MXE’S Portfolio Allocation
|
January 31, 2013
|
March 15, 2013
|
Equities
|
86.47%
|
81.07%
|
Mexican REITS
|
7.22%
|
8.91%
|
US dollar Denominated Bonds
|
1.55%
|
2.34%
|
MXN pesos Denominated Bonds
|
2.03%
|
3.96%
|
Overnight Instruments
|
0.73%
|
1.68%
|
Private Equity Fund
|
2.00%
|
2.04%
|
i)
|
Mexico’s undisputed story of macroeconomic stability for more than a decade.
|
ii)
|
The support the Peña Nieto administration mustered from all three political parties to launch the “Pacto por Mexico” on December 2, 2012. The Pact details long-awaited structural reform initiatives (labor, education, public administration, telecommunications, fiscal, financial and energy) that will be voted on in Congress according to a specific timetable.(See: Exhibit G).
|
Total Annual Average Dollar Return
|
|||||||
(dividends reinvested)
|
|||||||
Since
|
|||||||
1 Month
|
6 Month
|
1 Year
|
3 Years
|
5 Years
|
10 Years
|
Inception In
|
|
FUND
|
August 30, 1990
|
||||||
MXE NAV
|
6.41%
|
25.54%
|
41.92%
|
25.35%
|
5.63%
|
23.31%
|
15.85%
|
MXE Market Price
|
10.53%
|
31.79%
|
45.75%
|
29.06%
|
9.18%
|
25.35%
|
14.89%
|
MSCI Mexico Index
|
5.51%
|
16.46%
|
26.76%
|
17.61%
|
6.73%
|
20.56%
|
13.37%
|
Excess Return (bps)
|
90
|
908
|
1,516
|
774
|
-110
|
275
|
248
|
i)
|
PAM’s systematic investment strategy factors.(See: PAM’s web page: paminversion.com/English).
|
ii)
|
An investment strategy based on three equity class categories, as classified by PAM (Alpha, Beta and Special Situations) set up at the beginning of 2009, as well as PAM’s adherence to systematic investment strategy factors.
|
iii)
|
A highly diversified portfolio.
|
Category
|
% Overall Portfolio
|
Sectors and Equity Class Categories as classified by PAM
|
Small
|
12%
|
Financials, discretionary consumption and car insurance
|
Medium
|
26%
|
Discretionary consumption and industrials
|
Large
|
56%
|
Materials, industrials and discretionary consumption
|
Alpha
|
23%
|
High total return, dividend + share purchase + capital increase
|
Beta
|
47%
|
Infrastructure related with internal free cash flow
|
Special Situation
|
17%
|
Value-oversold stocks. Below its intrinsic value and determined by PAM. Less than 1 times P/BV
|
i)
|
REITs. High yield real estate investment trusts:
|
GLA
|
Dividend
|
One-year
|
||||
million
|
Market Cap
|
EV/EBITDA
|
yield
|
return to
|
||
Name
|
square feet
|
Cap rate %
|
billion USD
|
2013e
|
2013e
|
Jan. 31, 2013
|
Fibra Uno
|
8.19
|
4.7
|
5.06
|
21.5
|
3.80%
|
67.25%
|
Vesta
|
12.5
|
6.5
|
0.789
|
16.8
|
2.70%
|
78.19%*
|
Funo is a real estate trust, approximately 45% industrial, 40% commercial and 15% office, with a 8.19 million square feet GLA (gross leasable area). Funo’s estimated 2014 and 2015 annual dividend yields are 4% and 5% according to Santander Mexico.
|
||
VESTA is a real estate corporation. It is a leading developer of industrial real estate properties with a strong presence in several strategic markets located in key logistic and trade corridors. (Bombardier). Vesta projections include doubling its existing GLA over the next three years. (Source: Santander Mexico).
|
||
ii)
|
Private Equity. ADMEXCK-09 is the private equity trust Discovery Americas managed by Atlas Capital (Harry Krensky and Carlos Mendoza former Officer of Nafinsa, a development bank in Mexico) launched on December 24, 2009, with a total initial capital of approximately US $90 million. Private equity trusts are listed in the Mexican market in the form of CKD’s (Development Companies).
|
|
Since its inception, the trust has invested in five companies in the health, education, school buses, freight transport and low airline carrier sectors. Two of these companies are leaders in their sectors. Approximately 60% of the ADMEXCK-09 total assets are currently invested in underlying companies.
|
Consumer Price Index
|
Annual Inflation Forecasts
|
||
(Annual growth, %)
|
(%)
|
||
Source: Central Bank, INEGI, SHCP, SHF.
|
Capitalization Index of Mexican banks
|
Housing Relative Prices
|
|
(Jan-12, %)
|
(relative to the CPI, index / -07=100)
|
|
Source: Central Bank Survey, SHCP.
|
Current Account Balance
|
Foreign Exchange Reserves
|
|
(% of GDP)
|
(billion USD)
|
|
Source: Central Bank, SHCP.
|
Mexican
|
||||
Participation of Mexico
|
Non-Oil Exports
|
Participation of Mexican
|
||
Exports in US Imports
|
(Annual growth, 3m
|
Non-Oil Exports to US
|
||
(Non-oil, annual average, %)
|
moving average, %)
|
(% of total Non-oil exports)
|
||
Source: Central Bank, SHCP, U.S. Census Bureau.
|
•
|
Mexbol Total Return Index is the Mexican Bolsa index that calculates the performance of constituents assuming that all dividends and distributions are reinvested. The Mexican Bolsa Index, MEXBOL or the IPC (Indice de Precios y Cotizaciones), is a capitalization-weighted in dex of the leading stocks traded on the Mexican Stock Exchange. The index was developed with a base level of 0.78 on October 30th, 1978.
|
•
|
MSCI MEXICO-Index: The Morgan Stanley Capital International Index Mexico is a capitalization weighted index that monitors the perfor mance of stocks traded in Mexico.
|
•
|
S&P Index: An index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe.
|
•
|
DJI: The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.
|
•
|
VIX Index: The Chicago Board Options Exchange Volatility Indez reflects a market estimate of future volatility, based on the weighted average of the implied volatilities for a wide range of strikes.
|
•
|
Cap rate: Capitalization rate is a rate of return on a real estate investment property based on the expected income that the property will generate. Capitalization rate is used to estimate the investor’s potential return on his or her investment. This is done by dividing the income the property will generate (after fixed costs and variable costs) by the total value of the property.
|
•
|
Consumer Confidence Index is an indicator designed to measure the degree of optimism that consumers feel about the overall state of the economy and their personal financial situation. How confident people are about stability of their incomes determines their spending activity and therefore serves as one of the key indicators for the overall shape of the economy. If consumer confidence is higher, consumers are making more purchases, boosting the economic expansion. On the other hand,
|
if confidence is lower, consumers tend to save more than they spend, prompting the contraction of the economy.
|
|
•
|
Industrial Production Index is an indicator designed to measure the output of businesses integrated in industrial sector of the economy such as manufacturing, mining, and utilities (electricity, gas and water) but excluding construction.
|
•
|
An investment cannot be made directly in an index.
|
•
|
Basis point (bps) is one hundredth of a percentage point (0.01%).
|
•
|
The net asset value per share (NAV) is calculated as the total market value of all the securities and other assets held by a fund minus total liabilities divided by the total number of common shares outstanding. The NAV of an investment company will fluctuate due to changes in the market prices of the underlying securities.
|
•
|
The market price of the common share of a closed-end fund is determined in the open market by buyers and sellers, and is the price at which investors may purchase or sell the common shares of a closed-end fund, which fluctuates throughout the day. Market price of common share may differ from the Fund’s Net Asset Value; shares of a closed-end fund may trade at a premium to (higher than) or a discount to (lower than) NAV. The difference between the market price and NAV is expressed as a percentage that is either a discount or a premium to NAV.
