdings.
• Investment performance directly influences shareholder returns, with monthly outperformance but longer-term underperformance against the benchmark.

Next Steps

• The Fund will issue a notice to stockholders and an accompanying press release with each distribution under the Managed Distribution Plan, providing detailed information regarding the amount and composition of the distribution.

Key Dates

Recommendation

While the Fund's NAV outperformed its benchmark in November and it offers a managed distribution, the persistent significant discount to NAV and its underperformance against the benchmark over longer periods (YTD, 5-year, 10-year) warrant a 'hold' recommendation. Investors should monitor if the recent monthly outperformance can be sustained and if the discount to NAV narrows. The contraction in Mexico's Q3 GDP also introduces an element of caution regarding the broader economic environment.

Keywords

Mexico Fund, MXF, closed-end fund, Mexican equities, investment company, capital appreciation, emerging markets, NYSE, financial report, November 2025