The prospects for wine investment

“This wine was “extraordinary nose of caramelized herbs, smoke, cedar, ink, black currants, and earth. For a luxurious aromatics followed by a full-bodied, round, rich, juicy palate with low acidity”

was described by Robert Parker (the famous wine critic) their impressions of the tasting Lafite Rothschild 1982.

Another advantage, which is not referred to Robert Parker – the high quality of this wine as an investment. Wine lovers, who in 1982, together, scraped together £300 (£1028 in the modern equivalent) for 12 bottles (standard box) and have shown great strength of will, not soon, now sitting on nest eggs worth £28000. Few stocks showed such a result. Hoping to thwart such sum, investors poured and continue to pour money into collectible wine market which is currently estimated at 5-10 billion dollars.

The attractiveness of this asset adds and very limited offer: the best wines are produced in very modest volumes. The world famous Petrus (Petrus) produces only 2,500 cases a year.

The most significant manufacturers usually limit the possibilities of increasing the production of law and geographical factors. And it is impossible to reproduce weather conditions in which he was born Lafite 1982.

At the same time, the demand rose higher and higher, fueled by growing as the super-rich class that a collection of expensive wine was the highest manifestation of status.

Brokers advertising wine investment, waving in front of your customers the calculation with an average annual yield of 10%. But there is deceit.

Prices rose sharply in 2008 to 2011 in the Wake of demand from wealthy buyers from China, and this demand seemed inexhaustible. But he gradually blown away, as due to the slowdown of the Chinese economy, and as a result of relentless anti-corruption campaign, slugger desire for conspicuous consumption.

The price of Lafite 2008, targeted the Chinese market, has fallen by half from its peak in 2011. In General, the market, the prices since then are stagnant.

Worse still, the market remains quite narrow and illiquid. A deal can take a lot of time, brokers and auction sites take up to 20% Commission, and the lack of regulation contributes to the prosperity of speculators.

And, despite the emergence of online trading platforms (such as WineOwners) and price comparison services (such as Wine-Searcher) making an investment in wine is more transparent – the market is still on the side of those who are better informed. And while the choice of stocks to buy can be reduced to a predetermined algorithm, the selection of wines for investment remains very subjective and influenced by a small group of wine critics like Robert Parker.

So, alas: and then hangover is not uncommon.