|
•
|
Alpha stocks is an equity class as classified by PAM based on the following criteria:. High Total Return. Dividend + share repurchase + capital increase.
|
•
|
Beta stocks is an equity class as classified by PAM based on the following criteria: Infrastructure related with internal free cash flow.
|
•
|
Special Situation stocks is an equity class as classified by PAM based on the following criteria: Value-oversold stocks. Below its intrinsic value as determined by PAM. Less than 1 times book value.
|
•
|
P/E: Price to Earnings Ratio. A valuation ratio of a company’s current share market price divided by its last 12 months earnings per shares compare to its per-share earnings.
|
•
|
EV/EBITDA: Enterprise value to EBIIDA (earnings before interest and amortization) is a valuation multiple used in finance and investment to measure the value of a company. It is the most widely used valuation multiple based on enterprise value.
|
•
|
Free Cash Flow: A measure of financial performance calculated as operating cash flow minus capital expenditures. Free cash flow (FCF) represents the cash that a company is able to generate after laying out the money required to maintain or expand its asset base.
|
•
|
REIT: Real estate investment trusts, a security that trades on the major exchanges and invests in real estate directly, either through properties or mortgages. REITs receive special tax considerations and typically offer investors high yields, as well as a highly liquid method of investing in real estate.
|
•
|
GLA: Gross Leasable Area, the total area available for lease.
|
•
|
References to other funds should not be considered a recommendation to buy or sell any security.
|
Real Activity (million US$)
|
2012
|
2011
|
2010
|
2009
|
2008
|
|||||||||||||||
Real GDP Growth (y-o-y)
|
3.90 | % | 3.90 | % | 5.50 | % | -6.50 | % | 1.30 | % | ||||||||||
Industrial Production (y-o-y Average)
|
3.90 | % | 3.80 | % | 6.06 | % | 7.29 | % | -0.04 | % | ||||||||||
Trade Balance (US billions)
|
$ | 0.20 | $ | -1.17 | $ | -3.12 | $ | -4.70 | $ | 15.53 | ||||||||||
Exports
|
$ | 370.90 | $ | 349.68 | $ | 298.36 | $ | 229.70 | $ | 291.81 | ||||||||||
Export growth (y-o-y)
|
6.20 | % | 17.20 | % | 28.20 | % | -18.10 | % | 7.30 | % | ||||||||||
Imports
|
$ | 370.80 | $ | 350.84 | $ | 301.48 | $ | 234.40 | $ | 308.65 | ||||||||||
Import growth (y-o-y)
|
5.70 | % | 16.40 | % | 25.00 | % | -19.90 | % | 9.50 | % | ||||||||||
Financial Variables and Prices
|
||||||||||||||||||||
28-Day CETES (T-bills) Average
|
4.29 | % | 4.81 | % | 4.40 | % | 4.51 | % | 7.97 | % | ||||||||||
Exchange rate (Pesos/US$) Average
|
13.15 | 12.60 | 12.63 | 13.50 | 11.16 | |||||||||||||||
Inflation IPC, 12 month trailing
|
3.60 | % | 3.82 | % | 4.40 | % | 3.57 | % | 6.53 | % | ||||||||||
Mexbol Index
|
||||||||||||||||||||
USD Return
|
28.97 | % | -13.46 | % | 28.79 | % | 55.34 | % | -40.48 | % | ||||||||||
Market Cap- (US billions)
|
$ | 372.29 | $ | 300.00 | $ | 281.56 | $ | 257.88 | $ | 172.14 | ||||||||||
EV/EBITDA
|
9.21 | x | 9.0 | x | 9.48 | x | 7.86 | x | 7.4 | x | ||||||||||
Fund’s NAV & Common Share
|
||||||||||||||||||||
Market Price Performance
|
||||||||||||||||||||
NAV’s per share
|
47.13 | % | -13.81 | % | 41.91 | % | 40.12 | % | -52.89 | % | ||||||||||
Share Price
|
45.13 | % | -12.18 | % | 48.41 | % | 22.20 | % | -41.85 | % |
Allocation of Portfolio Assets
|
January 31, 2013
(Unaudited)
|
Schedule of Investments
|
January 31, 2013
(Unaudited)
|
MEXICO – 100.24%
|
Shares
|
Value
|
||||||
COMMON STOCKS – 88.74%
|
||||||||
Airports – 2.38%
|
||||||||
Grupo Aeroportuario del Centro Norte, S.A. de C.V.
|
750,000 | $ | 2,504,011 | |||||
Beverages – 4.37%
|
||||||||
Arca Continental S.A.B. de C.V.
|
269,053 | 2,051,765 | ||||||
Fomento Economico Mexicano, S.A.B. de C.V.
|
236,150 | 2,549,906 | ||||||
4,601,671 | ||||||||
Building Materials – 3.54%
|
||||||||
Cemex, S.A.B. de C.V. (a)
|
3,408,556 | 3,718,298 | ||||||
Cable & Satellite – 3.83%
|
||||||||
Megacable Holdings S.A.B. de C.V.
|
1,528,014 | 4,031,969 | ||||||
Chemical Products – 6.42%
|
||||||||
Mexichem, S.A.B. de C.V.
|
1,194,000 | 6,753,848 | ||||||
Construction and Infrastructure – 5.50%
|
||||||||
Empresas ICA Sociedad Conroladora, S.A.B. de C.V. (a)
|
615,000 | 1,842,398 | ||||||
Impulsora del Desarrollo y el Empleo en America Latina, S.A.B. de C.V. (a)
|
978,455 | 2,127,812 | ||||||
Promotora y Operadora de Infraestructura, S.A.B. de C.V. (a)
|
253,426 | 1,813,603 | ||||||
5,783,813 | ||||||||
Consumer Products – 1.14%
|
||||||||
Kimberly-Clark de Mexico S.A.B. de C.V.
|
430,000 | 1,203,632 | ||||||
Financial Groups – 8.18%
|
||||||||
Banregio Grupo Financiero S.A.B. de C.V.
|
649,481 | 3,066,423 | ||||||
Grupo Financiero Banorte, S.A.B. de C.V. – Class O
|
430,850 | 2,970,807 | ||||||
Grupo Financiero Santander Mexico S.A.B. de C.V.
|
831,900 | 2,568,731 | ||||||
8,605,961 | ||||||||
Food Manufacturing – 1.37%
|
||||||||
Gruma, S.A.B. de C.V. (a)
|
431,000 | 1,439,311 | ||||||
Health Care – 0.97%
|
||||||||
Genomma Lab Internacional S.A.B. de C.V. (a)
|
448,550 | 1,024,130 |
Schedule of Investments (continued)
|
January 31, 2013
(Unaudited)
|
COMMON STOCKS (continued)
|
Shares
|
Value
|
||||||
Holding Companies – 11.86%
|
||||||||
Alfa, S.A.B. de C.V. – Class A
|
2,557,190 | $ | 6,140,265 | |||||
Grupo Carso, S.A.B. de C.V.
|
1,093,580 | 5,309,384 | ||||||
Grupo KUO S.A.B. de C.V. – Series B
|
389,660 | 1,025,131 | ||||||
12,474,780 | ||||||||
Hotels, Restaurants, and Recreation – 6.57%
|
||||||||
Alsea, S.A.B. de C.V. – Class A (a)
|
1,794,511 | 4,160,743 | ||||||
Grupe, S.A.B. de C.V. (a)
|
2,328,277 | 2,746,776 | ||||||
6,907,519 | ||||||||
Insurance Services – 4.32%
|
||||||||
Qualitias Controladora S.A.B. de C.V. (a)
|
2,577,947 | 4,541,709 | ||||||
Media – 1.93%
|
||||||||
Grupo Televisa, S.A.B. de C.V.
