The following article is an extract from our Q1 2024 Fine Wine Report which will be published in full later this week.
<ul>
<li>The industry benchmark Liv-ex 100 index fell 1% in Q1 2024, a milder decline than the 4.2% dip at the end of last year.</li>
<li>Bond and equity markets rallied in anticipation of interest rate cuts by major central banks.</li>
<li>Over the past twenty years, the Liv-ex 1000’s most significant year-on-year dip was only 15%, less severe than that of major stock indices like the S&amp;P 500 (-45%).</li>
</ul>
After a challenging start to the year, the global economy is showing signs of resilience and potential growth. As we moved past the first quarter of 2024, both bond and equity markets rallied in anticipation of interest rate cuts by major central banks. Notably, sectors like the fine wine market are <a href="https://winecap.com/learn/how-could-2024s-interest-rates-impact-fine-wine/">expected to benefit from these shifts</a>, although the impact has not yet materialised.
<h2>The fine wine market in Q1 2024</h2>
The industry benchmark, Liv-ex 100 index, saw a modest decline of 1% in Q1 2024, an improvement from the 4.2% dip observed at the end of the previous year. This index experienced a slight drop of 0.3% in January and 1.1% in February but recovered in March with a 0.4% increase, marking its first rise in twelve months. Influential movers included Promontory and Dominus from Napa Valley, Super Tuscan Sassicaia, and Clos des Papes Châteauneuf-du-Pape. Despite this recovery, the fine wine market&#8217;s performance still lags behind mainstream financial markets.
<h2>Comparing mainstream markets</h2>
Mainstream indices such as the Nikkei 225 and the S&amp;P 500 have shown remarkable strength over the past year. Their annual growth from March 2023 to March 2024 ranks in the top 10% of year-on-year periods this century.
However, bond and equity markets experienced heightened volatility at the beginning of the year, due to geopolitical risks like the Middle East conflict and ongoing uncertainty around interest rates. This confluence of factors boosted the safe-haven asset Gold which has extended its run on <a href="https://www.reuters.com/markets/commodities/gold-hovers-near-record-high-market-focus-turns-us-data-fed-minutes-2024-04-09/">buying momentum</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1973" src="https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-375x201.png" alt="Liv-ex 100 vs mainstream markets and Gold" width="800" height="430" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-375x201.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-768x412.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-1536x825.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-2048x1100.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-1200x644.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1-1980x1063.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>A decade of the Liv-ex 1000 index</h2>
Celebrating ten years since its official launch in January 2014, the Liv-ex 1000 index provides two decades of insight into fine wine prices, encompassing a wide range of regions including Bordeaux, Burgundy, Champagne, the Rhône, Italy, and the rest of the world (Spain, Portugal, the USA, and Australia).
Over the past twenty years, while the Liv-ex 1000 has seen 64 year-on-year declines, its most significant drop was only 15%, considerably less severe than that of major stock indices like the S&amp;P 500, which once fell by 45%.
On the upside, the Liv-ex 1000&#8217;s best annual performance showed gains of 38%, comparable to those of major indices like the FTSE 100 and the Dow Jones, and its average growth rate of 8.4% is higher than many mainstream markets, only trailing behind the S&amp;P 500.
<img loading="lazy" decoding="async" class="alignnone wp-image-1974" src="https://wp.winecap.com/wp-content/uploads/2024/04/Performance-of-different-indices-375x120.png" alt="Liv-ex 1000 vs mainstream markets" width="800" height="256" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Performance-of-different-indices-375x120.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Performance-of-different-indices-768x245.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Performance-of-different-indices.png 1130w" sizes="(max-width: 800px) 100vw, 800px" />
As the global markets navigate through turbulent waters, the nuanced performance of the fine wine sector, detailed in our comprehensive Q1 2024 report, continues to offer valuable perspectives on both the challenges and opportunities that lie ahead.
Stay tuned for the full report later this week. 
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Fine wine market trends amid economic shifts in Q1 2024

<ul>
<li>The average First Growth case price is £5,300, while second wines come in at £1,941.</li>
<li>Le Clarence de Haut-Brion is the most affordable second wine.</li>
<li>Le Petit Mouton has been the best performer over the last decade.</li>
</ul>
Following our <a href="https://winecap.com/news/which-bordeaux-first-growth-has-the-lowest-price-per-point">article last week</a>, which examined the performance and value of the Bordeaux First Growths, we take a look at the data behind their second wines.
<h2>What are second wines?</h2>
Most Bordeaux châteaux produce more than one wine each vintage, and some might make three or four. Each château’s second wine draws on the expertise and knowledge that goes into the Grand Vin. Generally, second wines are made with fruit from younger vines, or vines and parcels that are not quite up to the quality of the Grand Vin in any given year.
However, they are often produced using grapes from the same vineyards as the flagship wines, receiving the same technical treatment in both vineyard and winery. Considerably less expensive than their siblings,  second wines represent a particularly attractive and accessible option for investors.
<h2>Second wines – at what price?</h2>
<img loading="lazy" decoding="async" class="alignnone wp-image-1964" src="https://wp.winecap.com/wp-content/uploads/2024/04/SW-POP-table-375x94.png" alt="Second wines prices and scores" width="800" height="199" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/SW-POP-table-375x94.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-POP-table-768x192.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-POP-table.png 1191w" sizes="(max-width: 800px) 100vw, 800px" />
White the average First Growth case price is £5,300, second wines come in at less than half the price (£1,941).
