Special investment funds, writes global research house Synovate, “mostly specialising in the Bordeaux wineries of Lafite [Rothschild], Latour, Chateau Margaux, Mouton [Rothschild], Haut-Brion, Cheval Blanc, Ausone, Pétrus and Chateau d’Yquem have brought wine to an increasing number of investors, particularly in China.”
The report quotes Benjamin Curtis, of Singapore-based investment fund Premium Liquid Assets, saying that wine is attractive because of its high capital preservation.
“Historically, he says, a good vintage of the top wines from Bordeaux shows positive price appreciation, with the best vintages of first growth wine doubling in price in only three to five years.”
The Synovate report said the trend indicates a relatively small number of consumers who have the highest standards, want the most well-known brands and, in the case of wine, ultimately the most expensive.
“This pattern is a proxy for wealth generation in China and has been a bit of a boon, particularly for Bordeaux, in an otherwise tough market,” the report stated.
However, wine as an investment commodity means that some owners are never going to enjoy the wine they own.
“Some people would say wine is for drinking, which is fine,” Curtis said. “We do have collectors as well, high-end collectors who deal with the labels we’re dealing with, using the profit that they’ve made, effectively, to be able to drink the finest wines for free.”
However, it is the hard-nosed investor – unlikely to ever see the case of wine that they have bought – who is driving prices through the roof, he concluded.
I though I would add the BBC is reporting that “a single bottle of wine has sold for £135,000 in auction.The six-litre bottle of 1961 Chateau Latour was sold in Hong Kong by London-based Christie’s auction house. The sum was more than three times the expected price. Wine experts said the bottle was of ‘perfect provenance’.”