|
362,800 | 2,032,771 | ||||||
Mining – 6.26%
|
||||||||
Grupo Mexico, S.A.B. de C.V. – Series B
|
1,767,800 | 6,587,574 | ||||||
Real Estate Services – 2.31%
|
||||||||
Corporacion Inmobiliaria Vesta S.A.B. de C.V. (a)
|
1,258,496 | 2,433,928 | ||||||
Retail – 9.03%
|
||||||||
Corporativo Fragua S.A.B. de C.V.
|
101,290 | 1,688,884 | ||||||
El Puerto de Liverpool S.A.B. de C.V.
|
512,438 | 5,679,112 | ||||||
Wal-Mart de Mexico, S.A.B. de C.V. – Class V
|
656,338 | 2,127,810 | ||||||
9,495,806 | ||||||||
Rubber and Plastic Manufacturing – 2.18%
|
||||||||
Grupo Pochteca S.A.B. de C.V. (a)
|
5,103,673 | 2,287,994 | ||||||
Telecommunication Services – 6.58%
|
||||||||
America Movil, S.A.B. de C.V. – Class L
|
5,512,598 | 6,924,023 | ||||||
TOTAL COMMON STOCKS (Cost $77,512,395)
|
93,352,748 |
Schedule of Investments (continued)
|
January 31, 2013
(Unaudited)
|
REAL ESTATE INVESTMENT TRUSTS – 4.92%
|
Shares
|
Value
|
||||||
Fibra Uno Administracion S.A. de C.V.
|
759,147 | $ | 2,378,716 | |||||
Mexico Real Estate Management S.A. de C.V. (a)
|
1,194,000 | 2,794,696 | ||||||
TOTAL REAL ESTATE INVESTMENT TRUSTS (Cost $4,063,303)
|
5,173,412 | |||||||
CAPITAL DEVELOPMENT CERTIFICATES – 2.00%
|
||||||||
Atlas Discovery Trust II (b)
|
300,000 | 2,102,843 | ||||||
TOTAL CAPITAL DEVELOPMENT CERTIFICATES (Cost $2,317,515)
|
2,102,843 | |||||||
CORPORATE BONDS – 2.55%
|
||||||||
America Movil, S.A.B. de C.V. – Class L
|
||||||||
6.450%, 12/05/2022
|
2,600 | 2,151,066 | ||||||
Mexichem, S.A.B. de C.V.
|
||||||||
4.875%, 09/19/2022
|
500,000 | 526,875 | ||||||
TOTAL CORPORATE BONDS (Cost $2,640,489)
|
2,677,941 | |||||||
MEXICAN GOVERNMENT NOTES/BONDS – 1.05%
|
||||||||
Mexican Government International Bond
|
||||||||
4.750%, 03/08/2044
|
1,048,000 | 1,101,972 | ||||||
TOTAL MEXICAN GOVERNMENT NOTES/BONDS (Cost $1,118,503)
|
1,101,972 | |||||||
RIGHTS – 0.00%
|
||||||||
Grupo Pochteca S.A.B. de C.V. (a)
|
242,004 | 0 | ||||||
TOTAL RIGHTS (Cost $0)
|
0 | |||||||
SHORT-TERM INVESTMENTS – 0.98%
|
||||||||
Mexican INAFIN
|
||||||||
0.000% Coupon, 4.646% Effective Yield, 02/05/13 (c)
|
13,087,763 | * | 1,028,837 | |||||
TOTAL SHORT-TERM INVESTMENTS (Cost $1,027,592)
|
1,028,837 | |||||||
TOTAL MEXICO (Cost $88,679,797)
|
105,437,753 |
Schedule of Investments (concluded)
|
January 31, 2013
(Unaudited)
|
UNITED STATES – 0.30%
|
Shares
|
Value
|
||||||
INVESTMENT COMPANIES – 0.30%
|
||||||||
First American Treasury Obligation – Class A
|
312,171 | $ | 312,171 | |||||
TOTAL INVESTMENT COMPANIES (Cost $312,171)
|
312,171 | |||||||
TOTAL UNITED STATES (Cost $312,171)
|
312,171 | |||||||
TOTAL INVESTMENTS (Cost $88,991,968) – 100.54%
|
105,749,924 | |||||||
LIABILITIES IN EXCESS OF OTHER ASSETS – (0.54)%
|
(563,861 | ) | ||||||
TOTAL NET ASSETS – 100.00%
|
$ | 105,186,063 |
(a)
|
Non-income producing security.
|
(b)
|
The Advisor has determined these securities to be illiquid. The total value of illiquid securities at January 31, 2013 was $2,102,843 comprising 2.00% of net assets, while the remainder of the Fund’s net assets 98.00% were liquid.
|
(c)
|
Effective Yield based on the purchase price. The calculation assumes the security is held to maturity.
|
*
|
Principal amount in Mexican Pesos.
|
Statement of Assets & Liabilities
|
January 31, 2013
(Unaudited)
|
ASSETS:
|
||||
Investments, at value (cost $88,991,968)
|
$ | 105,749,924 | ||
Receivables for investments sold
|
2,041,637 | |||
Dividends and interest receivable
|
67,003 | |||
Other assets
|
17,903 | |||
Total Assets
|
107,876,467 | |||
LIABILITIES:
|
||||
Payable for securities purchased
|
2,476,628 | |||
Advisory fees payable
|
99,374 | |||
Administration fees payable
|
21,314 | |||
Payable to Custodian
|
18,817 | |||
NYSE fees payable
|
17,616 | |||
Audit fees payable
|
15,778 | |||
Fund accounting fees payable
|
10,035 | |||
Director fees payable
|
8,655 | |||
Custody fees payable
|
8,467 | |||
Transfer Agent fees and expenses payable
|
8,365 | |||
CCO fees payable
|
2,439 | |||
Accrued expenses and other liabilities
|
2,916 | |||
Total Liabilities
|
2,690,404 | |||
Net Assets
|
$ | 105,186,063 | ||
Net Asset Value Per Preferred Share ($985,433 / 57,639)
|
$ | 17.10 | ||
Net Asset Value Per Common Share ($104,200,630 / 6,094,804)
|
$ | 17.10 | ||
NET ASSETS CONSIST OF:
|
||||
Preferred stock, $0.001 par value; 57,639 shares outstanding
|
||||
(1,855,128 shares authorized)
|
$ | 58 | ||
Common stock, $0.001 par value; 6,094,804 shares outstanding
|
||||
(98,144,872 shares authorized)
|
6,095 | |||
Paid-in capital
|
80,871,602 | |||
Accumulated net investment loss
|
(452,677 | ) | ||
Accumulated net realized gain on investments and foreign currency
|
8,006,784 | |||
Net unrealized appreciation on investments and foreign currency
|
16,754,201 | |||
Net Assets
|
$ | 105,186,063 |
Statement of Operations
|
For the Six Months Ended
January 31, 2013 (Unaudited)
|
INVESTMENT INCOME
|
||||
Dividends(1)
|
$ | 316,843 | ||
Interest(2)
|
79,482 | |||
Total Investment Income
|
396,325 | |||
EXPENSES
|
||||
Advisory fees (Note B)
|
409,724 | |||
Directors’ fees and expenses (Note B)
|
65,935 | |||
Administration fees (Note B)
|
57,716 | |||
Custodian fees (Note B)
|
28,598 | |||
Fund accounting fees (Note B)
|
24,458 | |||
Legal fees
|
23,207 | |||
CCO fees and expenses (Note B)
|
19,852 | |||
Audit fees
|
15,637 | |||
NYSE fees
|
14,520 | |||
Printing and mailing
|
14,146 | |||
Insurance expense
|
13,411 | |||
Transfer agent fees and expenses (Note B)
|
10,969 | |||
Miscellaneous
|
520 | |||
Total expenses
|
698,693 | |||
NET INVESTMENT LOSS
|
(302,368 | ) | ||
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
|
||||
Net realized gain from investments and foreign currency transactions
|
10,588,532 | |||
Net change in unrealized appreciation on investments and foreign currency transactions
|
10,976,563 | |||
Net gain from investments and foreign currency transactions
|
21,565,095 | |||
Net increase in net assets resulting from operations
|
$ | 21,262,727 |
(1)
|
Net of $25,500 in dividend withholding tax.