Interestingly, prices of the first and the second wine are not always rising in unison. For instance, Château Latour is the second most expensive Grand Vin after Château Lafite Rothschild. <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-latour/forts-latour">Les Forts de Latour</a>, however, sits directly in the middle, with <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/petit-mouton">Le Petit Mouton</a> and <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/carruades-lafite">Carruades de Lafite</a> being pricier.
When it comes to value for money, Le Clarence de Haut-Brion has the lowest price per point of £16, similar to its Grand Vin. As examined last week, Château Haut-Brion is the most affordable of the First Growths, while also boasting the highest average Wine Track score. Yet while Le Clarence is also the most affordable of the second wines, its Wine Track score is lower.
But looking purely at scores is not the best indicator of value when it comes to the second wines. Second wines differ from the Grand Vins, as the dominant relationship is between price and age, not price and quality. As time passes, their value rises, following the traditional wine investment dynamic.
Moreover, this group of wines is often bought by collectors and investors as they present access to a brand. Though suitable for aging, these wines are built for earlier consumption, offering an alternative to opening bottles of the Grand Vin as soon as they are delivered.
<h2>Performance of the second wines</h2>
In the last decade, Le Petit Mouton de Mouton Rothschild has been the best-performing second wine, up 111.9%.
The most affordable, Le Clarence de Haut-Brion, has delivered the second-best returns of 76.2%. It has been followed by Carruades de Lafite (64.7%) and <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-margaux/pavillon-rouge">Pavillon Rouge</a> (63.1%).
<img loading="lazy" decoding="async" class="alignnone wp-image-1966" src="https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-375x254.png" alt="Second wines performance" width="800" height="542" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-375x254.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-768x520.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-1536x1040.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-2048x1387.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-1200x813.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/SW-performance-1-1980x1341.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Finding value in the Bordeaux second wines

The following article is an extract from our <a href="https://winecap.com/learn/burgundy-regional-report">Burgundy regional wine investment report</a>.
<ul>
<li>Burgundy is the region with the highest average bottle prices.</li>
<li>It is the best-performing fine wine region, considerably outperforming industry benchmarks. </li>
<li>This article analyses its historic performance, the drivers behind its success, and what this might meant for the future of the region.</li>
</ul>
Burgundy has earned an impressive reputation in the fine wine investment landscape. The region is the outright leader when it comes to average bottle prices and the long-term performance of its wines.
The Burgundy 150 index, which tracks the prices of the last ten vintages across 15 Burgundy brands, is the leading Liv-ex regional index, continually outperforming Bordeaux, Italy and Champagne. It is up over 650% since its inception.
Although the index only comprises a narrow pool of highly traded wines, it provides an indication of the direction of Burgundy prices. During its impressive rise, the index experienced only one significant drop of 15%, giving investors confidence that its punctuated equilibrium will continue.
<img loading="lazy" decoding="async" class="alignnone wp-image-1958" src="https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-375x230.png" width="800" height="490" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-375x230.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-768x470.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-1536x940.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-2048x1254.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-1200x735.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/Liv-ex-100-and-Liv-ex-1000-vs-Burgundy-150-1980x1212.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Historic performance of Burgundy prices</h2>
The Liv-ex Burgundy 150 index doubled from early 2006 to mid/late 2008 — the first awakening of the Burgundy market as a new generation of wealthy consumers started to dominate the collectors’ market. This was at least in part driven by the volume of information available to them online from reviewers like Robert Parker and Allen Meadows and a greater focus on fine wine from the major auction houses.
After the 2008 financial crisis, Burgundy was somewhat left in the shadow. With the opening of the Chinese market, Bordeaux grew massively between 2008 and 2011. When Bordeaux fell from its 2011 peak, a new generation of investors flocked to Burgundy, seeking growth and breadth to their holdings.
From 2016 to late-2018, the value of the Burgundy 150 index doubled again. This can be attributed to growing liquidity in the sector and its recognition as a viable high-return investment. The region experienced a period of decline in 2019/2020, after a 15-year period without any significant downward movements. Some of this retreat has been related to profit taking and, later on, to the Covid-19 pandemic. Burgundy quickly made up for lost time in 2021 and 2022, with factors such as increased at-home consumption of fine wine, growing online trade, and rising liquidity contributing to its success. The index hit an all-time high in October 2022 at 909.4.
The market at large experienced another period of contraction in 2023, due to a combination of macroeconomic factors such as geopolitical conflicts, the lasting effects of the pandemic, high inflation and rising interest rates. Burgundy was the hardest hit region.
However, the overall direction of prices remains upwards as the trendline in the chart below shows. Such periods are advantageous times for Burgundy buyers who are usually able to find more stock at lower prices.
<img loading="lazy" decoding="async" class="alignnone wp-image-1959" src="https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-375x243.png" alt="Burgundy 150 and price trendlines" width="800" height="519" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-375x243.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-768x498.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-1536x996.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-2048x1328.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-1200x778.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/Burgundy-150-and-price-trendline-1980x1284.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
To find out more about the investment market for Burgundy wines, <a href="https://winecap.com/learn/burgundy-regional-report">read the full report here</a>.

History of Burgundy’s price performance

<ul>
<li>The price-per-point metric allows for a comparison of wines based on their market price and perceived quality.</li>
<li>This article examines the prices per point of the most liquid group of wines – the Bordeaux First Growths.</li>
<li>It also looks at their historic market performances.</li>
</ul>
Price per point is an indicator of value; it is calculated by dividing the average case price of a given wine by its average critic score. For some wines, prices and points line up. Typically, a 100-point wine will cost more than a 95-point one, though not always. The price-per-point metric allows for a comparison of wines based on both their market price and perceived quality, offering a nuanced view of their value.
