3 Comma Capital
IMI Official Partner
Author: Nuno Serafim, Managing Partner and CIO of 3 Comma Capital.
Despite the 2023 closure of its popular real estate investment route, the Portuguese Golden Visa remains one of the most sought-after investor residency programs in Europe—and indeed, across the world.
One alternative that has gained significant traction among international investors is the fund investment route, which requires a minimum investment of €500,000 in liquid asset funds (holding bonds, stocks, or alternative liquid assets) or venture or private capital funds incorporated under Portuguese law.
Choosing the right investment vehicle is crucial, as it can greatly influence both financial returns and peace of mind during the mandatory five-year holding period. While equity-heavy funds have long been viewed as a conventional option, an increasing number of investors are recognizing the sweeping advantages of bond-focused funds—especially Portuguese corporate bonds—for those seeking stability, predictable income, and balanced growth.
Acknowledging the increasing demand, 3 Comma Capital (3CC), a Portuguese alternative asset management and venture capital company, launched the Portugal Golden Income Fund—an innovative solution that provides a unique mix of Portuguese corporate bonds (investment-grade), U.S. equities, and Bitcoin. It focuses heavily on bonds to deliver an attractive combination of capital preservation and equity-like returns through a systematic barbell strategy approach.
This article examines what makes corporate bonds a compelling Golden Visa investment and what sets the Portugal Golden Income Fund apart.
The Case For Corporate Bonds In Portugal
Portuguese corporate bonds are the backbone of the Portugal Golden Income Fund, comprising 70% of its portfolio. This allocation reflects the inherent strengths of the bond market in Portugal, particularly for foreign investors:
Stability and Capital Preservation
Bonds are inherently less volatile than equities, offering a predictable income stream while safeguarding the principal investment. This is particularly important for Golden Visa applicants, who are required to hold their investment for a mandated 5–6 years.
Broader Investment Options
The Portuguese equity market is limited, with only 5–6 investable stocks. In contrast, the bond market provides access to a much wider range of high-quality companies, including state-owned enterprises like Caixa Geral de Depósitos (Portugal’s largest bank) and Fidelidade (the country’s largest insurance group). These companies do not issue equity but offer bonds with excellent credit ratings.
Above-Average Returns
Portuguese corporate bonds pay a premium relative to their European peers while maintaining comparably low default rates. Historically, these bonds deliver 3.5% to 4% annual returns, outpacing many low-risk asset classes. This premium, combined with their stability, allows bonds to generate returns that exceed expectations for a conservative investment, making them highly attractive for investors seeking predictable income and capital preservation.
Who Benefits Most From Bond Investments?
Bond investments are an excellent choice for those who value stability and predictable returns over high-risk strategies. U.S. investors often favor corporate bonds for their steady income and lower volatility, especially within open-ended, liquid funds.
Retirees, who are typically risk-averse and time-sensitive, also prefer bonds for their fixed returns and accessibility. Similarly, Golden Visa applicants can benefit from bonds’ stability during the mandatory 5–6-year holding period, offering a secure way to meet residency requirements while avoiding the unpredictability of equity-focused funds.
However, this doesn’t mean equity-heavy funds are a poor choice; for investors with a higher risk tolerance or those seeking aggressive growth and returns, equity funds are still a viable option. The decision ultimately depends on individual financial goals, risk appetite, and investment timelines.
Stability And Growth: A Balancing Act
The Portugal Golden Income Fund isn’t solely about bonds—it’s a carefully constructed, multi-asset portfolio designed to balance stability and growth. Alongside the 70% allocation to corporate bonds, the fund’s central allocation also includes:
15% U.S. and World Equities
This allocation provides exposure to global growth markets, particularly in sectors with a strong track record of performance and maximum diversification, unlike having a core exposure to a low-diversified Portuguese stock market.
15% Bitcoin:
Digital assets are a higher-risk component of the portfolio but offer significant upside potential. By capping Bitcoin exposure at 15%, the fund mitigates its volatility while enhancing long-term profitability.
This balanced structure ensures that the fund captures the best of both worlds: the stability and predictability of bonds alongside the growth potential of equities and Bitcoin.
Why Fixed Income Is A Smart Choice For Golden Visa Holders
One of the key advantages of a bond-focused portfolio is its ability to generate consistent, recurring income. Bonds produce predictable cash flow, which can be distributed to investors through share class structures. This feature is particularly appealing for foreign investors who often prefer steady returns during the holding period required for the Golden Visa.
Additionally, bonds provide a natural buffer against market volatility. During economic downturns or periods of heightened risk, the steady income from bonds helps offset potential losses in the riskier segments of the portfolio.
Addressing Bitcoin Volatility
Bitcoin’s inclusion in the Portugal Golden Income Fund reflects a forward-thinking approach to portfolio construction. While Bitcoin is undeniably volatile, its long-term growth potential makes it a valuable addition to a diversified portfolio. By limiting Bitcoin exposure to 15%, the fund ensures that its impact on overall volatility remains minimal. Additionally, the correlation between Bitcoin and Portuguese corporate bonds has historically been quite low, making this combination particularly attractive from a risk diversification perspective.”
Should Bitcoin reach valuations of $300,000—as some experts have predicted—the fund’s performance would comfortably exceed its return targets. This approach allows investors to benefit from digital assets’ growth potential without overexposing themselves to risk.
Flexibility And Liquidity In 3CC’s Portugal Golden Income Fund
Unlike closed-ended funds, which lock investors in for up to 8 years, the Portugal Golden Income Fund is an open-ended, daily liquidity fund, meaning all assets in the portfolio are liquid and can be readily converted to cash. This structure provides investors with greater transparency, flexibility, and reassurance.
Moreover, the Portugal Golden Income Fund simplifies the investment process for U.S. investors and other foreigners by eliminating the immediate need to open a Portuguese bank account. 3 Comma Capital’s Global Custody Account can receive international wire transfers directly in EUR or USD, saving on exchange rate conversion spreads and allowing for direct IRA investment (IRA custodian compatibility). This streamlines the process, enabling investors to avoid unnecessary delays and costs, and makes the fund an accessible option for those seeking a quick and low-risk entry to the Portuguese market.
As such, the Portugal Golden Income Fund underscores the critical role bonds can play in meeting the needs of Golden Visa investors. By prioritizing Portuguese corporate bonds, the fund not only aligns with Golden Visa requirements but also supports local businesses while offering predictable returns and capital stability.
You can find the register of 3 Comma Capital at the Portuguese Securities and Exchange Commission (CMVM) website here, and our fund that is eligible for the Golden Visa is registered here.
The Portuguese Golden Visa is widely regarded as the best residency-by-investment program in Europe. With a €500,000 investment in an approved fund and only 7 days of annual presence in Portugal, you can secure your European residency (and after 5 years apply for citizenship) without relocating—check 3 Comma Capital’s blog or contact us via our website.
