J 2012: by Peter Shakeshaft 36 entrepreneurcountry
A fine time to invest in fine wine
oan Collins once famously said: “Age is just a number. It’s totally irrelevant unless, of course, you happen to be a bottle of wine.” Time means everything in the wine industry and 2012 is an
incredibly exciting time to invest in fine wine, often referred to as “liquid gold”.
Over the last five years, fine wine investment has delivered double digit annual growth of 66 per cent. However, this year more than ever, a unique set of circumstances have come together to provide the perfect conditions to consider investing in an asset class which has traditionally performed well in times of recession and yet is not generally understood by the average private investor.
Wine follows the ‘rule of three’ that is applicable to alternative investments. Firstly, and crucially, it is a finite resource. Each Chateau produces between 12 to 18 thousand cases per vintage, meaning that there is only a limited supply of each yield. Naturally, therefore, the more a particular vintage gets drunk, the more valuable the remaining cases become. Secondly it is tangible, you can put it in your cellar overnight and sleep safe in the knowledge that it will be there in the morning thus removing the risk of the turbulent equity markets. And thirdly, it will diversify a portfolio. In difficult and turbulent economic times, the best portfolios are diverse, avoiding the situation of putting all of your eggs in one basket.
In addition to diversifying your portfolio into the wine sector, there is also the opportunity for diversity within
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