Today we examine the price-per-point ratios of the most liquid and popular group of wines – the Bordeaux First Growths. Which Grand Vin has the lowest price per point and thus offers the best value as a brand?
<h2>First Growths – price per point</h2>
An average case price of £4,429 makes <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-haut-brion/haut-brion">Château Haut-Brion</a> the most affordable of the First Growths. Meanwhile, it has the highest average <a href="https://winecap.com/wine-track">Wine Track score</a> of 95.9 points. While there is divergence in prices and scores on a vintage-specific level, Château Haut-Brion has the lowest price per point among the First Growths overall.
<img loading="lazy" decoding="async" class="alignnone wp-image-1952" src="https://wp.winecap.com/wp-content/uploads/2024/04/Table-375x106.png" alt="First Growths average prices and scores" width="800" height="227" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Table-375x106.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Table-768x218.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Table.png 1120w" sizes="(max-width: 800px) 100vw, 800px" />
At the other end of the spectrum, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/lafite-rothschild">Château Lafite Rothschild</a> has the highest price per point of £64, owing to the highest average case price of £6,129 and a Wine Track score of 95.8.
<h2>What does this mean for the wines’ performance?</h2>
Historically, the First Growths have followed a similar trajectory of highs and lows. They all peaked during the China-led bull market (H1 2011) and experienced a subsequent downfall. Prices started to rise again following the Brexit referendum and have since largely maintained their level. They have fallen in the last year in line with the broader market (the <a href="https://www.liv-ex.com/news-insights/indices/">Liv-ex 50</a> which tracks the First Growths is down 15.3% over one year – the same as the broadest measure, the Liv-ex 1000 index).
<img loading="lazy" decoding="async" class="alignnone wp-image-1953" src="https://wp.winecap.com/wp-content/uploads/2024/04/Chart-375x254.png" alt="First Growths performance" width="800" height="542" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Chart-375x254.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-768x520.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1536x1040.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-2048x1387.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1200x813.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/Chart-1980x1341.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
Of the five First Growths, Lafite has risen the most, with our index peaking in February 2011. Recently, however, it has been the biggest faller, dipping 19% in the last year. Haut-Brion, which has been a more modest performer without delivering the same heights, has dipped the least of the First Growths (10%) during the same period. With a more stable market performance, Haut-Brion offers further opportunities for investors and collectors where the price per point remains comparatively low.
<h2>Wines that offer value perform the best</h2>
In the case of Haut-Brion, value plays an important role in market performance. POP wines (those with a lower price per point) have outperformed the rest over 15 years. These include vintages 2002, 2004, 2006, 2007, 2008, 2011, 2012, 2013, 2014, 2017 and 2019 (the only prime vintage among the POP wines).
The second-best-performing index comprises older ‘prime’ vintages – wines with high scores pre-2000. However, this index has shown higher volatility due to the limited availability and trading volumes of these wines.
The index comprising younger ‘on’ vintages like 2015, 2016, 2018 and 2020 has underperformed the rest of the pack. However, these wines have also had less time in the market and their evolution is yet to be seen.
<img loading="lazy" decoding="async" class="alignnone wp-image-1954" src="https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-375x254.png" alt="Haut-Brion vintage performance" width="800" height="542" srcset="https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-375x254.png 375w, https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-768x520.png 768w, https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-1536x1040.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-2048x1387.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-1200x813.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/04/Haut-Brion-vintage-performance-1980x1341.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
In conclusion, looking at price per point gives an indication of value and quality. However, historic market performance is telling for investors looking for stability or higher risk and potentially higher rewards.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Which Bordeaux First Growth has the lowest price per point?

<ul>
<li>Champagne has enjoyed rising popularity as an investment in recent years, which has been reflected in its price performance.</li>
<li>The Liv-ex Champagne 50 index has considerably outperformed industry benchmarks.</li>
<li>While quality is important, brands and age are the most significant drivers behind its performance.</li>
</ul>
Champagne has enjoyed rising popularity as an investment in recent years, which has been reflected in its price performance. The Liv-ex Champagne 50 index, which tracks some of the most sought-after wines including Krug Vintage Brut, Bollinger La Grande Année, Dom Pérignon, Louis Roederer Cristal, and Taittinger Comtes de Champagne among others, has significantly outperformed global benchmarks. Over the last decade, the Champagne 50 index is up 108.9%, compared to 41.4% for the Liv-ex 100 and 64.3% for the broader Liv-ex 1000 index.
These numbers clearly demonstrate that Champagne is a smart addition to any diversified investment portfolio and should no longer be considered just a celebratory indulgence.
<h2>Champagne’s price performance</h2>
Much of Champagne’s remarkable performance happened between mid-2020 and the end of 2022, when the index appreciated 90.9% (May 2020 – October 2022). This period was marked by great uncertainty, from the Covid-19 pandemic, through war in Ukraine, rising inflation and recession. As the ultimate ‘luxury good’ in the fine wine market, Champagne performed particularly well and its rising prices did little to temper demand.
Since then, prices have calmed but demand remains strong. Champagne dominated the list of the top-traded wines on <a href="https://www.liv-ex.com/">Liv-ex</a> in 2023, with Louis Roederer Cristal 2015 leading the value rankings, and Dom Pérignon 2013 – by volume.
