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Has anyone had experience investing in fine wine, they seem to have produced some good double digit returns? Any help or advice would be appreciated!
Anyone invested in fine wine before?
- Thread starter investortom
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Hi Tom --
To my thinking invest is not quite the right word. If I make an investment, I call my lawyer and have the details written into my will. If I will probably sell the item before I die, it is a trade. If I will use it up and discard the remains, it is an expense.
My wife and I enjoy wine, drink it regularly, lead a local wine club of about 500 people, have made wine (we had barrels), visit local wineries, know winemakers well, and have several bottles at home. My wife and I have discussed between ourselves and with local wine merchants what to do with any wine left in our collection when we are no longer drinking it.
Merchants buy wine priced in hundreds of dollars and lower at wholesale at prices that are half or less of retail prices, so bottles purchased at retail will not give a positive return when sold.
Collectors want rare wines. Bottles priced in four figures. Trading collectables of any category is fraught with problems -- low liquidity, large bid-ask spread, counterfeiting, etc. Wine has the additional problems of being both variable in quality and perishable. Older might be better, but not always, and often only up to a point. One merchant tells us that the first question he asks of a private wine collection is how it was stored. Temperature fluctuation, or storage temperature above about 58 degrees Fahrenheit (24 Celsius), increases the rate of deterioration, as does vibration and light.
Buy good wine, drink good wine, enjoy good wine, share good wine. It is an expense. Not an investment. Not even a trade.
Best regards,
Howard
To my thinking invest is not quite the right word. If I make an investment, I call my lawyer and have the details written into my will. If I will probably sell the item before I die, it is a trade. If I will use it up and discard the remains, it is an expense.
My wife and I enjoy wine, drink it regularly, lead a local wine club of about 500 people, have made wine (we had barrels), visit local wineries, know winemakers well, and have several bottles at home. My wife and I have discussed between ourselves and with local wine merchants what to do with any wine left in our collection when we are no longer drinking it.
Merchants buy wine priced in hundreds of dollars and lower at wholesale at prices that are half or less of retail prices, so bottles purchased at retail will not give a positive return when sold.
Collectors want rare wines. Bottles priced in four figures. Trading collectables of any category is fraught with problems -- low liquidity, large bid-ask spread, counterfeiting, etc. Wine has the additional problems of being both variable in quality and perishable. Older might be better, but not always, and often only up to a point. One merchant tells us that the first question he asks of a private wine collection is how it was stored. Temperature fluctuation, or storage temperature above about 58 degrees Fahrenheit (24 Celsius), increases the rate of deterioration, as does vibration and light.
Buy good wine, drink good wine, enjoy good wine, share good wine. It is an expense. Not an investment. Not even a trade.
Best regards,
Howard
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Thanks Howard
, appreciate your advice. I have heard about people buying wine with a profit in mind. Buying good wines, Grange, Hensche Hill of Grace etc and holding for a number of years before selling, I do see a number of companies specialise in selling wines (Langtons, MW Wine etc) so I don't think I would have a problem selling. Has anyone done this kind of thing before and was it profitable? While I don't want to put my life savings into it, I think it would be a lot of fun and potentially profitable.
Craton
Mostly passive, contrarian.
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G'day Tom and welcome to ASF.
I've a mate who's right into wine, let's just say that he's in-the-know and been buying and sometimes selling wines for a long time. Over 30 yrs ago he converted two rooms of his PPOR into a temp. controlled cellar. Stocks wines from floor to ceiling. Amazing to see, eye popping.
If one considers the cost of:
As I said, old mate is into wines in a big way, knows the makers, regions and specializes in Hunter whites and big Barossa reds, he knows his stuff.
Funny seeing him pour a full bottle down the drain because of cork taint (that's how old a lot of his wines are) or for whatever reason, then calling the winery/wine merchant to advise which of the 5 V's (Vintage, Variety, Vineyard, Vigneron and Volume) went to compost.
So adding up the incomplete list as I'm sure I've left out stress, breakages and the like, is it profitable?
