8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  December 31, 2018

The Mexico Fund, Inc.

(Exact name of registrant as specified in its charter)

Maryland	811-02409	13 306 9854
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

6700 Alexander Bell Drive, Suite 200

Columbia, Maryland 21046

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:

(202) 261-7941  

(none)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under The Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under The Exchange Act (17 CFR 240.13e-4(c))

Item 7.01   Regulation FD Disclosure

Pursuant to Regulation FD Rules 100-103, The Mexico Fund, Inc. (the “Fund”) furnishes the Monthly Summary Report of the Fund’s Investment Adviser.

Item 9.01   Financial Statements and Exhibits

(d)Exhibits

The following exhibit is filed as part of this report:

(i)December 2018 Monthly Summary Report

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	The Mexico Fund, Inc.
Date:  January 8, 2019	By:	/s/ Douglas P. Dick
		Douglas P. Dick
		Secretary

 

EX-99.1

Description

The Mexico Fund, Inc. (the “Fund”) is a non-diversified closed-end management investment company with the investment objective of long-term capital appreciation through investments in securities, primarily equity, listed on the Mexican Stock Exchange. The Fund provides a vehicle to investors who wish to invest in Mexican companies through a managed non-diversified portfolio as part of their overall investment program. The Fund’s shares are listed and traded on the New York Stock Exchange (“NYSE”) under the symbol “MXF.”

Managed Distribution Plan ("MDP")

The Board of Directors of the Fund has authorized quarterly distributions of $0.25 per share under the MDP. With each distribution, the Fund will issue a notice to stockholders and an accompanying press release, which will provide detailed information regarding the amount and composition of the distribution and other information required by the Fund’s MDP exemptive order. The Fund’s Board of Directors may amend or terminate the MDP at any time without prior notice to stockholders. You should not draw any conclusions about the Fund’s investment performance from the amount of distributions or from the terms of the Fund’s MDP.

Highlights

Total Net Assets (million)1	$229.99	Daily Average Number of Shares Traded2	47,122
NAV per share1	$15.33	Outstanding Shares3	15,005,224
Closing price2	$13.25	Expense Ratio (4/30/2018)	1.62%
Discount	13.57%	Portfolio Turnover (4/30/2018)	31.30%

Performance1	Cumulative			Annualized
	1 Month	YTD	1 Year	3 Years	5 Years	10 Years
MXF Market Price	4.41%	-12.22%	-12.22%	-3.25%	-8.80%	7.01%
MXF NAV	3.93%	-12.10%	-12.10%	-3.44%	-6.30%	6.92%
EWW NAV4	2.16%	-16.08%	-16.08%	-4.83%	-7.86%	4.09%
MSCI Mexico Index	3.62%	-14.94%	-14.94%	-3.86%	-7.18%	4.62%

These figures represent past performance. Past performance does not guarantee future results. The Fund's investment return and principal value will fluctuate so that an investor's shares, at the time of sale, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above.

1 Source: Impulsora del Fondo México, S.C. Performance figures take into account reinvestments of distributions.

2 Source: NYSE. Shares traded figure represents average volume traded on U.S. consolidated markets during the month.

3 During December 2018, the Fund repurchased no shares.

4 Source: iShares MSCI Mexico Capped ETF (tracks a Mexico Index produced by MSCI).

 

Top Ten Holdings  (61.74% of Net Assets)
1 América Móvil	14.53%	6 Alfa	4.91%
2 Grupo Financiero Banorte	8.05%	7 Cemex	4.41%
3 Fomento Económico Mexicano	6.72%	8 Ternium	4.36%
4 Grupo México	5.91%	9 Mexichem	4.20%
5 Wal-Mart de México	5.53%	10 Gméxico Transportes	3.12%

Holdings are subject to change and are provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities shown.

Fund Manager´s Comments

During December 2018, most global equity markets registered negative returns. The MSCI Indices of Developed and Emerging Markets decreased 7.7% and 2.9%, respectively, during the month. The U.S. Federal Reserve increased its overnight interest rate by 25 basis points to a range of between 2.25% and 2.50%. In the United States, equity markets decreased sharply with the DJIA and the S&P 500 declining 8.7% and 9.2%, respectively, during the month; the U.S. dollar depreciated 1.1% (measured by the DXY Index¹) and the yield on the U.S. 10-year Treasury note also registered a decrease of 30 basis points to 2.68% during December 2018, the lowest month-end level of 2018. The price of oil (measured by West Texas Intermediate) reached its lowest level of the year and declined 11.1% during the month to $45.4 USD/bbl, despite the agreement between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC members to decrease oil production by 1.2 mbpd.  Despite the decline in most global equity markets, the MSCI Mexico Index increased 3.6% during December 2018 due to the appreciation of the Mexican peso of 3.6% to $19.65.

In local news, the Mexican government announced its 2019 budget that reflected its previously stated expectations of maintaining a solid fiscal regime. The 2019 budget includes an increase in the primary surplus (which excludes interest payments) to 1.0% of GDP, higher than the 0.8% of GDP approved for 2018. The budget announcement generated optimism in the Mexican economy and enhanced the performance of the Mexican peso as indicated above. Separately, Mexico´s Central Bank increased its overnight interest rate by 25 basis points to 8.25%.

During calendar year 2018, the Fund´s NAV outperformed its benchmark and the EWW (the primary ETF tracking the Mexican equity market) by 284 and 398 basis points, respectively, and has also outperformed both during the last three-, five- and ten-year periods.

The information presented in this report has been derived from the sources indicated. Neither The Mexico Fund, Inc. nor its Adviser, Impulsora del Fondo México, S.C., has independently verified or confirmed the information presented herein.

Important Risk Disclosure

All performance shown is historical. Closed-end funds are traded on the secondary market through one of the stock exchanges. Shares of closed-end funds may trade above (premium) or below (discount) the NAV of the fund's portfolio. The NAV is the value of an entity's assets less the value of its liabilities. The Market Price is the current price at which an asset can be bought or sold. There is no assurance that the Fund will achieve its investment objective.

An investment in the Fund entails special risk considerations, including among others the risks of foreign investments, Mexican investments, market illiquidity and volatility, market corrections, risks associated with the Mexican economy, political factors and security, currency exchange rate fluctuations, NAV discount risk, foreign custody risk, dollar denominated investments risk and risks associated with the concentration of the Mexican equity market. Investors should consider their investment goals, time horizons and risk tolerance before investing in the Fund. An investment in the Fund is not appropriate for all investors, and the Fund is not intended to be a complete investment program. Investors should carefully review and consider the Fund's investment objective, risks, charges and expenses before investing.

5 DXY Index computes the value of the U.S. dollar relative to a basket of foreign currencies.