<img loading="lazy" decoding="async" class="alignnone wp-image-1948" src="https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-375x249.png" alt="Champagne vs fine wine indices" width="800" height="532" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-375x249.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-768x510.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-1536x1021.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-2048x1361.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-1200x797.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/03/Champagne-1980x1316.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Supply and demand dynamics</h2>
Demand for Champagne has led to increases in its overall production from 50 million bottles in the 1970s to over 300 million today. Of these, Moët &amp; Chandon contributes over 30 million bottles per year, making it the world&#8217;s largest Champagne producer.
Despite relatively healthy production volumes, the availability of vintage Champagne is limited (due to its staggering consumption market, which includes hospitality and entertainment industry buyers). This further enhances its desirability as an investment.
As it ages, its quality improves; as it is consumed, its supply decreases. This dynamic brings about an inverse supply curve – the ideal scenario for investors.
Smaller initial costs are another positive, as Champagne offers both new and experienced investors relative affordability. Although prices have moved considerably in recent years, the average case of top Champagne costs less than a case of the top wines of Bordeaux, Burgundy, California or Italy. Meanwhile, the region offers better returns.
<h2>What makes Champagne investment unique</h2>
The fine wine market has long been influenced by major critics. While critics do play a part in the evolution of Champagne prices, brands and age have proven to be more significant performance drivers.
Champagne houses that have an established and historically proven identity are already ahead of the game; however, endorsements from sources such as royal weddings, celebrities and high-visibility restaurants have paved the way for emerging cuvées.
Champagne is a more direct market than ones like Bordeaux as there are no négociants; the structure in Champagne is such that over 90% of producers are now also distributors.
Thanks to its artisanal qualities, ‘grower Champagne’ is a newly expanding sector (small estates where the brand identity is centred around the vigneron themselves). Leading this group are the likes of Jacques Selosse, Egly-Ouriet and Ulysse Collin.
An added benefit to Champagne’s appeal is its drinkability. If an investor simply cannot resist popping the cork, Champagne can be readily consumed much earlier than premium investment wines, further diminishing supply and driving prices up.
To find out more about the investment market for Champagne, <a href="https://winecap.com/learn/champagne-report">read the full report here</a>.

Inside Champagne’s wine investment market

<ul>
<li>Neal Martin recently reviewed Bordeaux 2014 ten years on.</li>
<li>The critic noted that many of the wines have evolved faster than expected.</li>
<li>He declared it a Left Bank vintage and gave his highest score to Mouton Rothschild.</li>
</ul>
<a href="https://vinous.com/articles/test-of-endurance-bordeaux-2014-ten-years-on-mar-2024">Vinous</a> recently published Neal Martin’s assessment of Bordeaux 2014 following two consecutive tastings, including the annual Southwold 10-years-on event.
Martin’s overall impression was that the wines were ‘more unpredictable than other vintages’, and ones to ‘approach with modest expectations’. For him, many of them deserve drinking in the near future, but some are yet to deliver more.
On the question of Left vs Right Bank, the critic noted that the Left Bank has proven to be more consistent. When it comes to best-performing appellations, his pick was Saint-Julien.
<h2>Bordeaux 2014 ageing potential</h2>
Ten years on, the 2014 vintage has ‘evolved faster than envisaged’, according to Martin. The critic said that ‘it twinkled brightly in its youth, but many of its alumni were not predisposed toward longevity’. He further noted that ‘it certainly lacks the legs of, say, 2010 or 2016, perhaps even 2012 or 2017’.
Martin singled out wines that still have a life ahead of them and will be ‘intriguing to revisit at 15 years’, including Léoville Poyferré, Mouton Rothschild, Lafleur and Grand-Puy-Lacoste.
<h2>Favourite wines</h2>
For Martin, the wines that have ‘much more to offer’ and sit ‘up the hierarchy’ were Cheval Blanc, Figeac, Ausone and Pavie. ‘L’Eglise-Clinet, Lafleur and in particular, Vieux Château Certan, excel over in Pomerol, likewise Petrus and Clos l’Eglise,’ the critic added.
However, he warned that ‘none of the aforementioned ranks among their best wines’.
A personal favourite from Pessac-Léognan was Domaine de Chevalier. He also liked Pape-Clément and Haut-Bailly. His top-scoring wines can be seen in the table below.
<img loading="lazy" decoding="async" class="alignnone wp-image-1943" src="https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-NM-375x150.png" alt="Neal Martin's top-scoring Bordeaux 2014 wines" width="800" height="320" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-NM-375x150.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-NM-768x307.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-NM.png 1006w" sizes="(max-width: 800px) 100vw, 800px" />
Mouton Rothschild received the highest score of 97 points. Martin argued that it was ‘contender for wine of the vintage’ and ‘one of a handful of wines that transcends the limitations of the season, partly due to the skills of former winemaker Philippe Dhalluin’.
The critic also said that ‘the 2014 Grand-Puy-Lacoste is outstanding and performed neck-and-neck with the First Growths’.
<h2>Bordeaux 2014 – performance since release</h2>
While the vintage may not sit up with the very best like 2010 or 2016, many of the wines offer relative value and a lower-than-average entry point into Bordeaux’s top brands.
