Portugal Golden Visa Investment Funds (Full List, Eligibility & What To Look Out For)

Portugal Golden Visa investment funds are one of the best ways to get Portugal residency in 2024.

But navigating Portugal’s investment fund ecosystem can be overwhelming, especially if you’ve never invested in funds before. 

Our team has been researching funds in Portugal for over two years. In the process, we’ve spoken first-hand with many fund representatives (including all funds mentioned here), plus experienced venture capital professionals, tax lawyers, and cross-border financial advisors.

I’ve updated this guide with more robust and comprehensive information to help you navigate the world of investment funds in Portugal, after the Golden Visa program rules were changed in October 2023.

In short, Portugal’s funds are a highly regulated and professionally managed way to get your Golden Visa.

Disclaimer: Digital Émigré is not a law firm or financial advisor. This article is provided for informational purposes only. You should always consult a qualified financial advisor before making any investment decisions.

Overview: What’s Changed?

Since its launch in 2012, Portugal’s Golden Visa program has been a resounding success.

But in February 2023, the Portuguese government announced plans to make major changes to the Golden Visa program.

These changes were designed to tackle a growing housing crisis in Portugal. One of the key targets was the Golden Visa, which some political parties blamed for increasing the cost of housing across the country.

After much debate, the new law came into effect in October 2023. The biggest change to the Golden Visa was the total removal of all real estate investment routes from the program.

That includes direct real estate investment (both residential and commercial) and investment in funds that focus on real estate rehabilitation. 

Funds investing in Portuguese companies are still fully eligible for Golden Visa investment. This includes a range of venture capital and private equity funds investing in areas such as high-tech, hospitality, energy and sustainability projects, and agriculture.

We’re currently reviewing our list of funds to clarify their eligibility for the Golden Visa.

To qualify for the program, all funds must have at least 60% of their capital invested in Portugal.

All qualifying funds are closely regulated – by the Portuguese Securities Markets Commission (CMVM) and the Bank of Portugal. They also undergo independent third party audits on a regular basis.

Portugal Golden Visa Investment Funds List (January 2024)

What qualifies a fund for Golden Visa investment? 

To qualify for Golden Visa investment, funds must meet three requirements: 

• They must be first approved and then regulated by the Portuguese Securities and Markets Commission (CMVM – Comissão do Mercado de Valores Mobiliários)
• At least 60% of the fund’s investment units must be headquartered in Portugal
• The fund’s term of maturity must be at least 5 years (this allows the investor to hold the investment for the minimum time required to be eligible for citizenship)

Funds list

How Investment Funds Work 

What is an investment fund? 

An investment fund is a way for many investors to pool their money together into one professionally managed portfolio. 

The fund manager takes care of selecting a variety of investments like stocks, bonds, and other assets to include in the fund’s portfolio. 

When you invest in a fund, you buy shares of the fund and become a shareholder. 

You contribute money to the pool, and in return you get an ownership stake in the fund’s investments. 

When a fund sells one of its underlying securities at a higher price than was paid for it, the fund makes a profit. As an investor in the fund, you’ll benefit from a share of those profits.

The big advantage of funds is they give you the ability to access professional investment management, even as a regular investor. 

Fund management teams have the expertise to research and select investments across different companies, industries, and asset classes.

Different types of funds 

Private equity funds

Private Equity funds acquire mature, established companies that are past the startup phase. 

They provide capital to help privately held companies (not listed on the stock market) to expand, restructure or go public. 

Private equity companies look for businesses with predictable cash flows that would benefit from operational improvements.  

Private equity funds typically target:

• Established companies in traditional industries like manufacturing, retail, industrial goods
• Companies looking to expand production, enter new markets or revamp business lines
• Stable companies generating steady cash flows
• Undervalued or distressed companies that can be turned around with better management
• Candidates for buyouts, mergers and acquisitions or public listings

Venture Capital (VC) funds 

Venture capital funds are usually considered a subset of the private equity world.

They invest in early stage, private startups and small companies with high growth potential. 

They provide funding to get these businesses off the ground in exchange for equity ownership. 

Venture funds aim to invest in innovative companies and emerging technologies that can deliver outsized returns within 5-7 years. But there’s also a high risk of failure.

