Would you invest in fine wine? According to a report commissioned by Cult Wines – one of the UK’s largest fine wine investment companies, fine wine has experienced a growth of 234% over the last decade. Growth is set to continue as a shortfall in wine production -estimated at 2.8 billion, increases demand from wealthy buyers – currently standing at 3 billion cases.
Investing in fine wines was once the preserve of gentlemen collectors whose cellars were stocked with cases of claret untouched for at least 10 years. After this time had passed some wine – say two cases would have been drunk for pleasure and three cases sold on for profit – the profits made were reinvested in more cases of wine and the process would begin again. However, the wine collector demographic has transferred to China and India; whereby wealthy buyers are investing in fine wine as a wealth store – providing a hedge against inflation, protection against low interest rates and currency fluctuations.
Guy Tolhurst, Managing Director of Intelligent Partnership – the UK’s leading curator of education and insights on alternative investments, is positive about the benefits of fine wine investment:
“Wine collecting has been a hobby for hundreds, if not thousands of years, but more recently fine wine has been recognised as a genuine alternative asset class, providing significant diversification benefits from mainstream financial markets. This report examines the investment case and the risks and mitigations of what we think is an enjoyable, collectible, tangible asset with a fascinating history and a future worthy of serious consideration.”
The Cult Wines commissioned report seeks to educate investors and identifies the growth markets for fine wine. Marcus Allen, Head of Global Business Development at Cult Wines, comments:
“With investors paying ever more interest in this asset class as a way of effectively diversifying their portfolios, we felt that it was important to work with Intelligent Partnership to commission a report which would provide a balanced, independent and CPD accredited view of the Fine Wine Investment market. This will in turn help the financial adviser community in becoming more educated within this area of investment.
“As a specialist Fine Wine Investment advisory company, Cult Wines has always focused on providing market-leading research and reporting for the sector. With an increasing focus here in the UK and overseas of working with financial intermediaries, it was a natural step for us to commission this report in order to help facilitate these relationships and provide a reference point for the market as a whole.”
Investing in commodities are synonymous with risk, Guy Tolhurst also cites the importance of investors gaining valuable information pertaining to the fine wine sector:
“The last four years have clearly demonstrated that playing the fine wine market is not without its risks, but that those who use expert advice to identify good value, acquire and divest at the right times, diversify their collections and understand that this is not a short term, highly liquid investment, are likely to learn more about the sector and more fully profit from the potential benefits on offer.”
For further information about Intelligent Partnership and Cult Wines, please visit: intelligent-partnership.com