Moreover, some have delivered handsome returns since release. Beyond the obvious performers of <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/carruades-lafite">Carruades de Lafite</a> (208.3%) and <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/petit-mouton">Petit Mouton</a> (173.1%) and wines like <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-figeac/figeac">Figeac</a> (164.5%) which have benefited from changing classification, there is considerable growth to be found in some 2014s. For instance, <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-beychevelle/beychevelle">Beychevelle</a> has risen 165.4%, <a href="https://winecap.com/wine-track/france/bordeaux/saint-estephe/chateau-calon-segur/calon-segur">Calon Ségur</a> – 113.4%, <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-la-conseillante/conseillante">La Conseillante</a> – 93.0%, and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-canon-la-gaffeliere/canon-gaffeliere">Canon-La Gaffelière</a> – 80.3%. To see overall brand performances, visit <a href="https://winecap.com/wine-track">Wine Track</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1944" src="https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-375x238.png" alt="Bordeaux 2014 performance since release" width="800" height="508" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-375x238.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-768x488.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-1536x975.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-2048x1300.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-1200x762.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/03/Bdx-14-wines-performance-1980x1257.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Ten years on: Neal Martin reviews Bordeaux 2014

The following article is an extract from our <a href="https://winecap.com/learn/united-states-regional-report">USA regional wine investment report</a>. 
<ul>
<li>Today, the USA is one of the key fine wine investment regions.</li>
<li>Its share of secondary market trade has risen from 0.1% in 2010 to around 8% this year.</li>
<li>Demand has been stimulated by a string of good vintages in the past decade, high critic scores, and expanding distribution.</li>
</ul>
Today, the USA is one of the key fine wine investment regions. Its share of secondary market trade has risen from 0.1% in 2010 to about 8% this year, and an increasing number of previously overlooked wineries are now showing investment-worthy returns.
<h2>Inside the USA’s investment market</h2>
California has long been the driver behind the USA’s ever-growing presence in the fine wine investment landscape, accounting for roughly 99% of the country’s secondary market trade. Buying demand has been largely UK and US-driven and centred around the top names: <a href="https://winecap.com/wine-track/united-states/california/oakville/screaming-eagle/cabernet-sauvignon">Screaming Eagle</a>, <a href="https://winecap.com/wine-track/united-states/california/napa-valley/opus-one/opus-one">Opus One</a>, <a href="https://winecap.com/wine-track/united-states/california/napa-valley/dominus/dominus">Dominus</a>, <a href="https://winecap.com/wine-track/united-states/california/napa-valley/harlan-estate/harlan-estate">Harlan Estate</a>, <a href="https://winecap.com/wine-track/united-states/california/napa-valley/promontory/promontory">Promontory</a>, and <a href="https://winecap.com/wine-track/united-states/california/rutherford/scarecrow/cabernet-sauvignon">Scarecrow</a>.
<h2>Price differentials</h2>
California is the second-most-expensive fine wine region after Burgundy, based on the average price of its leading estates. However, there are big differences in pricing between the region’s top names.
At the time of writing, the average case price of <a href="https://winecap.com/wine-track/united-states/california/oakville/screaming-eagle/cabernet-sauvignon">Screaming Eagle Cabernet Sauvignon</a> is £39,117, compared to £7,399 for <a href="https://winecap.com/wine-track/united-states/california/napa-valley/promontory/promontory">Promontory</a>, £3,764 for <a href="https://winecap.com/wine-track/united-states/california/napa-valley/opus-one/opus-one">Opus One</a>, £2,773 for <a href="https://winecap.com/wine-track/united-states/california/napa-valley/dominus/dominus">Dominus</a>, and £2,719 for <a href="https://winecap.com/wine-track/united-states/california/santa-cruz-mountains/ridge/monte-bello">Ridge Monte Bello</a>. To explore average trade prices, visit our indexing tool <a href="https://winecap.com/wine-track/">Wine Track</a>.
<h2>Price performance</h2>
Prices for Californian fine wines have risen slowly and steadily. Over the last 15 years, the Liv-ex California 50 index which tracks the price movements of the last 10 physical vintages across five of the most traded brands (Dominus, Opus One, Harlan, Ridge, and Screaming Eagle) has outperformed both the Liv-ex 100 and Liv-ex 1000 indices. The California 50 is up 166.2%, compared to 71.6% for the Liv-ex 100 and 116.6% for the Liv-ex 1000. Moreover, over the long and short term, California has fared better than Bordeaux as an investment, yielding higher returns.
<h2>The best brands for investment</h2>
Among the most popular labels, <a href="https://winecap.com/wine-track/united-states/california/santa-cruz-mountains/ridge/monte-bello">Ridge Monte Bello</a> has been the best-performing Californian wine, up 121.9% in the last decade. It has been followed by Screaming Eagle Cabernet Sauvignon with a 103.3% rise and Harlan, up 91.1%. All the wines in the chart below have risen over 80% in the last decade.
<img loading="lazy" decoding="async" class="alignnone wp-image-1939" src="https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-375x239.png" alt="US wines performance
" width="800" height="510" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-375x239.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-768x490.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-1536x980.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-2048x1307.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-1200x766.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/03/US-wines-1980x1263.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
However, other producers beyond the most traded names have also been making waves. <a href="https://winecap.com/wine-track/united-states/california/napa-valley/caymus/cabernet-sauvignon">Caymus Cabernet Sauvignon</a> has risen an impressive 154.8%, while <a href="https://winecap.com/wine-track/united-states/california/howell-mountain/dunn/howell-mountain-cabernet-sauvignon">Dunn Howell Mountain Cabernet Sauvignon</a> is up 137.5% in the last decade. This data suggests that there is a significant number of American wines beyond the most popular names that can deliver healthy investment returns.