Typical investments for venture capital funds could include:

• Early stage startups still defining their business models
• Technology companies developing new platforms or innovations
• Healthcare and biotech companies with promising but unproven new drugs or devices
• Consumer products and services aiming to disrupt established markets
• Emerging sectors like cleantech, space tech, fintech

Source: Investopedia

What does Fundo de Capital de Risco (FCR) mean?

Only a certain subsection of Portugal’s investment funds qualify for Golden Visa investment. 

To be eligible (among other factors), the fund must be classified as Fundo de Capital de Risco (FCR). 

In English-language media, Fundo de Capital de Risco is usually translated as “venture capital funds”, conjuring up images of risky investments in unproven tech start-ups.

In reality, the term Fundo de Capital de Risco just means a fund with capital ‘at risk’ (i.e. it doesn’t guarantee a fixed return). 

That definition covers both the typical venture capital funds, as well as private equity funds. 

Fund Regulation in Portugal 

Investing in a foreign country is a major undertaking. An important part of the preparation process is understanding how your investment will be regulated. Portugal’s funds are subject to several levels of regulation.

Regulation at the EU level 

Investment funds in Portugal are regulated at EU level, under Directive 2009/65. 

This created a set of uniform rules governing investment funds, allowing for easier cross-border regulation. 

Key points in the directive include: 

• Standardized investor summaries, to make it easier for the consumer to understand the projects they plan to invest in
• Stronger supervision of funds and of the companies that manage them

Source: EU Monitor

Regulation at the Bank of Portugal level

Banco de Portugal (Bank of Portugal) is the central bank of the Portuguese Republic. 

It’s responsible for establishing rules and guidelines that investment funds (along with various other financial institutions) must follow when operating in Portugal. 

These regulations include: 

• Ensuring proper conduct by investment fund managers – requiring expertise, integrity and meeting of competence standards.
• Verifying that investment funds comply with specific rules around their offerings and strategies.
• Requiring clear and comprehensive information disclosure to investors about the investment products and services.

Understanding the key role of the CMVM

The CMVM (Comissão do Mercado de Valores Mobiliários) is Portugal’s financial regulatory body.  

The CMVM was created in 1991. Its mission: to supervise and regulate the financial instruments markets in Portugal, and promote investor protection. 

Its role is similar to the Securities and Exchange Commission (SEC) in the US, or the UK’s Financial Conduct Authority (FCA). 

Each investment fund in Portugal must be authorized by the CMVM before it can begin operations. 

As part of the process, the fund manager must provide CMVM with the fund’s documentation, including the key investor information document and the full prospectus of the fund and/or the fund’s management regulations). 

The fund manager must also provide information on all entities that will deliver services to the fund or fund manager. 

Governance is another important area where the CMVM regulates investment funds. Here are some examples of governance regulations: 

• All funds must be managed by licensed fund managers
• Fund managers must have boards of directors and audit boards for oversight purposes
• CMVM must vet and approve all board members
• Fund managers must set up and follow policies on risk, controls, outsourcing compensation, evaluation of assets under management, anti-money laundering,  record keeping and selection of board members. 

This high level of regulation and supervision aims to ensure proper management and protections for investors, along with confidence in the oversight of Portuguese investment funds.

Source: Habershon et al, 2023

It’s worth noting that investment funds are subject to far tighter regulations than Portugal’s property market.

Investment Fund Fees Breakdown

You’ll have several different fees to pay during your Golden Visa fund investment process, usually these three: 

1. Subscription fee
2. Management fee
3. Performance fee 

It’s important to factor in the fees when choosing your Golden Visa fund investment, as they will reduce the returns you receive overall. 

Let’s take a closer look at each type of fee, so you can understand what it’s for and how much a typical fee should be. 

#1. Subscription fee

Acquiring a Golden Visa in Portugal through the funds route now requires a minimum investment of €500,000 in an eligible fund. 

But you should also keep in mind that funds often charge additional one-time subscription fees, payable at the start of your investment. 

These go towards the administrative costs of establishing and launching the fund, including onboarding investors, anti-money laundering checks, and other legal and compliance procedures. 