|
|
(2)
|
Net of $1,603 In interest withholding tax.
|
For the Six
|
||||||||
Months Ended
|
For the
|
|||||||
January 31, 2013
|
Year Ended
|
|||||||
(Unaudited)
|
July 31, 2012
|
|||||||
INCREASE (DECREASE) IN NET ASSETS
|
||||||||
Operations:
|
||||||||
Net investment loss
|
$ | (302,368 | ) | $ | (341,110 | ) | ||
Net realized gain on investments and foreign currency transactions
|
10,588,532 | 3,526,903 | ||||||
Net change in unrealized appreciation (depreciation) in value
|
||||||||
of investments and foreign currency transactions
|
10,976,563 | (703,551 | ) | |||||
Net increase in net assets resulting from operations
|
21,262,727 | 2,482,242 | ||||||
Distributions to Shareholders from:
|
||||||||
Net realized gains
|
||||||||
Common stock
|
(1,158,013 | ) | — | |||||
Preferred stock
|
(10,951 | ) | — | |||||
Decrease in net assets from distributions
|
(1,168,964 | ) | — | |||||
Capital Share Transactions
|
||||||||
Repurchase of common stock (Note D)
|
(2,671,807 | ) | (4,666,313 | ) | ||||
Decrease in net assets from capital share transactions
|
(2,671,807 | ) | (4,666,313 | ) | ||||
Total increase/(decrease) in net assets
|
17,421,956 | (2,184,071 | ) | |||||
Net Assets:
|
||||||||
Beginning of period
|
87,764,107 | 89,948,178 | ||||||
End of period*
|
$ | 105,186,063 | $ | 87,764,107 | ||||
* Including accumulated net investment loss of
|
$ | (452,677 | ) | $ | (150,309 |
For the Six
|
||||||||||||||||||||||||
Months Ended
|
||||||||||||||||||||||||
January 31,
|
For the Year Ended July 31,
|
|||||||||||||||||||||||
2013
|
||||||||||||||||||||||||
(Unaudited)
|
2012
|
2011
|
2010
|
2009
|
2008
|
|||||||||||||||||||
Per Share Operating Performance
|
||||||||||||||||||||||||
Net asset value, beginning of period
|
$ | 13.78 | $ | 13.26 | $ | 10.48 | $ | 7.37 | $ | 28.29 | $ | 38.18 | ||||||||||||
Net investment income (loss)
|
(0.05 | ) | (0.05 | ) | (0.03 | ) | (0.01 | ) | 0.07 | 0.03 | ||||||||||||||
Net realized and unrealized
|
||||||||||||||||||||||||
gains (losses) on investments
|
||||||||||||||||||||||||
and foreign currency transactions
|
3.50 | 0.48 | 2.75 | 3.00 | (13.95 | ) | (2.57 | ) | ||||||||||||||||
Net increase (decrease)
|
||||||||||||||||||||||||
from investment operations
|
3.45 | 0.43 | 2.72 | 2.99 | (13.88 | ) | (2.54 | ) | ||||||||||||||||
Less: Distributions
|
||||||||||||||||||||||||
Dividends from net investment income
|
— | — | (0.02 | ) | — | (0.25 | ) | — | ||||||||||||||||
Distributions from net realized gains
|
(0.19 | ) | — | — | — | (6.52 | ) | (7.41 | ) | |||||||||||||||
Total dividends and distributions
|
(0.19 | ) | — | (0.02 | ) | — | (6.77 | ) | (7.41 | ) | ||||||||||||||
Capital Share Transactions
|
||||||||||||||||||||||||
Anti-dilutive effect of Common
|
||||||||||||||||||||||||
Share Repurchase Program
|
0.06 | 0.09 | 0.08 | 0.12 | 0.04 | 0.15 | ||||||||||||||||||
Anti-dilutive effect of Common
|
||||||||||||||||||||||||
Rights Offering
|
— | — | — | — | — | 0.06 | ||||||||||||||||||
Anti-dilutive effect of Preferred
|
||||||||||||||||||||||||
In-Kind Tender Offer
|
— | — | — | — | — | 0.02 | ||||||||||||||||||
Dilutive effect of Preferred
|
||||||||||||||||||||||||
In-Kind Tender Offer
|
— | — | — | (0.00 | )(3) | (0.02 | ) | — | ||||||||||||||||
Dilutive effect of Reinvestment of
|
||||||||||||||||||||||||
Distributions by Common Stockholders
|
— | — | — | — | (0.29 | ) | (0.17 | ) | ||||||||||||||||
Total capital share transactions
|
0.06 | 0.09 | 0.08 | 0.12 | (0.27 | ) | 0.06 | |||||||||||||||||
Net Asset Value, end of period
|
$ | 17.10 | $ | 13.78 | $ | 13.26 | $ | 10.48 | $ | 7.37 | $ | 28.29 | ||||||||||||
Per share market value, end of period
|
$ | 15.75 | $ | 12.11 | $ | 11.64 | $ | 9.25 | $ | 6.08 | $ | 24.39 | ||||||||||||
Total Investment Return Based on
|
||||||||||||||||||||||||
Market Value, end of period(1)
|
31.79 | % | 4.04 | % | 26.09 | % | 52.14 | % | (43.10 | )% | (28.38 | )% |
For the Six
|
||||||||||||||||||||||||
Months Ended
|
||||||||||||||||||||||||
January 31,
|
For the Year Ended July 31,
|
|||||||||||||||||||||||
2013
|
||||||||||||||||||||||||
(Unaudited)
|
2012
|
2011
|
2010
|
2009
|
2008
|
|||||||||||||||||||
Ratios/Supplemental Data
|
||||||||||||||||||||||||
Net assets, end of period (000’s)
|
$ | 104,201 | $ | 86,970 | $ | 89,184 | $ | 74,609 | $ | 56,980 | $ | 106,484 | ||||||||||||
Ratios of expenses to average net assets
|
1.47 | % | 1.57 | % | 1.51 | % | 1.68 | % | 1.82 | % | 1.50 | % | ||||||||||||
Ratios of net investment income (loss)
|
||||||||||||||||||||||||
to average net assets
|
(0.64 | )% | (0.42 | )% | (0.20 | )% | (0.02 | )% | 0.97 | % | 0.09 | % | ||||||||||||
Portfolio turnover rate(2)
|
91.70 | % | 277.48 | %(2) | 253.20 | %(2) | 365.58 | %(2) | 335.64 | %(2) | 224.10 | % |
(1)
|
Total investment return is calculated assuming a purchase of common stock at the current market price on the first day and a sale at the current market price on the last day of each year reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the Fund’s dividend reinvestment plan. Total investment does not reflect brokerage commissions.
|
|
(2)
|
Calculated on the basis of the Fund as a whole without distinguishing between shares issued.
|
|
(3)
|
Less than 0.5 cent per share.
