Learning about fine wine has become an increasingly popular pastime for many, including Thibaut de Roux, who has more than 10 years of experience in wine tasting. Investing in fine wine is one of the more pleasurable investment options available to investors, who can work towards building a collection that is both enviable and profitable.
Wine investments are considered an ‘alternative investment’ like fine art, cars and antiques. These investments focus on the purchase of a physical object or tangible asset, the value of which is expected to increase over time. By investing in wine, investors are expecting to purchase and store their collection, with the hope of selling it at a much higher price in the future.
As with any investment, it is essential to know and understand the basics. In general, a wine’s vintage is one of the most important and influential aspects for an investor, as it will decide whether a wine is an appealing investment. The rarer vintages are preferable to the more common vintages for a simple reason: there are less of them, and they are therefore more sought after.
The region that the wine comes from is another important factor, as different regions have varying reputations. When it comes to region, it is wise to invest in wines that come from regions that are known for consistently producing high-quality vintages, as these are more likely to become successful investments. To date, investors have generally preferred wines from regions such as Burgundy, Bordeaux, Napa Valley and Tuscany.
As with other types of investments, diversification is important for a strong and stable portfolio. A wine portfolio should therefore include wines from many different regions and vintages, as this will ensure that your portfolio is well-rounded and protected from trends and fluctuations.
Timing is also important for the wine investor. As new wines enter your portfolio it is worth keeping an eye on the older wines that are reaching their peak maturity. Wines that are at their peak will tend to turn a higher profit. Therefore, wine investors are advised to pay close attention to the selection and variety of their collection, so they are able to time the sale of each vintage to turn the maximum profit.