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Just as the amount of direct foreign investment has mushroomed in recent years, so has the amount of foreign investment in Mexican stocks,
bonds and deposits. A large number of Mexican stocks are traded as ADRs on the New York Stock Exchange and many of the larger U.S. brokers and funds now have direct Mexican
representation. Most larger Mexican companies are registered for trading on the Mexico City Stock Exchange (Bolsa de Valores) and trading volumes have increased dramatically during recent years.
A few foreign mutual funds operate almost exclusively in Mexican securities and there
are hundreds of local mutual funds catering to the desires of both speculative and conservative investors.
Money market accounts, time deposits and income oriented mutual funds offered by
Mexican banks and brokerage houses are perhaps the country's most trusted and widely used form of investment. Interest rates offered are normally double those offered
in the United States and Europe, however, all deposits are of course denominated in Mexican pesos, so investors must carefully consider exchange risks before making a commitment to local markets.
Risks and rewards can be determined by comparing the U.S. dollar returns earned during the last five years from a relatively small peso bank deposit. The dollar returns
are based on a 50,000 peso deposit (roughly 5,000 dollars) made for 28 days at a time with interest compounded and taking the exchange rate into consideration.
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