DubaiUnited Arab Emirates, February 11, 2023 /PRNewswire/ — A Big Change Within Portuguese Golden Visa Mutual Fund is a sudden spurt in the investment category.
Between the years 2012 and 2018 no Golden Visa applicant opted for the fund investment option, but after some investors opted out in 2019, the mutual investment fund option exploded into the Golden Visa scene.
In 2019, 0.56% of all Golden Visa applications came under the Fund option. This percentage will increase to around 4% in 2020, 9.35% in 2021 and finally 17.41% in 2022.
The interest in the funds as a route to the Golden Visa is understandable; They come with tax exemptions, a simple exit strategy and good returns on investment. They are less emotionally dependent than real estate, which relies heavily on personal preference. They don’t need to tour investors Portugal To check investment.
The increase in interest in investment funds under the Golden Visa has coincided with an increase in the number of US citizens applying, which may indicate a correlation, especially given how popular fund investing is in the US.
However, for many other investors, the concept of mutual investment funds may seem a bit foreign, given that they are not among the most common investment options in some countries, which is why it is important to apply under Fund Options to understand why. This is important for the applicant being considered. Most important criteria to consider while choosing a fund.
government surveillance
Under golden visa rules, applicants can qualify by investing in funds registered with the Portuguese Securities Market Commission, or CMVM. This ensures that the fund adheres to government regulations and is subject to official oversight.
Choosing a fund that is not registered with CMVM will not only lead to rejection of an application but can also lead to huge financial losses.
choosing the right level of risk
Different funds come with different investment options, many of which come with different risk levels.
Understanding the fund risk scaling parameter is important to ensure that investor’s money is safe and well utilised. Funds generally offer investors options across the entire risk spectrum, from very low to very high. The risk will always be there, but it is greatly reduced in the very low risk category.
However, it is also important to note that high-risk investments have a tendency to offer very high returns, so an investor may choose to go with higher risk for higher returns.
However, the most common methodology is spreading investments across the risk-averse spectrum, with the majority being less risk-averse. It is generally advised that a person should not invest more than 10% Their investments in high-risk ventures allow them to make good profit margins without risking large chunks of their money.
return rate and delivery
Another important factor to consider is the rate of return. Of course, this issue is related to risk, but Golden Visa investors are in a very peculiar position.
Investing under Golden Visa is generally a means to an end, and since investors have multiple investment options, choosing the right fund means getting returns at par with other investment options, namely real estate investment.
Real estate has been the most popular investment option under the Golden Visa since its inception in 2012. More than 95% of all applications fall under one of the real estate options, and although the fund option is gaining ground, an investor can still weigh both the options against each other.
In terms of returns, the average annual residential rental returns Portugal border between 5-8% Depending on the location and investment amount. The fund needs to be able to compete with those figures.
However, it is important to note that dividends received from funds have a lower tax burden than rental income and may be completely negated if an appropriate double taxation treaty is used. This means that the fund may come out slightly lower in terms of ROI percentage while ultimately providing the same gross profit.
The most important factor in fund ROI is the investment strategy of the fund, as this will determine the average return investors will receive. Some funds focus on low-risk investments that deliver consistent, yet low returns. Others may focus on arbitrage gains, investing in assets that have little value at the beginning of the fund investment period, but may provide massive returns as that period ends. These can provide a higher ROI than the average real estate investment, as they base their profit model on rent and appreciation rates. Specific real estate investment.
It is important to note that fund ROI is not consistent annually, as the amount can vary from year to year, and the overall ROI percentage can only be calculated at the end of the fund investment period, so it is important to understand is how and when the fund will make the bulk of its profits.
Treasury Manager
The last important factor to consider is the company managing the fund. It is important to choose a reliable fund manager to safeguard one’s investments and get the most out of them.
Many fund management companies also have multiple funds on offer, allowing investors to spread their investments among different options and risk levels while minimizing the investment management fees that most fund managers charge.
a complicated choice made easy
Investing in a fund for Golden Visa may sound like a complicated affair, but at Savory & Partners, we make it simple. our strong bilingual teams Dubai And Lisbon The offices help investors find the best investment options. Get in touch with our team of experts today.
For more information: Please send an email contact@savoryandpartners.com
You can also call +971 04 430 1717 or send a WhatsApp message to +971 54 440 2955.
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SOURCE Savory & Partners