<h2>California: A 100-point region</h2>
Price performance has been influenced by ‘cult’ status and vintage quality. California regularly tops critic rankings as the region with the most 100-point wines. Relatively consistent climate has led to less vintage variation than in other dominant fine-wine producing regions. Major critic publications like <a href="https://www.robertparker.com/">Wine Advocate</a> and <a href="https://www.wineenthusiast.com/">Wine Enthusiast</a> highlight 2001, 2007, 2012, 2013, 2015, 2016, 2018, 2019, and 2021 as particularly good.
To find out more about the investment market for US wines, <a href="https://winecap.com/learn/united-states-regional-report">read the full report here</a>.

Inside the USA’s wine investment market

<ul>
<li>Green shoots are starting to appear in the fine wine market after a year of consistent declines.</li>
<li>On a regional level, prices for Champagne and Italian wine rose last month.</li>
<li>We highlight individual brands that have shown positive performances over the last three months.</li>
</ul>
<a href="https://www.investopedia.com/terms/g/green-shoots.asp">Green shoots</a> are starting to appear in the fine wine market after a year of consistent declines. The industry benchmark, the <a href="https://www.liv-ex.com/">Liv-ex 100 index</a>, has been on a freefall since March 2023, dipping 14.6% during this time. Meanwhile, the broader Liv-ex 1000 index has fallen 15.3%.
But the market is now showing modest signs of recovery. In February, the Champagne 50 index rose for the first time in 18 months (1% MoM). The Italy 100 index also went up in December last year, and again in February amid a <a href="https://winecap.com/news/italian-wine-enjoys-demand-amid-new-releases">flurry of new releases</a>.
Green shoots generally refer to signs of growth during a downturn. These are especially visible in regional performances.
<img loading="lazy" decoding="async" class="alignnone wp-image-1934" src="https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-375x254.png" width="800" height="542" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-375x254.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-768x520.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-1536x1040.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-2048x1387.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-1200x813.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/03/LX-indices-chart-1980x1341.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
Looking at individual wines, there are more reasons for cautious optimism. Leading brands from Bordeaux, Champagne, Burgundy, Tuscany and Piedmont have been trending upward over the last three months.
<h2>Champagne bounces back</h2>
For instance, a number of Champagnes have risen between 2% and 7% since the end of last year, including <a href="https://winecap.com/wine-track/france/champagne/na/dom-perignon/dom-perignon-rose">Dom Pérignon</a> (2%), <a href="https://winecap.com/wine-track/france/champagne/le-mesnil-sur-oger/salon/le-mesnil">Salon Le Mesnil-sur-Oger Grand Cru</a> (4%), <a href="https://winecap.com/wine-track/france/champagne/na/pol-roger/brut-vintage">Pol Roger</a> (6%) and <a href="https://winecap.com/wine-track/france/champagne/na/veuve-clicquot/la-grande-dame-rose">Veuve Clicquot La Grande Dame Rosé</a> (7%). By contrast, many of these wines were on a downward trend <a href="https://winecap.com/news/investment-opportunities-in-lvmh-champagnes">six months ago</a>. Although they have made only small gains, it looks as if tables have started to turn.
<h2>Italy’s resilient performance</h2>
This theme can also be observed in Italy. From Tuscany, <a href="https://winecap.com/wine-track/italy/tuscany/bolgheri/ornellaia/ornellaia">Ornellaia</a> has risen 3% in the last three months, while <a href="https://winecap.com/wine-track/italy/tuscany/bolgheri/antinori/guado-al-tasso">Antinori’s Guado Al Tasso</a> is up 2%. Even bigger moves have been made by some Piedmont brands, like <a href="https://winecap.com/wine-track/italy/piedmont/barbaresco/produttori-del-barbaresco/barbaresco-montestefano-riserva">Produttori del Barbaresco Montestefano Riserva</a> up 7%. <a href="https://winecap.com/wine-track/italy/piedmont/barolo/comm.-g.b.-burlotto/barolo">Comm. G.B. Burlotto Barolo</a> and <a href="https://winecap.com/wine-track/italy/piedmont/barolo/vietti/barolo-brunate">Vietti Barolo Brunate</a> have increased by 3% and 2% respectively. As examined last week, recent <a href="https://winecap.com/news/italian-wine-enjoys-demand-amid-new-releases">high-quality Italian releases</a> have stimulated demand and secondary market activity for the region.
<h2>Bordeaux and the search for value</h2>
In Bordeaux, value has proven to be key. Popular wines beyond the First Growths and the top names have enjoyed price appreciation. These include <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-malescot-st.-exupery/malescot-st-exupery">Château Malescot St. Exupéry</a> (3%), <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-gruaud-larose/gruaud-larose">Château Gruaud Larose</a> (2%) and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-la-gaffeliere/gaffeliere">Château La Gaffelière </a> (2%). The average case price of these wines comfortably sits below £750.
<h2>Burgundy’s return to stability</h2>
Burgundy, which has fallen the most of all regions, also seems to be making a comeback with some high-flyers. Among them are <a href="https://winecap.com/wine-track/france/burgundy/gevrey-chambertin/domaine-faiveley/gevrey-chambertin-vv">Domaine Faiveley Gevrey-Chambertin Vieilles Vignes</a> (12%) and <a href="https://winecap.com/wine-track/france/burgundy/vosne-romanee/maison-louis-jadot/vosne-romanee-beaumonts">Maison Louis Jadot Vosne Romanée Premier Cru Les Beaux Monts</a> (7%).