Good question. I've asked him on occasion and his reply is no. He does sell some of his aged wines he doesn't like through the year which buys more stock. One has to weigh up the list factors, especially the time component, and the ROI factors plus I guess the commitment to ageing the wine, if it's a passion am sure like my mate that it would be very rewarding. Drinking an fine aged wine is an exquiste experience I must admit.
Now if you're looking at investments such as: the Great Australian cask offer http://nant.com.au/barrel-offers/ and the like, well that's a different kettle of fish altogether. Case of DYOR.
I've a mate who's right into wine, let's just say that he's in-the-know and been buying and sometimes selling wines for a long time. Over 30 yrs ago he converted two rooms of his PPOR into a temp. controlled cellar. Stocks wines from floor to ceiling. Amazing to see, eye popping.
If one considers the cost of:
- Learning about wine. Spending hands on time in the field.
- Coverting the two rooms. Strengthening floors, walls.
- Insulation: floor, walls and ceiling
- 2 x reverse cycle thermostatically controlled air cons
- Racking (open and polystrene, etc)
- Security
- Electricity
- ...and the big one: TIME
As I said, old mate is into wines in a big way, knows the makers, regions and specializes in Hunter whites and big Barossa reds, he knows his stuff.
Funny seeing him pour a full bottle down the drain because of cork taint (that's how old a lot of his wines are) or for whatever reason, then calling the winery/wine merchant to advise which of the 5 V's (Vintage, Variety, Vineyard, Vigneron and Volume) went to compost.
So adding up the incomplete list as I'm sure I've left out stress, breakages and the like, is it profitable?
Good question. I've asked him on occasion and his reply is no. He does sell some of his aged wines he doesn't like through the year which buys more stock. One has to weigh up the list factors, especially the time component, and the ROI factors plus I guess the commitment to ageing the wine, if it's a passion am sure like my mate that it would be very rewarding. Drinking an fine aged wine is an exquiste experience I must admit.
Now if you're looking at investments such as: the Great Australian cask offer http://nant.com.au/barrel-offers/ and the like, well that's a different kettle of fish altogether. Case of DYOR.
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Sorry for the typo -- 58oF is about 14oC -- not 24.
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Winemaker Ben Glaetzer won a big award for his Heartland Shiraz.
A reporter asked if he would raise the price and then shoved a microphone up his nose!
Ben (Cool Dude) said "Nah Mate, I wanna shift the stuff"
Ben (Cool Dude):
http://www.wine-pages.com/features/glaetzer.htm
A reporter asked if he would raise the price and then shoved a microphone up his nose!
Ben (Cool Dude) said "Nah Mate, I wanna shift the stuff"
Ben (Cool Dude):
http://www.wine-pages.com/features/glaetzer.htm
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Do you mean after you filter it through your kidneys?
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Hahaha! I know I won't be investing in Heartland Shiraz then!!! That whiskey investing sounds interesting, though I've never heard of a secondary market, where and when would you sell it? Also I don't like whiskey. At least with wine I know I can sell it via one of the wine auction houses and not have to sell it directly to some pub who will not want to give me full value. Or I can drink it! Anyway, any further advice would be appreciated, I'm sure lots of people are doing and making money. I think my biggest problem will be I will be tempted to drink my investments! I'll need to keep it under lock and key!
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There are quite a few companies in the UK and US that offer fine wine investment but over here there are Cult Wines ( I think they are a branch of a UK company ) they are at
you can also try the auction houses like Langtons or Grays online
Whisky also seems to be popular and a mob down in Tassie are promoting it called Nant.
Do your own research though and if I were you even though alternative investments sound compelling, just like any investment make sure you own whatever you invest in just in case the provider goes belly up
you can also try the auction houses like Langtons or Grays online
Whisky also seems to be popular and a mob down in Tassie are promoting it called Nant.
Do your own research though and if I were you even though alternative investments sound compelling, just like any investment make sure you own whatever you invest in just in case the provider goes belly up