|
For the Six
|
||||||||||||||||||||||||
Months Ended
|
||||||||||||||||||||||||
January 31,
|
For the Year Ended July 31,
|
|||||||||||||||||||||||
2013
|
||||||||||||||||||||||||
(Unaudited)
|
2012
|
2011
|
2010
|
2009
|
2008
|
|||||||||||||||||||
Per Share Operating Performance
|
||||||||||||||||||||||||
Net asset value, beginning of period
|
$ | 13.78 | $ | 13.26 | $ | 10.48 | $ | 7.37 | $ | 28.29 | $ | 38.18 | ||||||||||||
Net investment income
|
(0.05 | ) | (0.05 | ) | (0.03 | ) | (0.01 | ) | 0.07 | 0.03 | ||||||||||||||
Net realized and unrealized
|
||||||||||||||||||||||||
gains (losses) on investments
|
||||||||||||||||||||||||
and foreign currency transactions
|
3.50 | 0.48 | 2.75 | 3.00 | (13.95 | ) | (2.57 | ) | ||||||||||||||||
Net increase (decrease)
|
||||||||||||||||||||||||
from investment operations
|
3.45 | 0.43 | 2.72 | 2.99 | (13.88 | ) | (2.54 | ) | ||||||||||||||||
Less: Distributions
|
||||||||||||||||||||||||
Dividends from net investment income
|
— | — | (0.02 | ) | — | (0.25 | ) | — | ||||||||||||||||
Distributions from net realized gains
|
(0.19 | ) | — | — | — | (6.52 | ) | (7.41 | ) | |||||||||||||||
Total dividends and distributions
|
(0.19 | ) | — | (0.02 | ) | — | (6.77 | ) | (7.41 | ) | ||||||||||||||
Capital Share Transactions
|
||||||||||||||||||||||||
Anti-dilutive effect of Common
|
||||||||||||||||||||||||
Share Repurchase Program
|
0.06 | 0.09 | 0.08 | 0.12 | 0.04 | 0.15 | ||||||||||||||||||
Anti-dilutive effect of Common
|
||||||||||||||||||||||||
Rights Offering
|
— | — | — | — | — | 0.06 | ||||||||||||||||||
Anti-dilutive effect of Preferred
|
||||||||||||||||||||||||
In-Kind Tender Offer
|
— | — | — | — | — | 0.02 | ||||||||||||||||||
Dilutive effect of Preferred
|
||||||||||||||||||||||||
In-Kind Tender Offer
|
— | — | — | (0.00 | )(3) | (0.02 | ) | — | ||||||||||||||||
Dilutive effect of Reinvestment of
|
||||||||||||||||||||||||
Distributions by Common Stockholders
|
— | — | — | — | (0.29 | ) | (0.17 | ) | ||||||||||||||||
Total capital share transactions
|
0.06 | 0.09 | 0.08 | 0.12 | (0.27 | ) | 0.06 | |||||||||||||||||
Net Asset Value, end of period
|
$ | 17.10 | $ | 13.78 | $ | 13.26 | $ | 10.48 | $ | 7.37 | $ | 28.29 | ||||||||||||
Per share market value, end of period
|
$ | 15.01 | * | $ | 16.03 | * | $ | 11.93 | * | $ | 9.17 | * | $ | 6.85 | $ | 25.50 | ||||||||
Total Investment Return Based on
|
||||||||||||||||||||||||
Market Value, end of period(1)
|
(5.11 | )%* | 34.37 | %* | 30.36 | %* | 33.87 | %* | (38.67 | )% | (8.25 | )% |
For the Six
|
||||||||||||||||||||||||
Months Ended
|
||||||||||||||||||||||||
January 31,
|
For the Year Ended July 31,
|
|||||||||||||||||||||||
2013
|
||||||||||||||||||||||||
(Unaudited)
|
2012
|
2011
|
2010
|
2009
|
2008
|
|||||||||||||||||||
Ratios/Supplemental Data
|
||||||||||||||||||||||||
Net assets, end of period (000’s)
|
$ | 985 | $ | 794 | $ | 764 | $ | 739 | $ | 4,444 | $ | 22,742 | ||||||||||||
Ratios of expenses to average net assets
|
1.47 | % | 1.57 | % | 1.51 | % | 1.68 | % | 1.82 | % | 1.50 | % | ||||||||||||
Ratios of net investment income (loss)
|
||||||||||||||||||||||||
to average net assets
|
(0.64 | )% | (0.42 | )% | (0.20 | )% | (0.02 | )% | 0.97 | % | 0.09 | % | ||||||||||||
Portfolio turnover rate(2)
|
91.70 | % | 277.48 | %(2) | 253.20 | %(2) | 365.58 | %(2) | 335.64 | %(2) | 224.10 | % |
(1)
|
Total investment return is calculated assuming a purchase of preferred stock at the current market price on the first day and a sale at the current market price on the last day of each year reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the Fund’s dividend reinvestment plan. Total investment does not reflect brokerage commissions.
|
|
(2)
|
Calculated on the basis of the Fund as a whole without distinguishing between shares issued.
|
|
(3)
|
Less than 0.5 cent per share.
|
|
*
|
Based on the mean of the bid and ask.
|
Notes to Financial Statements
|
January 31, 2013
(Unaudited)
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Dividends distributed by Mexican companies are subject to withholding tax at an effective rate of 0.00%.
|
|
Interest income on debt issued by the Mexican federal government is generally not subject to withholding. Withholding tax on interest from other debt obligations such as publicly traded bonds and loans by banks or insurance companies is at a rate of 4.9% under the tax treaty between Mexico and the United States.
|
|
Gains realized from the sale or disposition of debt securities may be subject to a 4.9% withholding tax. Gains realized by the Fund from the sale or disposition of equity securities that are listed and traded on the Mexican Stock Exchange (“MSE”) are exempt from Mexican withholding tax if sold through the stock exchange. Gains realized on transactions outside of the MSE may be subject to withholding at a rate of 25% (20% rate prior to January 1, 2002) of the value of the shares sold or, upon the election of the Fund, at 35% (40% rate prior to January 1, 2002) of the gain. If the Fund has owned less than 25% of the outstanding stock of the issuer of the equity securities within the 12 month period preceding the disposition, then such disposition will not be subject to capital gains taxes as provided for in the treaty to avoid double taxation between Mexico and the United States.
|
Level 1 –
|
Unadjusted quoted prices in active markets for identical assets or liabilities that the company has the ability to access.
