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Wine Investment Feature


LIQUID ASSETS


Investment Entrepreneur Freddie Achom on the Fine Wine Investment Market


His newly-formed wine investment consultancy Boington & Fredericks of London had just been suspended from trading by the Department of Trade and Industry for mis-selling wine as an investment. The idea of advising clients to bed down fi ne wine for investment and charging a premium for this service seemed to be somewhat farfetched to fi nancial regulatory boards. “Back then we were selling Lafi te ‘96 for £3,900 a case while ordinary merchants were selling at approximately £2,000 per case with no value adds. The promise of good returns seemed farfetched, to all and sundry it looked like a non-starter and the general opinion was that most would never see a profi t”, says Achom. “Today the Lafi te ‘96 is worth in the region of £15,000 per case. It was hard then to prove the viability of the market, market data was hazy at best and there was little or no press in favour of wine investment. Today, there is an article every week”, he continues.


T The faith that those like Achom have


shown in the market has certainly been rewarded with the wine market increasing from a £7billion-a-year market in 2001 to today’s £14billion-a-year valuation and continuing to grow each year. Industryfi gures show that approximately two percent of all wines produced globally are considered to be of suffi cient quality to rise in value and very few ever break into this tier. The


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en years ago this November, Freddie Achom was contemplating his future, as well as the future and viability of the wine investment market.


fi nancial benefi ts and principles are more in demand than they have ever been. Today, Achom is the founder and


chairman of the offshore-based Rosemont Group who, among its portfolio of companies, own the majority stake in the London-based wine advisory fi rm Bordeaux Wine Company in partnership with wine enthusiast Anthony Grant. Grant feels they have been vindicated by the performance of the market over the past decade. He says he feels proud to have stuck at it for so long and has been able to see the market fl ourish as he always thought it could: “I always knew it would come good”, he exclaims, “the fundamental principles of this market are clear for all to see and people have fi nally woken up and realised that wine is just as viable as any other commodity if not more”. Prior to the past decade the fi ne wine


Top: A case of Lafi te 96, Vintage barrels Right: Grand Vin De Bordeaux 1982, Chateau Des Bertins


“blue chip” Bordeaux or “fi rst growths” as they are called are the dominant force when seeking wines that can accrue value over time; they now account for over sixty percent of wine auction sales worldwide. With the emergence of the Far East and South America as major forces in the fi ne wine market and little or no real knowledge of wine, the need for advisory is today even more apparent. Wine advisors like Achom with their vast knowledge of wine and the


market has been a patient mans market and although the likes of Achom and Grant speak of huge returns in the last few years, it is still very much advised to look at this with a medium to long term perspective and abiding by a few basic rules should steer you clear of any potholes. Carolyn Holmes, senior wine specialist at Christie’s of London believes “any wine you buy for investment needs a good reputation and long track record of success”, while Enzo Giannotta, MD at Cult & Boutique Wines, who specialise in new and old-world wines advises to “take advice from those in the industry but make sure you stick to blue chip wines, the fi rst growths, as they are consistent and proven; buy early, preferably en primeur (wines still in the barrel) but only from established merchants. Last but not


Freddie Achom


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