Wine Investment: Pros and Cons

Wine investment is both business and pleasure. Bringing the two together should surely be a marriage made in heaven?

How would you like a regular supply of fine wine that costs you nothing? You would need to make the initial outlay, of course, but after that the wine keeps coming—a bit like solving the conundrum of perpetual motion.

The answer is—canny wine investment. In essence, you buy more wine than you intend to drink and sell the excess at a later date to fund subsequent purchases. It’s a high-risk game because, unless you’re extremely knowledgeable (and lucky), it may be that you can’t sell your wine with the profit you need in order to stock up again from the proceeds.

Another element in this equation that brings us down to earth is the general theory of reality, which is that ∞ = infinity, meaning that I may have to wait a very long time indeed before the wine I buy in 2016 has increased significantly in value to afford me enough profit to … etc., if you get my drift.

There’s also a demon called Temptation in many bottles of fine wine whispering ‘drink me!’ That magnum of Lynch Bages 1966 shared with friends all those years ago still haunts me—what might it be worth today! Even more intriguing—what sumptuous mouthful of perfection would it deliver today? Lock the cellar door and throw away the key is my advice, or put miniature chastity belts on your finest bottles of wine.

For strong-minded collectors of wine there are of course good returns on the very finest, destined never to be drunk, but instead passed down the line of waiting investors.

See also: Wine For Cellaring and Wine For Drinking

Most fine wine once bottled improves with age, as everyone knows. If we’ve been able to buy several cases at one time, don’t you think we should just check on the level of improvement from time to time? Isn’t it important to our knowledge and understanding of fine wine to … taste? The great ones, the really great ones we have had the privilege of tasting, we even remember the exact moment when that famous Pomerol was uncorked.  But no, we can’t do that because we’ve thrown the key away, remember?

So, if you can keep your wine investment safe, you can stand to turn a profit as the wine becomes scarcer—only a limited amount of fine wine is produced and as bottles are consumed the scarcity value increases. A five-year period would be considered a short-term wine investment by most experts, with ten or more years being a better plan for wine investment.

The most reputable wine merchants will advise that only certain wines are set to accrue in value and these wines will tend to be expensive from the outset. For many years the general rule has been to invest only in the highest quality wine from Bordeaux and Burgundy, and although this is a safe strategy, there are some very good investment opportunities in wines from other regions coming onto the market, not only regions in France, but in other notable regions of the world, such as South Australia’s Penfolds Grange.

Seeking reliable advice about wine is the safest route to investment success. In the UK, indeed in the world, Berry Bros & Rudd is a leafing wine merchant expert on the topic of wine investment. It is always worth tracking the major wine auction houses, too, where expert advice can be found for the serious investor.

For example, Sotheby’s leads of a January sale of Finest and Rarest Wines with a collection of Bordeaux and Burgundy topped off with Salon Champagne. Bordeaux features an Imperial of Mouton 1989, a trio of Lafite vintages—1998, 1999 and 2000—complemented by Cheval Blanc 1999, Figeac 2000 and Trotanoy 2001. Highlights from Burgundy include La Tâche 1983 and a selection of 2006 Leflaive. There must surely be compulsory purchases here, as well as compulsory tasting of your purchases to ensure your long-term wine investment starts well in 2016.

See also: Great Grapes and Sublime Wine 

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