|
|
Level 2 –
|
Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
|
|
Level 3 –
|
Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the company’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Level 1*
|
Level 2*
|
Level 3
|
Total
|
|||||||||||||
Equity
|
||||||||||||||||
Airports
|
$ | 2,504,011 | $ | — | $ | — | $ | 2,504,011 | ||||||||
Beverages
|
4,601,671 | — | — | 4,601,671 | ||||||||||||
Building Materials
|
3,718,298 | — | — | 3,718,298 | ||||||||||||
Cable & Satellite
|
4,031,969 | — | — | 4,031,969 | ||||||||||||
Capital Development Certificates
|
— | — | 2,102,843 | 2,102,843 | ||||||||||||
Chemical Products
|
6,753,848 | — | — | 6,753,848 | ||||||||||||
Construction and Infrastructure
|
5,783,813 | — | — | 5,783,813 | ||||||||||||
Consumer Products
|
1,203,632 | — | — | 1,203,632 | ||||||||||||
Financial Groups
|
8,605,961 | — | — | 8,605,961 | ||||||||||||
Food Manufacturing
|
1,439,311 | — | — | 1,439,311 | ||||||||||||
Health Care
|
1,024,130 | — | — | 1,024,130 | ||||||||||||
Holding Companies
|
12,474,780 | — | — | 12,474,780 | ||||||||||||
Hotels, Restaurants, and Recreation
|
4,160,743 | 2,746,776 | — | 6,907,519 | ||||||||||||
Insurance Services
|
4,541,709 | — | — | 4,541,709 | ||||||||||||
Media
|
2,032,771 | — | — | 2,032,771 | ||||||||||||
Mining
|
6,587,574 | — | — | 6,587,574 | ||||||||||||
Real Estate Services
|
2,433,928 | — | — | 2,433,928 | ||||||||||||
Retail
|
9,495,806 | — | — | 9,495,806 | ||||||||||||
Rubber and Plastic Manufacturing
|
2,287,994 | — | — | 2,287,994 | ||||||||||||
Telecommunication Services
|
6,924,023 | — | — | 6,924,023 | ||||||||||||
Total Equity
|
90,605,972 | 2,746,776 | 2,102,843 | 95,455,591 | ||||||||||||
Real Estate Investment Trusts
|
$ | 5,173,412 | $ | — | $ | — | $ | 5,173,412 | ||||||||
Corporate Bonds
|
$ | — | $ | 2,677,941 | $ | — | $ | 2,677,941 | ||||||||
Mexican Government Note/Bonds
|
$ | — | $ | 1,101,972 | $ | — | $ | 1,101,972 | ||||||||
Rights
|
$ | — | $ | — | $ | — | $ | — | ||||||||
Short-Term Investments
|
$ | 312,171 | $ | 1,028,837 | $ | — | $ | 1,341,008 | ||||||||
Total Investment in Securities
|
$ | 96,091,555 | $ | 7,555,526 | $ | 2,102,843 | $ | 105,749,924 |
*
|
There were no significant transfers between levels 1 and 2 during the period. Transfers between levels are recognized at the end of the reporting period.
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Description
|
Investments in Securities
|
Balance as of July 31, 2012
|
$ | 1,914,447 | |||
Acquisition/Purchase
|
— | ||||
Sales
|
— | ||||
Realized gain
|
— | ||||
Change in unrealized appreciation (depreciation)(1)
|
(188,396 | ) | |||
Balance as of January 31, 2013
|
$ | 2,102,843 |
(1)
|
Included in the net change of unrealized appreciation (depreciation) on investments in the Statement of Operations.
|
Impact to
|
||||
Valuation from
|
||||
Fair Value
|
Valuation
|
Unobservable
|
an increase in
|
|
January 31, 2013
|
Methodologies
|
Input(1)
|
Input(2)
|
|
Capital Development Certificates
|
$2,102,843
|
Market
|
Sum of the Parts
|
Increase
|
Comparables/
|
Valuation
|
|||
Sum of the Parts
|
||||
Valuation
|
(1)
|
In determining certain of these inputs, management evaluates a variety of factors including economic conditions, foreign exchange rates, industry and market developments, market valuations of comparable companies and company specific developments.
|
|
(2)
|
This column represents the directional change in the fair value of the Level 3 investments that would result from an increase to the corresponding unobservable input. A decrease to the unobservable input would have the opposite effect.
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
(i)
|
market value of investment securities, assets and liabilities at the current Mexican peso exchange rate on the valuation date, and
|
||
(ii)
|
purchases and sales of investment securities, income and expenses at the Mexican peso exchange rate prevailing on the respective dates of such transactions. Fluctuations in foreign currency rates, however, when determining the gain or loss upon the sale of foreign currency denominated debt obligations pursuant to U.S. Federal income tax regulations; such amounts are categorized as foreign exchange gain or loss for income tax reporting purposes.
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Distributions paid from:
|
7/31/12
|
7/31/11
|
||||||
Ordinary Income
|
$ | — | $ | 161,853 | ||||
Long-Term Capital Gain
|
— | — | ||||||
Total
|
$ | — | $ | 161,853 |
Cost of Investments for tax purposes(a)
|
$ | 81,732,426 | |||
Gross tax unrealized appreciation on investments
|
6,603,950 | ||||
Gross tax unrealized depreciation on investments
|
(2,239,096 | ) | |||
Net tax unrealized appreciation (depreciation) on investments
|
4,364,854 | ||||
Net tax unrealized appreciation (depreciation) on
|
|||||
investments
|
$ | 4,364,854 | |||
Other accumulated gains(losses)
|
$ | (150,309 | ) | ||
Total accumulated earnings(losses)
|
$ | 4,214,545 |
(a)
|
Represents cost for federal income tax purposes. Differences between the Fund’s cost basis of investments at July 31, 2012, for book and tax purposes, relates primarily to the deferral of losses related to wash sales.
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Notes to Financial Statements (continued)
|
January 31, 2013
(Unaudited)
|
Additional Information
|
January 31, 2013
(Unaudited)
|
Additional Information (concluded)
|
January 31, 2013
(Unaudited)
|
Dividends and Distributions
|
January 31, 2013
(Unaudited)
|
Dividends and Distributions (concluded)
|
January 31, 2013
(Unaudited)
|
Stockholders Meeting
|
January 31, 2013
(Unaudited)
|
I. (A)
|
Election of Directors – Common and Preferred
|
||
Votes For
|
Votes Against
|
||
Andrew Dakos
|
3,326,776
|
2,219,156
|
|
I. (B)
|
Election of Directors – Preferred
|
||
Votes For
|
Votes Against
|
||
Rajeev Das
|
31,965
|
21,358
|
Privacy Policy
|
January 31, 2013
(Unaudited)
|
FACTS
|
WHAT DOES THE MEXICO EQUITY AND INCOME FUND, INC. (THE “FUND”),
|
|||
AND SERVICE PROVIDERS TO THE FUND, ON THE FUND’S BEHALF, DO WITH YOUR PERSONAL INFORMATION?
|
||||
Why?
|
Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
|
|||
What?
|
The types of personal information we, and our service providers, on our behalf, collect and share depends on the product or service you have with us. This information can include:
|
|||
• Social Security number
|
||||
• account balances
|
||||
• account transactions
|
||||
• transaction history
|
||||
• wire transfer instructions
|
||||
• checking account information
|
||||
When you are no longer our customer, we continue to share your information as described in this notice.
|
||||
How?
|
All financial companies need to share customers' personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reasons the Fund, and our service providers, on our behalf, choose to share; and whether you can limit this sharing.
|
Reasons we can share your personal information
|
Does the Fund share?
|
Can you limit this sharing?
|
||
For our everyday business purposes –
|
||||
such as to process your transactions, maintain your account(s),
|
||||
respond to court orders and legal investigations, or report to
|
||||
credit bureaus
|
Yes
|
No
|
||
For our marketing purposes –
|
||||
to offer our products and services to you
|
No
|
We don’t share
|
||
For joint marketing with other financial companies
|
No
|
We don’t share
|
||
For our affiliates’ everyday business purposes –
|
||||
information about your transactions and experiences
|
Yes
|
No
|
||
For our affiliates’ everyday business purposes –
|
||||
information about your creditworthiness
|
No
|
We don’t share
|
||
For our affiliates to market to you
|
No
|
We don’t share
|
||
For nonaffiliates to market to you
|
No
|
We don’t share
|
Questions?
|
Call (877) 785-0376
|
Privacy Policy (concluded)
|
January 31, 2013
(Unaudited)
|
What we do
|
||||
Who is providing this notice?
|
The Mexico Equity and Income Fund, Inc. (the “Fund”)
|
|||
How does the Fund, and the
|
To protect your personal information from unauthorized access and use,
|
|||
Fund’s service providers, on the
|
we and our service providers use security measures that comply with
|
|||
Fund’s behalf, protect my
|
federal law. These measures include computer safeguards and secured
|
|||
personal information?
|
files and buildings.
