Background on Afores and Their Role
Administradoras de Fondos para el Retiro (Afores) are Mexican pension funds responsible for managing workers’ retirement savings. These funds invest in various financial instruments, such as stocks and government bonds, to generate the highest possible returns and increase workers’ retirement savings.
Afores Performance in the First Half of 2025
Despite market volatility caused by US President Donald Trump’s trade policies, Mexican Afores achieved historic gains of 534.180 million pesos in the first six months of 2025, according to the National Commission for the System of Retirement Savings (Consar).
In June 2025, Afores recorded gains of 82.542 million pesos, a 53% decrease from May’s gains due to Trump’s tariffs affecting financial markets.
Market Performance and Afores Investments
The US and Mexican stock markets gained 5.5% and 16%, respectively, during the first half of 2025, contributing positively to Afores’ investments.
- More than 53% of Afores’ investments are in Mexican government bonds.
- 6% is invested in the Mexican stock exchanges.
- 13% is allocated to international stock exchanges.
Additional investments include private Mexican debt, Fibras, international debt, and other instruments. Afores focus on long-term investments, so monthly or annual performance does not determine their final returns.
Impact of Monetary Policy on Afores
The Bank of Mexico’s (Banxico) interest rate cuts revalued local bond prices, further benefiting Afores’ investment portfolios.
Current Status of Afores
As of the end of June, there were 68.8 million retirement savings accounts in Afores, managing a total of 7.5 trillion pesos.
Key Questions and Answers
- What are Afores? Afores are Mexican pension funds responsible for managing workers’ retirement savings and investing them in various financial instruments to generate returns.
- How did Afores perform in H1 2025 despite Trump’s trade policies? Despite market volatility caused by Trump’s tariffs, Afores achieved historic gains of 534.180 million pesos in the first six months of 2025.
- What percentage of Afores’ investments are in different asset classes?
- More than 53% in Mexican government bonds
- 6% in the Mexican stock exchanges
- 13% in international stock exchanges
- How do monetary policies impact Afores? Banxico’s interest rate cuts have revalued local bond prices, positively affecting Afores’ investment portfolios.
- What is the current status of Afores? As of June’s end, there were 68.8 million retirement savings accounts in Afores, managing a total of 7.5 trillion pesos.