While the general theme of the market continues to be one full of buying opportunities at cheaper-than-average prices, recent signs of growth suggest that a slow and steady recovery might soon be underway for some regions.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Green shoots in the fine wine market

<ul>
<li>Buying demand for fine wine is impacted by the global economy, where currency volatility plays a significant role.</li>
<li>Fine wine indices are frequently quoted in sterling (GBP), making the currency&#8217;s strength or weakness a pivotal factor affecting both domestic and international transactions.</li>
<li>A stronger pound makes UK-sourced fine wines more expensive for foreign buyers, potentially dampening demand and leading to falls in the indices.</li>
</ul>
Although uncorrelated to mainstream markets, the fine wine market does not exist in a vacuum. Buying demand and investment interest are impacted by the global economy, where currency volatility plays a significant role.
For investors, understanding the impact of currency movements, especially in a market where prices and indices are often denominated in sterling, is crucial. Here&#8217;s how currency volatility influences the fine wine market and strategies investors can employ to navigate these turbulent waters.
<h2>The impact of currency volatility</h2>
Currency volatility refers to the fluctuations in the value of one currency relative to another. For the fine wine market, which is global, these fluctuations can have a pronounced impact. Prices and indices for fine wine are frequently quoted in sterling (GBP), making the British currency&#8217;s strength or weakness a pivotal factor affecting both domestic and international transactions.
When the pound weakens against major currencies like the dollar or euro, fine wine prices in the UK become more attractive to foreign buyers. This increased demand from abroad can drive up prices, as buyers look to capitalise on favourable exchange rates to purchase high-quality wines at lower relative costs. Conversely, when the pound strengthens, as is the case currently, fine wine prices can seem more expensive to foreign buyers, potentially leading to a decrease in international demand and a stabilisation or even fall in the indices that track them.
<h2>Real-world implications</h2>
Consider the aftermath of the Brexit referendum in June 2016, when the pound experienced a significant drop against the dollar and euro. This scenario offered a golden opportunity for foreign investors, particularly from the US and Asia, who found that their purchasing power had increased overnight. As a result, demand for fine wines priced in sterling surged, driving up fine wine prices.
The Liv-ex Fine Wine 1000 Index, which is the broadest measure of the market and tracks the price movement of 1000 of the most sought-after fine wines, showed upward price movement of 14% in the six months following the referendum. Its rise in sterling was uninterrupted until August 2017. In just over a year, the index rose 21.7%.
This trend was largely fuelled by foreign investors taking advantage of the weaker pound to expand their collections.
<h2>Sterling&#8217;s strength and its effects</h2>
On the flip side, periods of sterling strength present a different picture. A stronger pound makes UK-sourced fine wines more expensive for foreign buyers, potentially dampening demand. This has contributed to a fall in the Liv-ex 1000 index, denominated in sterling. However, when seen in other currencies, the fall in fine wine prices is less sharp.
<img loading="lazy" decoding="async" class="alignnone wp-image-1930" src="https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-375x246.png" alt="Liv-ex 1000 index in different currencies" width="800" height="525" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-375x246.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-768x504.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-1536x1008.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-2048x1343.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-1200x787.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/03/LX1000-1980x1299.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
The Liv-ex 1000 index peaked in October 2022 in sterling; since then, the index has dipped 17.5%.
But the losses since its peak have been smaller in alternative currencies. The index hit its highest point in euro in June 2022 and has fallen 16.4% since. In US dollar, the index peaked in March 2023; since then, it has fallen 14%. In Japanese Yen, the Liv-ex 1000 peaked in May 2023 and has fallen 10% since.
<h2>A global market with local prices</h2>
While fine wine prices may be quoted in sterling, the global nature of the market means that prices inherently hold their value in alternative currencies. This resilience is partly because the value of fine wine is not solely dependent on currency movements but also on factors such as vintage quality, brand reputation, and scarcity.
For instance, a classic Bordeaux vintage will maintain its allure and value to collectors worldwide, regardless of short-term currency fluctuations. This universal appeal ensures that while prices in sterling may rise or fall with the pound&#8217;s strength, the intrinsic value of fine wines remains recognised across currencies.
<h2>Strategies for investors</h2>
Investors can leverage currency volatility to their advantage by staying informed about global economic trends and currency forecasts. Purchasing fine wines when the pound is weak can offer significant value, while selling during periods of sterling strength may maximize returns.
Currency volatility is a double-edged sword in the fine wine market, presenting both opportunities and challenges. Whether taking advantage of a weaker pound to acquire coveted wines or diversifying investments to mitigate risks, the key lies in informed decision-making and a keen eye on the ever-changing economic landscape.
Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

Navigating currency volatility in the fine wine market

<ul>
<li>New releases from Italy have led to increased secondary market activity for the region. </li>
<li>Italian fine wine prices rose in February with some wines enjoying double-digit returns.</li>
<li>The 100-point Sassicaia 2021 has traded with a premium since its release last month.</li>
</ul>
Italian wine is currently in the spotlight amid a flurry of new releases, including the high-quality Brunello 2019 vintage and the 2021 vintage of the Super Tuscans Sassicaia and Ornellaia.
<h2>Brunello 2019 enters the market</h2>
The 2019 Brunello vintage is shaping up to be exceptional, potentially surpassing the subsequent vintages of 2020, 2021, and 2022, which were characterised by significantly higher temperatures. In terms of quality, critics have placed it on par with 2016, 2010 and 2006.
While Brunello may not dominate the fine wine market as prominently as the Super Tuscans, it has potential for attractive investment returns, especially from producers like Biondi Santi, Poggio di Sotto, and Casanova di Neri. These wines often come at more appealing price points compared to their counterparts.