|
|||
How does the Fund, and the
|
We collect your personal information, for example, when you:
|
|||
Fund’s service providers, on
|
• open an account
|
|||
the Fund’s behalf, collect my
|
• provide account information
|
|||
personal information?
|
• give us your contact information
|
|||
• make a wire transfer
|
||||
We also collect your information from others, such as credit bureaus, affiliates, or other companies.
|
||||
Why can’t I limit all sharing?
|
Federal law gives you the right to limit only
|
|||
• sharing for affiliates’ everyday business purposes – information about your creditworthiness
|
||||
• affiliates from using your information to market to you
|
||||
• sharing for nonaffiliates to market to you
|
||||
State laws and individual companies may give you additional rights to limit sharing.
|
||||
Definitions
|
||||
Affiliates
|
Companies related by common ownership or control. They can be financial and nonfinancial companies.
|
|||
• None
|
||||
Nonaffiliates
|
Companies not related by common ownership or control. They can be financial and nonfinancial companies.
|
|||
• The Fund does not share with nonaffiliates so they can market to you.
|
||||
Joint marketing
|
A formal agreement between nonaffiliated financial companies that together market financial products or services to you.
|
|||
• The Fund does not jointly market.
|
Management of the Fund
|
January 31, 2013
(Unaudited)
|
Term of
|
|||||
Year
|
Position(s)
|
Office/Length
|
Principal Occupation
|
Other Directorships
|
|
Name and Address
|
Born
|
with the Fund
|
of Time Served
|
During the Past Five Years
|
Held by Director
|
Gerald Hellerman
|
1937
|
Director, Chief
|
2010 / 11 years
|
Managing Director,
|
Director, AirNet
|
615 E. Michigan Street
|
Financial Officer
|
Hellerman Associates
|
Systems Inc.;
|
||
Milwaukee, WI 53202
|
and Chief
|
Director, Brantley
|
|||
Compliance
|
Capital Corporation;
|
||||
Officer
|
Director, Ironsides
|
||||
Partners Opportunity
|
|||||
Offshore Fund Ltd.;
|
|||||
Director, MVC
|
|||||
Capital, Inc.;
|
|||||
Director, Old Mutual
|
|||||
Absolute Return and
|
|||||
Emerging managers
|
|||||
Fund Complex
|
|||||
(consisting of six
|
|||||
funds); Director,
|
|||||
Special Opportunities
|
|||||
Fund Inc.; Director,
|
|||||
TM Entertainment
|
|||||
and Media, Inc.;
|
|||||
Director, Imperial
|
|||||
Holdings, Inc.
|
Management of the Fund (continued)
|
January 31, 2013
(Unaudited)
|
Term of
|
|||||
Year
|
Position(s)
|
Office/Length
|
Principal Occupation
|
Other Directorships
|
|
Name and Address
|
Born
|
with the Fund
|
of Time Served
|
During the Past Five Years
|
Held by Director
|
Phillip Goldstein
|
1945
|
Director
|
2011 / 12 years
|
Member of Bulldog
|
Director, ASA Ltd.;
|
Park 80 West, Plaza Two,
|
Holdings, LLC, the
|
Director, MVC
|
|||
250 Pehle Avenue,
|
owner of several entities
|
Capital Inc.; Director,
|
|||
Suite 708,
|
serving as the general
|
Imperial Holdings,
|
|||
Saddle Brook, NJ 07663
|
partner of several private
|
Inc.; Chairman,
|
|||
investment partnerships in
|
Special Opportunities
|
||||
the Bulldog Investors group
|
Fund, Inc.; Chairman,
|
||||
of funds, and the owner of
|
Brantley Capital
|
||||
Kimball & Winthrop, LLC,
|
Corporation;
|
||||
the managing general partner
|
Chairman, Special
|
||||
of Bulldog Investors
|
Opportunities
|
||||
General Partnership, since
|
Fund Inc.; Chairman,
|
||||
2012. From 1992-2012,
|
Brantley Capital
|
||||
Mr. Goldstein was a
|
Corporation;
|
||||
member of the general
|
Director, Korea
|
||||
partner of several private
|
Equity Fund, Inc.
|
||||
investment partnerships
|
|||||
in the Bulldog Investors
|
|||||
group of funds. Member
|
|||||
of the investment advisor to
|
|||||
the Special Opportunities
|
|||||
Fund, Inc. since 2009.
|
|||||
Glenn Goodstein
|
1963
|
Director
|
2010 / 11 years
|
Registered Investment
|
None
|
2308 Camino Robledo
|
Advisor; held numerous
|
||||
Carlsbad, CA 92009
|
executive positions with
|
||||
Automatic Data Processing
|
|||||
until 1996.
|
|||||
Rajeev Das
|
1968
|
Director
|
2009 / 11 years
|
Since 2004, Mr. Das has
|
None
|
68 Lafayette Avenue
|
been a Principal of the
|
||||
Dumont, NJ 07628
|
entities serving as the general
|
||||
partner of the private
|
|||||
investment partnerships in
|
|||||
the Bulldog Investors group
|
|||||
of investment funds. Head
|
|||||
Trader of the investment
|
|||||
advisor to the Special
|
|||||
Opportunities Fund, Inc.
|
|||||
since 2009. Treasurer of
|
|||||
Special Opportunities Fund,
|
|||||
Inc. since 2009.
|
Management of the Fund (concluded)
|
January 31, 2013
(Unaudited)
|
Term of
|
|||||
Year
|
Position(s)
|
Office/Length
|
Principal Occupation
|
Other Directorships
|
|
Name and Address
|
Born
|
with the Fund
|
of Time Served
|
During the Past Five Years
|
Held by Director
|
Andrew Dakos
|
1966
|
Director
|
2009 / 11 years
|
Member of Bulldog
|
Director, Special
|
Park 80 West, Plaza Two
|
Holdings, LLC, the owner
|
Opportunities
|
|||
250 Pehle Avenue,
|
of several entities serving
|
Fund Inc.; Director,
|
|||
Suite 708
|
as the general partner of
|
Brantley Capital
|
|||
Saddle Brook, NJ 07663
|
several private investment
|
Corporation;
|
|||
partnerships in the Bulldog
|
Director, Imperial
|
||||
Investors group of funds,
|
Holdings, Inc.
|
||||
and the owner of Kimball
|
|||||
& Winthrop, LLC, the
|
|||||
managing general partner
|
|||||
of Bulldog Investors General
|
|||||
Partnership, since 2012.
|
|||||
From 1992-2012, Mr. Dakos
|
|||||
was a member of the general
|
|||||
partner of several private
|
|||||
investment partnerships in
|
|||||
the Bulldog Investors group
|
|||||
of funds. Member of the
|
|||||
investment advisor to the
|
|||||
Special Opportunities Fund,
|
|||||
Inc. since 2009, and Chief
|
|||||
Compliance Officer of the
|
|||||
investment advisor to the
|
|||||
Special Opportunities Fund
|
|||||
from 2009-2012.
|
|||||
Maria Eugenia Pichardo
|
1950
|
Interested
|
2011 / 2 years
|
Portfolio Manager of the
|
None
|
Paseo de Tamarindos 45-201
|
Director,
|
Fund since the Fund’s
|
|||
Bosques de las Lomas
|
Officer,
|
Indefinite / 8 years
|
Inception; President and
|
||
Mexico DF 05120
|
President
|
General Partner, Pichardo
|
|||
Asset Management, S.A. de
|
|||||
C.V. since 2003; Managing
|
|||||
Director, Acciones y Valores
|
|||||
de Mexico, S.A. de C.V.
|
|||||
from 1979 to 2002.