The fee is usually calculated as a percentage of total capital invested. In my experience researching various funds, a typical subscription fee ranges from 1% to 3%. 

So if you wanted to invest the minimum amount to get the Golden Visa (€500,000), then you’d be looking at a subscription fee of between €5000-€15,000 on top of that.

Make sure you take into account the subscription fees when weighing up the potential of several different funds. Fund representatives should be happy to clarify their subscription fee structure for you. 

#2. Management fee

A management fee is paid annually by investors to the fund manager. It’s usually calculated as a percentage of the total funds committed by investors to the fund.

In Portugal, common management fees range from 1-2% of committed capital.

The management fee covers the fund’s overheads, operating expenses, and salaries for the fund’s management team.

Here’s how the management fee looks from the perspective of an individual investor. 

You commit a certain amount of capital to the fund – let’s say $500,000 as a typical Golden Visa investment. 

The fund charges a management fee each year on your total committed capital. So with a 2% management fee, you would pay $10,000 per year (2% of $500,000).

This annual management fee is either deducted from your capital account or charged separately on top of your commitment.

You pay this fee whether the fund makes money or not, as it covers the fund manager’s work in overseeing your invested capital. 

Management fees aim to cover the day-to-day costs of operating the fund. 

But the fund manager’s main source of compensation comes from getting a percentage of the fund’s profits once it exits its investments – known as the performance fee. 

#3. Performance fee

Performance fees are the main way that fund managers get paid. They motivate managers to make profitable deals, grow the fund’s assets, and generate a positive return on investment. 

They’re calculated as a percentage of the fund’s overall return, above an agreed hurdle rate.

For example, with a 20% performance fee and 8% hurdle rate, the fund takes 20% of any returns above 8%.

As an investor, performance fees come out of your share of the fund’s gains.

If the fund underperforms, you pay no performance fee until returns exceed the hurdle.

Performance fees align incentives between investors and managers – both sides want strong gains.

But high performance fees can also incentivize excess risk-taking by managers chasing volatile returns.

Overall, performance fees help to ensure that managers are compensated for their skill at investing, rather than just for assets kept under management.

Your Golden Visa Fund Investment and Tax

Investing in Portuguese funds could be a tax efficient strategy, especially if you’re not a tax resident of Portugal. 

In that case, Portugal doesn’t tax any of your gains on fund investments (although you should check how your current country of tax residency will tax your gains). 

On the other hand, if you’re a tax resident of Portugal, the tax rate is just 10% (whether or not you have NHR tax status).

The Pros and Cons of Fund Investment

Investor Requirements

To be eligible for the Golden Visa, you must be a non-EU/EEA and non-Swiss citizen, over 18 years old and with no criminal record.

To combat money laundering and fraud, all qualified investment funds will require you to provide evidence of source of capital.

The funds mentioned in this guide are all open to US citizens, although you may be subject to additional checks to comply with FATCA regulations.

Document Requirements

Here are the documents you’ll need for the Portugal Golden Visa investment funds route.

It’s important to prepare these carefully, as any inaccuracies or omissions can delay your application.

• Application form
• Receipt for payment of the application fee
• A passport copy for each person on your application
• Declaration from your Portuguese bank confirming the transfer of funds and that they originated outside of Portugal
• Proof that you’ve made the minimum investment (your fund manager will provide this)
• Health insurance policy covering Portugal
• Criminal record check from your country of origin or of legal residency of over one year (must be a certified copy and less than 90 days old)
• Authorization for SEF to check your Portuguese criminal record
• Proof no outstanding debts, both from the Portuguese Tax and Customs Authority and the Social Security system
• Your signed declaration stating your intent to follow the investment requirements (i.e. maintain the investment for the required period)

The Investment Process: Step-by-Step

Investing in funds is the fastest way to get the Golden Visa. Typical steps in the process are as follows:

• Step 1: Apply for a Portuguese taxpayer number (NIF)
• Step 2: Open a bank account with a Portuguese bank
• Step 3: Transfer sufficient capital for the investment into the Portuguese account
• Step 4: Make your investment of at least €500,000 in either one or multiple qualifying investment funds
• Step 5: Undergo KYC and anti-money laundering checks
• Step 6: Prepare and submit your Golden Visa visa application via your appointed lawyer on the SEF online portal
• Step 7: Once the application has been processed, attend your appointment to submit biometric data
• Step 8: Receive your Portuguese residence permit card

How to Choose a Fund

First, make sure the fund is regulated and eligible for Golden Visa investment. In this guide, I’ve only included funds that already meet those criteria – so you don’t need to worry.

