Investment Regime

---

Summary of limits contained in the Investment Regime applicable to SIEFOREs pension funds, as per Disposiciones que establecen el régimen de inversión al que deberán sujetarse las SIEFORES.*  

				Limits by type of Basic SIEFORE (fund)
				Basic Initial	Basic 95-99	Basic 90-94	Basic 85-89	Basic 80-84	Basic 75-79	Basic 70-74	Basic 65-69	Basic 60-64	Basic Pension
Trimestre				1	1	20	40	60	80	100	120	140	161
Market and Liquidity Risks		Value at Risk /2										0.91%	0.70%
		Difference of the Conditional Value Risk /2		1.30%	1.30%	1.27%	1.24%	1.18%	1.04%	0.79%	0.53%	0.24%	0.10%
		Liquidity coverage ratio /3		80%
		Tracking Error /4		5%
Risk by issuer / Counterparty or concentration /5	Local /6	Debt issued or endorsed by the Federal Government		100%
		SPE /6 Debt		10% (mxBBB to mxAAA) (Foreign exchange BB to AAA)
		Debt		5% (mxBBB to mxAAA) (Foreign exchange BB to AAA)									5% (mxA- to mxAAA) (Foreign exchange BBB+ to AAA)
		Subordinated Debt		1% (mxBB+ to mxBBB-) (Foreign exchange B+ to BB-)									-
		Hybrid Debt		2% (mxBBB to mxBBB+) (Foreign exchange BB to BB+)									-
	Inter	Foreign instrument from one issuer or counterparty/7		5% (BBB- to AAA)									5% (BBB+ to AAA)
		Holdings of a single issuance /8		---Maximum { 35%, 120 MILLION UDI }---
		Mexican REITs (FIBRAS) /13 and REITs		2%
		Structured securities /12		3%
Assets Class limits		Foreign Securities /5		20%
		Equity /5/10		60.00%	60.00%	58.31%	56.10%	53.27%	49.65%	43.67%	34.76%	19.57%	15.00%
		Foreign Currency /5		35.00%	35.00%	34.46%	33.75%	32.84%	31.65%	28.73%	24.58%	17.61%	15.00%
		Securitizations/5/11		40.00%	40.00%	38.39%	35.95%	33.13%	30.29%	26.87%	23.26%	20.82%	20.00%
		Structured securities/5/12		20.00%	20.00%	20.00%	20.00%	20.00%	20.00%	17.29%	14.57%	11.71%	10.00%
		Mexican REITs (FIBRAS)/13 and REITs		10.00%	10.00%	10.00%	10.00%	10.00%	10.00%	8.64%	7.21%	5.79%	5.00%
		Inflation protected securities/14		-									Min 51%
		Commodities/5		5%
Vehicles and Derivatives		Investment Mandates		Yes
		Derivatives		Yes
Conflicts of interest /5		Securities by related entities	15%
		Securities by entities with patrimonial affiliation with the AFORE/15	5%

 

Applicable Limits for Modifications and Additions to the “Disposiciones de Carácter General que establecen el régimen de inversión al que deberán sujetarse las Sociedades de Inversión Especializadas de Fondos para el Retiro” as of October 28th, 2024

 

*This is a summary of the Basic SIEFORE's current regulation and it is for explanatory purposes only. Additional SIEFORE's (e.g. voluntary savings) can determine different parameters according to their prospectus and in compliance with the SAR Law.

1. All limits represent maximum percentages, with the exception of the inflation protection limit.
2. As a percentage of SIEFORE assets under management (AUM), the limits for the Difference of the Conditional VaR may be adjusted by the Risk Analysis Committee when appropriate, which might be more rigorous than the limits established in the Investment Regimen guidelines.
3. As a percentage of the High Liquid Assets of the SIEFORE. It is defined as the ratio between the Value of the SIEFORE's reserves for derivatives exposure and the Value of High Liquid Assets.
4. Calculated in accordance with the methodology provided in the “Disposiciones de Carácter General en Materia Financiera de los Sistemas de Ahorro para el Retiro”. The Tracking Error may have a range of modification determined by the Risk Analysis Committee.
5. As a percentage of SIEFORE AUM’s, including the assets managed by Investment Mandates.
6. Rating of the medium- and long-term issuances, as well as the issuer and/or endorser, in the corresponding proportion. Repos and derivatives are computed in these limits, as well. SPE stands for State Productive Enterprises.
7. Investment in foreign instruments with a rating no less than BBB- are allowed, however the SIEFORES must comply with the “Disposiciones del Régimen de Inversión y en las Disposiciones en materia financiera”.
8. 35%  Applies to the asset holdings of all SIEFORE’s managed by the same AFORE in Debt, Foreign Debt Securities, Securitized Instruments, ABS’s, Mutual Funds and FIBRAS. For Debt Instruments, Foreign Debt Securities and Securitized Instruments, SIEFORES may acquire the value that is greater between one hundred and twenty million UDIS and 35% of the same issue. The investment in CKDs and CERPIs may exceed this limit, under certain conditions. The maximum amount will be updated in accordance with the “Disposiciones de Carácter General en Materia Financiera de los Sistemas de Ahorro para el Retiro
9. The limits represent the maximum limit that each asset will take during the trajectory.
10. Includes individual shares, IPOs, domestic and international equity indexes and warrants included in the list of Indexes, and bonds mandatorily convertible into shares of domestic issuers. The Basic Pension SIEFOREs must comply with the provisions stablished in the “Disposiciones del Régimen de Inversión y en las Disposiciones de Carácter General en Materia Financiera.”.
11. Securitizations fulfilling criteria established in the Appendix R of the “Disposiciones de Carácter General en Materia Financiera de los Sistemas de Ahorro para el Retiro” are computed in these limits, and are considered as being issued by an independent issuer.
12. Includes CKDs and CERPIs.
13. Includes Mexican REITs (FIBRAS) and FIBRA-E. The latter is an issuer trust whose resources will be allocated for direct or indirect investment in companies, projects or energy assets or infrastructure.
14. Minimum investment limit in securities that ensures a return equal or greater than the inflation rate in México.
15. The  limits are written down in the Pension System Law, Art 48 / 10. In exceptional cases it could be increased up to 10%. In the case of financial entities with equity links, the limit is 0%.

 

Versión en Español