Fees for Optimize fund vs IMGA Equities fund

Residencies & citizenships Portugal Golden Visa
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UPDATE - below is my original post but there’s hidden charges with bank fees for holding units of a fund in a bank which is NOT needed with Optimize and can be avoided with Optimize since they don’t require a third party depository bank . I will post another update.. thank you to everyone here who responded.

Original post:

Hi all

I am trying to decide between investing in IMGA Equities Acoes or the Optimize Golden Opportunities Fund since they are pretty similar strategy wise.

I was leaning towards IMGA because they are better known and established but was put off by their seemingly much higher fees.

But after studing the prospectuses of both funds am I mistaken in thinking
the fees for both funds are quite similar? Especially if one splits the Optimize subscription fees of 1% over 5 years of holding the fund for GV purposes (thus adding 0.2% to the annual fees).

IMGA Class R Acoes Fees: 2.41% (2.26% mgmt, Depository 0.08%, Supervision 0.01%, Stamp duty 0.05%)

Optimize for 2023: 2.16% ( Mgmt fees 1.872%, Depository 0.094%, Supervision, 0.02%, research costs 0.101%, Audit costs 0.011%, other costs 0.052%)

Optimize for 2024: 2.064% (Mgmt fees 1.872%, Depository 0.094%, Supervision 0.015%, research costs 0.003%, Audit costs 0.022%, other costs 0.052%)

So the Optimize fund cost after adding a 0.2% annualized subscription fee is around 2.26% to 2.36%.

So both seem quite close cost wise.
Am I mistaken? Any feedback is much appreciated.

thanks!

PS - Both have similar strategies - there are some differences of course. Optimize can hold more in bonds while IMGA has held a big position in cash as I read on the forums.

The performance is also very similar with IMGA perhaps marginally better:

IMGA Class R returns Annualized 1y 32.7% 2y 17.2% 3y 16.37%
Annual yearly performance starting from 2022 onwards: 4.62%, 14.73%, 3.51%, 32.7%

Optimize returns Annualized: YTD 23.4%, 3 yrs 14.9%, since inception 12.8%
Annual yearly performance starting from 2022 onwards: 4.2%, 17.3%, 6.3%, 22.7%

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@slowreader This is a more detailed analysis of the fees than I can comment on. I don’t know anyone at IMGA, but I would be happy to reach out to someone at Optimize for a comment on this, if it would be helpful to you. Maybe someone else has a contact at IMGA?

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Thanks Debbie. I got these numbers from the prospectus of each so I assume they’re accurate.

I was just wondering if my thinking that they’re very similar in fees is correct or not. Or if you have any other data on the two that would help me decide. Thank you.

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This an order of returns problem. The optimize returns would be lower since they take more money from you up front. You should do theoretical same returns for both funds for five years while taking out the fees as they would happen. Fees for both of these are high regardless though.

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This is bikeshedding-adjacent at least.

The returns are not optimal in any GV investment. You’re investing in the residency and chance at citizenship, not actually good investments. They’re close enough to each other, just pick one and spend your (precious) time on something more important.

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Hi Shaun-
I do not know much about IMGA, and the fees as you describe seems pretty similar. I chose Optimize and have been very pleased. They have been very responsive to any questions I have had, and very helpful. I am not sure if IMGA can do this part or not, but Optimize also qualifies as your ‘bank’ for the GV process, so you possibly would not need to open bank account in Portugal. I invested via my Self Directed IRA and did not need to open a bank account (more fees there too!).
Hope that helps a bit, best of luck

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It’s pretty similar. We chose Optimize for the bond mix. In theory with bonds in the mix, the returns can be a bit less but also the risk should be lower. We viewed this as wise because concentrating on just one country is already pretty risky, and our main goal was to preserve capital more than to grow capital. This is what we thought, not financial advice, your mileage may vary.

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Thanks @Tatley . I actually had a bank account already since I had initially thought of going for a closed ended fund but then after reading the forums I decided an open ended fund would be the safer route in case of delays or changes in the laws.

But yes Optimize is unique in the sense that one can invest directly with them.

IMGA does not offer this and the units have to be purchased via a bank.

Thanks.

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Thanks @benerus. Thats sage advice about preserving capital with bonds in the mix for Optimize. Worth considering. Thank you.

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You’re not calculating the time value of money. Over a 5 year period assuming a 5% return, you are around .231% not .2%. It gets worse if expected returns are higher.

I’d try negotiating the fees down with both before you decide.

Also, I’m fairly certain optimize has a withdrawal fee and IMGA does not. I primarily invested with Oxy, so I’m not suggesting either. Just making you fully aware.

I was initially attracted to IMGA because it had the least cost if I changed my mind after any legislation.

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Thank you for the reply @MB101. None of the funds I have talked to (I think I approached all the open ended funds) have been willing to negotiate on any of the subscription fees. They claim that they have to treat all investors equally.

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My read of Optimize is that they do not have a redemption fee.

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I agree with Paul, I dont believe there is a redemption fee. I think the only cost is the subscription fee. They were very responsive to me when I was deciding, and ever since I invested. I would take the time to contact them and get the correct answers.

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I’d recommend reaching out to Optimize directly. Pedro Lino, their CEO, was spectacular when we were going through this stage of the process in late 2024. He’s always been available and super responsive - his team as well.

They run a great operation in my opinion. You can write Pedro at pedro.lino@optimize.pt.

Of course, another idea is to just hedge and put split your investment between the two firms.

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Does IMGA require a bank to hold the securities? If that is the case, the original poster is going to have their head spin with the convoluted AUM fees, transfer in and transfer out fees as well as percentage of gains that these banks charge.

Also, I was wrong about redemption after looking at my notes. I will say one of those two firms will negotiate rates. Worth another bite at that apple.

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@djlincoln - thank you! Good idea splitting the investment.

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@MB101 yes Optimize is quite unique in that they don’t require a separate bank account. Thats a good data point on the confusing banking fees.

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I bought it a year before you, and my current concern is how to keep profitable positions. I vibe coding a webpage to analyze this matter. https://amoukyou.github.io/PTOPZWHM0007/

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The other novel program Optimize offers is the SD-IRA option - a very handy tool.

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One mistake in your apples to apples comparison is to spread the 1% subscription fee over five years for Optimize. Given a long term expected return rate of 6-7% (past returns are not indicative of future results, blah blah), your calculations are the equivalent of a performance fee or expense ratio rather than an initial sales load in your first investment in that you’re applying a 0.2% cost on your balance in years 2-5.