Next, check out the experience of the fund managers. Do they have a good level of experience and the appropriate credentials?

Are their incentives as managers well-aligned with yours as the investor? (Typically yes, because their performance fees are based on how much the fund gains value).

Think about the fund’s wider strategy. Is it investing into a promising sector? Does its risk profile match your own?

How long will your money be locked in beyond the minimum period of five years? What sort of exit strategy does the fund have for the future?

Also, consider whether the fund’s investment focus aligns with Portugal’s wider national goals?

For example, real estate funds fell out of favor recently, after the post-pandemic housing crisis took hold.

As a result, funds investing in real estate ended up being kicked out of the program, along with direct real estate.

In contrast, funds which support Portugal’s environmental and/or economic goals, for example, remain very much in favor. Portugal’s government wants to support local startups, generate more jobs, and improve the country’s performance in terms of sustainability.

These are all areas you should discuss with fund representatives before choosing a fund/funds to invest in.

That’s why I highly recommend setting up calls with funds of interest.

It’s also worth seeking advice from an independent financial advisor before going ahead with any investment.

Exiting the Fund

Golden Visa-eligible investment funds all have to incorporate the five-year residency timeline to citizenship.

Most funds have a minimum lock-in period of at least six years. This ensures investors can maintain a valid investment long enough to apply for permanent residency or citizenship. But many funds may lock investors in beyond this period.

Hence, the minimal lock-in period is worth keeping in mind when you choose a fund.

Most funds also have optional extension periods, which they can use to go beyond the six year mark. Typically, the decision to extend is made by the fund managers, rather than the investors.

This may be inconvenient if you need to access your investment soon after getting your citizenship.

Some funds make extension decisions by holding a vote among all investors. We recommend that you check this point with all your funds of interest before deciding to invest.

Alternative Golden Visa Investment Routes

Here’s an overview of the remaining Golden Visa routes, since the new housing bill was signed into law.

Five routes still available

• Creation of at least 10 new permanent jobs (no minimum)
• Investment in artistic production and national heritage preservation (min. €250,000)
• Investment in scientific research activities (min. €500,000)
• Investment in Portuguese venture capital funds (min. €500,000)
• Investment to incorporate a commercial company, plus create 5 permanent jobs (min. €500,000)

The Golden Visa – Still Worth Getting?

No matter which route you choose, the Portugal Golden Visa has many benefits for you and your family members. With your Golden Visa residency – leading to Portuguese citizenship – you’ll achieve the following:

• Residency in a safe, stable, and politically neutral EU member state 
• Fast five-year pathway to be eligible for EU citizenship – which brings you full freedom to live, work, study and retire across the 30 countries of the EU and EEA (European Economic Area).
• Beat Brexit – if you’re British, regain your lost EU rights by acquiring Portuguese citizenship
• Dual citizenship – not every EU country allows it, but Portugal does
• Travel visa-free to 186 countries with Portugal’s well-respected passport
• Travel visa-free across the Schengen zone with your Portuguese residency permit 
• Flexible minimum stay – your choice either to live in Portugal, or just visit for two weeks every year 
• Free healthcare – Access to Portugal’s good quality state healthcare system 
• Tax benefits – Preferential tax treatment on your worldwide income (if you decide to live in Portugal) with Portugal’s generous NHR tax scheme. 

FAQs

If you have another question about funds that isn’t listed here, please contact us.

Next Steps

Investing in funds for the Portugal Golden Visa offers a high level of speed and efficiency at a reasonable investment threshold of €500,000.

You can reach this threshold by investing in as many funds as you want (as long as you meet the individual threshold set by each fund) – making it a straightforward process to diversify your portfolio and effectively manage risk.

In 2024, investing in funds is the smart choice for getting a Portugal Golden Visa in the fastest and most efficient way possible.