Wine: a promising investment
Wednesday, July 21st, 2010Wine: a promising investment
In a time of economic uncertainty , investing can be a nail biting practice. The stock market in these times has proven sorely undependable at returning profit.We can notice that the investments are dropping all over the world . today, investing in real, touchable assets is frequently a smarter move than stocks . Fine wine investment is appropriate to consider as an investment option. Money Observer recognize fine wine as a promising investment.
Why fine wine? Wine prices have a strong tendency to increase with age. This is especially true of fine red wines such as those from Bordeaux. When examining such wines it is very important to look at several factors. First, location—where a wine is produced (its terrior) is one of the first aspects of the wine that is considered, because the actual growing location of the grapes is a strong determiner of quality. Second, vintage, or the year the wine grapes were grown. Most red wines are not released for at least 2-3 years after the year the grape is harvested. Wine is strongly influenced by changes in weather between years. Taking the same wine, from the same vineyard, one year can be rated “excellent” and the next year can be a disaster. The ultimate quality of wine is truly in the hands of nature. This makes it vital to stay informed. Knowing your vintage quality is key! Third is the tried and true rule of supply and demand. The best wines are produced in very small-scale quantities.
Once your vintage type, year, and location are elected, when and how should you buy the wine? One of the best ways is to buy En Primeur. This means to buy it before it is bottled. Wine prices often shoot up after bottling, and the smart investor buys at the cheapest, right?
If buying in the European Union , it is best to buy the wine “bonded” so it will be free of Duty and VAT taxes. Businesses , such as Berry Bros & Rudd offer En Primeur wine investment services. They can propose a safe place to store your wine. Wine storage is key to keeping your investment. Many high quality wines get ruined by improper storage conditions. Fine wines are sensitive to temperature and light and should be stored in a temperature controlled cellar. Set out building your alternative portfolio with fine wine investments today !