|
|||||
Luis Calzada
|
1965
|
Secretary
|
Indefinite / 1 year
|
Administrative and
|
None
|
Paseo de Tamarindos 45-201
|
Compliance Director,
|
||||
Bosques de las Lomas
|
Pichardo Asset
|
||||
Mexico DF 05120
|
Management S.A. de C.V.
|
I.
|
CORPORATE GOVERNANCE
|
A.
|
Board and Governance Issues
|
1.
|
Board of Director/Trustee Composition
|
Portfolio Manager Name
|
Registered Investment
Company (dollar amount
and number of accounts)
|
Other Pooled Investments
(dollar amount and
number of accounts)
|
Other Accounts
(dollar amount and
number of accounts)
|
Ms. Maria Eugenia Pichardo
|
$105,203,162 (1)
|
$0 (0)
|
$3,000.000 (3)
|
Portfolio Manager Name
|
Dollar Range of Equity Securities in the Fund
(None, $1-$10,000, $10,001-$50,000,
$50,001-$100,000, $100,001 - $500,000,
$500,001 to $1,000,000, Over $1,000,000)
|
Aggregate Dollar Range of Securities in
all Registered Investment Companies
Overseen by Portfolio Manager in
Family of Investment Companies
|
Ms. Maria Eugenia Pichardo
|
None
|
None
|
Period
|
(a)
Total Number of Shares
(or Units) Purchased
|
(b)
Average Price Paid
per Share (or Unit)
|
(c)
Total Number of Shares
(or Units) Purchased as
Part of Publicly Announced Plans or Programs
|
(d)
Maximum Number
(or Approximate Dollar Value) of Shares (or Units) that
May Yet Be Purchased Under the Plans or Programs
|
8/1/12 to 8/31/12
|
13,607
|
12.24
|
||
9/1/12 to 9/30/12
|
61,362
|
12.26
|
||
10/1/12 to 10/31/12
|
6,736
|
13.36
|
||
11/1/12 to 11/30/12
|
133,413
|
12.46
|
||
12/1/12 to 12/31/12
|
0
|
0
|
||
1/1/13 to 1/31/13
|
0
|
0
|
||
Total
|
215,118 (1)
|
12.42
|
(a)
|
The Registrant’s President and Chief Financial Officer have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant’s service provider.
|
(b)
|
There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.
|
(a)
|
(1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Not applicable.
|
(b)
|
Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.
|
1.
|
I have reviewed this report on Form N-CSR of The Mexico Equity and Income Fund, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: March 19, 2013
|
/s/ Maria Eugenia Pichardo
Maria Eugenia Pichardo
President
|
1.
|
I have reviewed this report on Form N-CSR of The Mexico Equity and Income Fund, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: April 4, 2013
|
/s/ Gerald Hellerman
Gerald Hellerman
Chief Financial Officer
|
/s/ Maria Eugenia Pichardo
Maria Eugenia Pichardo
President
The Mexico Equity and Income Fund, Inc.
|
/s/ Gerald Hellerman
Gerald Hellerman
Chief Financial Officer
The Mexico Equity and Income Fund, Inc.
|
Dated: March 19, 2013
|
Dated: April 4, 2013
|
````N@$R``(````4
M````V(=I``0````!````[````1@`$D^````G$``23X```"<0061O8F4@4&AO
M=&]S:&]P($-3,B!-86-I;G1O 7!E`````$YO;F4````)=&]P3W5T.E_5KI
M1KMOR[7`?:;2&6M94QWYM+G,JKL_[D?S%5F9]EOPK-SNK'I5CNF8EF!@8S-N
M'@TM97EY`B*FCU@ZKI..]Q]_J469WI?I?U*_]$N@O^RS5]I].?4'H^I'\Y!V
M>EO_`,+]+;L14E/%]&^J_6,7I#[7AV+GY1]?.QZ<@F_)M):YM65UJUEV1C8U
M?Z2FNG"_3T5_I/VAD7V6V6AP_J;UVOJ%=S;J,`UU,=9D8K`QIN^DZBJNO;GY
MF*W^
IOBETE\K/CM/\6?@M\%.L?BE_+XRFV,[
ML:/YH=V=78!NZ.VMI;KQ$^W]Q;X^*/6>\\7D>RLMF=[8.='QG;'8M=0%@\.0
MH,1G(%@<;#W6^PMJ=-=8;"ZOVDDN.V/U5L/:VPMLQY*M-3/0[4V-MZAV]ADK
M\C4:6J):;$8N,2SO8N5+'ZGW7YO3^;/\89NS,Y\?OC!'O3YU?)+!+%'ENI?B
MAAH-^8/9M35/-34TO;O?5=68;X]=.8N"NA:*K;/;GIJZ`JR1T<\X6!X."^$?
M:?R<[`VMW?\`S'=T;/[SZ
H8&$VW%QF9SK
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M_;OVN_DKD>N]:=U/IU5;*
G)E4WI.5&-Z
M:V,Y9"(_/@H\>#IX;7!M971A('AM;&YS.G@](F%D;V)E.FYS.FUE=&$O(B!X
M.GAM<'1K/2(S+C$N,2TQ,3(B/@H@("`\
ID0`````1G)'061O=6)`/@`````` M``````!&4W1S5FQ,
ID0`````3$-N=&QO;F<````````X0DE-4F]L;`````@``````````#A"
M24T/H0``````'&UF]/T9T%\%\)L3%=R]FX?;N$W-VUV
MCV_V%%4Y.AVKLN?=E'F=H[,V7M?%XR=:RJEQU?7U=4-">!>1*_FN=H?,WXB_
MR\/FK\A-C?(:AQ>[>F,9M;?716Y&7^4'QQ[3^$N/[8[I[
M^H>OMGXVM^*??^1P],<+M_`;_P!M[6P_7F[QNZLF,L>WZRAKJ_'"SR2>(,"(
MW\@CY+_)_P"6OQT[^[4^47=^4[@W1M+Y7=P]&;:B?9.PMEXC"[7ZJR-!CJ&K
MIZ;9VW,'+797-??-+4O4O($`145>2;Y/?O?O?O9#?F[_`#"^F/@A2;`E[4Q&
M\\]7=D5V5H]O8O9V,I*ZI,>$IHJG)5=5)75U#!#!3K41C]1)U7_!]D&_Z"#/
MBQQJZH[T!MR!A-NM;_D)<^5/^P-O?:_\*#/BKZ*_'25DN-Q$V%IJ*'3$LKLQ
M<&-W[\[:#XNU'5?0O>45?W=\M<_U'V#W1O#:/0>V:2@I*?JCJJJ<[V[7FQVZ
MMRTE+M[;\-)+'%1T+U]179'(*]-3)(X]L64_FT?&E=[_``:VOLS%=C=G;>_F
M%;,WUN[XZ]A;'PF,JML9B;86U9]VY+:^;I\KFL3G\1N.IH(3#'$U(R)5_M2,
MA5M*:WW_`#DOBUU@2]BX?LO8F>PO4>P.\N\]H;PPN#P&\?CAUQV7ND[*VK
M7]H[RD.C(8'/8]GUP5=+)'+&P^I
M!(.J#O'8/SM_X3B;KK>RNJ,[G?EC_*TS.Y:>7=VP-RU[2;QZ<&
WS@=P-V1@-\[#K*#>@K]P83'3TV1V]G:,2++,K:Y=.M;Y4!554L7*
MJ`7:VIB``6(``NWU-O86]PXZAR^U*'&9.FCK,?7;RV/3U=+(9%CGADW5B@T;
MF)T<*?\``@^UI@=K8';$=1%@L>F/CJG22H2.:IE$CQKH1O\`*9IM.E>+"P]J
M#W[VTY__`(L6:_[5.1_]PYO?S9\Q_P`#\K_X