Mexico is emerging as one of the world’s fastest-growing markets for exchange-traded funds (ETFs), reflecting strong demand for financial innovation and a shift in investor preferences. 

Joseph Nelesen, director of investment strategy specialists at S&P Dow Jones Indices, made the disclosure at the GBM Forum Pioneros 2025 for financial advisors in Latin America’s second-largest economy, highlighting that growth in Mexico’s ETF market is outpacing many larger economies.

“Mexico overall, as a fund market, is among the healthiest in the world,” Nelesen told MBN. “Relative to its size, Mexico is probably the fastest-growing market globally when it comes to ETFs and index investing.”

Institutional investors were the first to embrace ETFs, particularly pension funds, or Afores, which recognised structural advantages over traditional mutual funds. Over time, retail investors also joined in, supported by digital trading platforms and expanding financial education.

ETFs’ appeal lies in their simplicity, cost efficiency, and transparency. Once investors experience these benefits, they often prefer ETFs as tools that provide autonomy and control. Findings from S&P’s SPIVA reports confirm the trend toward passive products. 

Over a 10-year period, 82 per cent of Mexico’s equity funds underperformed the IPC index. Even top-performing managers have struggled to maintain results, with many slipping in rankings over time. 

This has made ETFs increasingly attractive as a way to “own the market” without the pressure of outperforming it. Although digital platforms enable self-directed trading, more investors are seeking professional advice. 

Just a few years ago, more than 40 per cent preferred to trade independently, but that figure has dropped to 25 per cent. Nelesen cited that people are now turning to advisors not primarily for performance but for guidance on risk tolerance, needs, and long-term goals.

ETFs and model portfolios give advisors scalable tools, freeing them to focus on building trust and deeper client relationships. Nelesen also pointed to the rise of sustainable investing. What began as a moral consideration is now viewed as a source of opportunity. 

The S&P Global Clean Energy Index, for instance, has drawn strong inflows as investors increasingly see renewable energy as both forward-looking and profitable. 

As Mexico continues to expand access to ETFs and index investing, the combination of cost efficiency, transparency, and personalised advice signals that the market’s transformation is only beginning.