A good case for investing in wine

Posted on: 14 January 2010 by Mark O'haire

Sam Gleave, sales director at fine wine merchant Bordeaux Index, explains how you can turn a passion for wine into an astute investment.

Investment in wine is nothing new. For centuries chateaux, merchants and private investors have traded in fine wines, and made money from it.

Fine wine is a resilient asset and, much like diamonds or gold, is seen as a safe haven and most beneficial to those with a long term view.  Over the last quarter of a century it has proved to be a consistently stable, high yielding and low risk investment, and records show that fine wine has remained generally unaffected by stock market fluctuations and interest rate changes.

Unlike other investment vehicles, wine improves with age. A good vintage becomes highly sought-after, and the higher the demand the more investors will pay.

How to get started

Anyone who has a passion or interest in fine wine can invest, from a case of your favourite Bordeaux to a cellar stocked with thousands of bottles.

The first piece of advice is do your research. Read books and wine columns in newspapers and wine publications, and ask your wine merchant for help.

Next, decide how much you want to initially spend. Anything between £3,000 and £5,000 will get your cellar off to a good start, and ensure you get a number of top quality wines that will give you some healthy returns.

Red Bordeaux is always a good and safe starting point, though red Burgundy can be a shrewd investment too. Make sure you’ve explored different vintages, as some are better than others. The vintage year will also indicate when to open a bottle, and how long it should be left to mature.

Buying en primeur

En primeur is a way of buying young, sought-after wines before they are bottled, and usually means paying less, though delivery will be one to two years after payment. This practice is most common with Bordeaux wines and takes place every spring.

Buying in bond

Buying wine in bond means the price excludes duty and VAT, and that is has not passed through customs and officially entered the UK. Wine in bond can be stored in bonded warehouses until it is exported or taken out for drinking.

Storing wines at home

If you plan to store your wines at home you’ll need to create the perfect environment, in terms of light, temperature and humidity. You may also need to check that your contents insurance covers your wines. A larger collection may require you to take out a stand-alone insurance.

Bonded warehouses

For total peace of mind you may want to consider warehouse storage. Bordeaux Index offers storage facilities which provide the perfect environment for your wines.  Our warehouse is fully insured, and has the added benefit of storing your wines ‘in bond’, so you can defer paying duty and VAT. Clients are also offered a secure login service for those who wish to view their ‘cellars’ online.

Wine diary

No matter what size your wine collection, it’s always a good idea to keep a wine log or diary. This should include the original price, storage history, the wine region and chateaux.  You could even add your own tasting notes.

For more information about investing in fine wine and for details of storage facilities contact Bordeaux Index on +44 (0) 20 7269 0703 or visit www.bordeauxindex.com.

Bordeaux Index – wine selection simplified

Bordeaux Index is one of the largest fine wine merchants in Europe, and prides itself on its no-nonsense, unstuffy approach to wine selection.

Passionate about only the finest, high-quality wines, Bordeaux Index has excellent contacts throughout the world, and can source the rarest, most sought-after wines. Every client receives a first-class, personalised service, from recommendations on the best wines for drinking, to in-depth market analysis and advice on investment.

Always keen to look to the future, Bordeaux Index has recently launched a revolutionary two-way trading platform - LiveTrade, a first in the world of fine wine trading. 

Visit www.bordeauxindex.com for more information, stock lists and advice on wine for drinking and investment.

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