For instance, <a href="https://winecap.com/wine-track/italy/tuscany/brunello-di-montalcino/biondi-santi/brunello-montalcino">Biondi Santi Brunello di Montalcino</a> has risen 73% in value over the last five years, outperforming the likes of <a href="https://winecap.com/wine-track/italy/tuscany/bolgheri/tenuta-san-guido/sassicaia">Sassicaia</a> and <a href="https://winecap.com/wine-track/italy/tuscany/toscana/masseto/masseto">Masseto</a>. <a href="https://winecap.com/wine-track/italy/tuscany/brunello-di-montalcino/poggio-di-sotto/brunello-montalcino">Poggio di Sotto</a>’s performance has been equally impressive, rising 187% in the last decade, while <a href="https://winecap.com/wine-track/italy/tuscany/brunello-di-montalcino/casanova-di-neri/brunello-montalcino-tenuta-nuova">Casanova di Neri Tenuta Nuova</a> has been up 126%. At the top end, the more expensive and highly sought-after <a href="https://winecap.com/wine-track/italy/tuscany/brunello-di-montalcino/soldera-casse-basse/brunello-montalcino-riserva">Soldera Casse Basse</a> has returned 237% over the same period.
The historic performance of these brands strengthens the case for buying in vintages where the quality is high, and where the releases offer relative value.
<h2>Super Tuscan releases</h2>
In the world of fine wine, the most talked about Italian releases have been Sassicaia and Ornellaia 2021.
Ornellaia 2021 was released at £1,850 per 12&#215;75, the same price as the 2020 release. At this price, the wine is the most expensive recent vintage on the market since 2016. Antonio Galloni (<a href="https://vinous.com/">Vinous</a>) awarded it 99-points and said that it ‘captures all the magic of this sensational vintage on the Tuscan Coast’. Meanwhile, Monica Larner (<a href="https://www.robertparker.com/wines/GAtNZdo8QwMfscgyx/bolgheri-superiore-ornellaia-2021">Wine Advocate</a>) gave it 96-points and described it as ‘a very open-knit and exuberant Tuscan red’.
<img loading="lazy" decoding="async" class="alignnone wp-image-1920" src="https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-1-375x196.jpg" alt="Ornellaia
" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-1.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
Sassicaia 2021 was released last month at £2,500 per case, up 4.2% on the 2020‘s release price. The wine has since traded at a premium on the secondary market. It received 100-points from Monica Larner who called it ‘a quintessential Sassicaia that represents the excellence of the vintage and also respects the unique taste profile of this distinguished Tuscan blend of Cabernets Sauvignon and Franc’. Galloni gave it 98+ points and noted that it was ‘one of the best young Sassicaias I can remember tasting’. ‘In a word: magnificent’, said the critic.
<img loading="lazy" decoding="async" class="alignnone wp-image-1921" src="https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-2-375x196.jpg" alt="Sassicaia" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-2-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-2-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2024/03/EP-Socials-LinkedInAll-2.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Italy gathers momentum</h2>
Recent releases have stimulated the secondary market for Italian wine. The region has been the best performing fine wine market segment over the last two years, as well as in the last few months. In February, the Liv-ex Italy 100 index posted a modest rise of 0.1%, but some vintages of <a href="https://winecap.com/wine-track/italy/tuscany/colli-della-toscana-centrale/fontodi/flaccianello-della-pieve">Fontodi Flaccianello delle Pieve Colli della Toscana Centrale</a>, <a href="https://winecap.com/wine-track/italy/tuscany/toscana/antinori/tignanello">Tignanello</a> and <a href="https://winecap.com/wine-track/italy/piedmont/barolo/giacomo-conterno/barolo-riserva-monfortino">Giacomo Conterno Barolo Monfortino Riserva</a> enjoyed double-digit returns.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Italian wine enjoys demand amid new releases

<ul>
<li>Storage is arguably the most important factor in preserving the quality of a fine wine and is thus fundamentally linked to its value as an investment. </li>
<li>A well-documented history of storage and ownership can significantly increase a wine&#8217;s value, serving as proof of its authenticity and condition.</li>
<li>Storing wine in-bond has multiple benefits, including deferred taxes, easier international trading and guaranteed provenance.</li>
</ul>
Wine storage has undergone significant transformation over the years, evolving from traditional cellars in private homes to sophisticated, climate-controlled facilities that cater to the needs of serious collectors and investors. The way wine is stored can greatly impact its quality, and by extension, its value as an investment.
<h2>Why is wine storage important</h2>
A large part of fine wine’s performance as an asset is down to its ability to improve as it ages. If the quality increases in time, so does its value.
Storage is arguably the most important factor in preserving the quality of a wine. If a bottle is stored improperly, the opposite can happen. Fluctuating temperatures, exposure to sunlight, vibrations and humidity can all degrade the quality of the wine and lead it to lose its value.
By storing your assets in professional dedicated wine storage facilities, you can guarantee that when the time comes to sell, it will be in the best possible condition. This will give the final consumer confidence that the wine is of the expected quality, defending its future value.
<h2>The evolution of wine storage solutions</h2>
Historically, wine storage was the domain of underground cellars, designed to provide the cool, stable temperatures and humidity levels that wine needs to age gracefully. These cellars, often part of private homes in wine-producing regions, set the standard for ideal wine storage conditions: darkness, consistent temperature around 12-14°C (55-57°F), and relative humidity around 60-70%.
In recent decades, technology has revolutionised wine storage. Climate-controlled wine cabinets and refrigeration units can replicate the conditions of a traditional cellar, making it possible to store wine in any environment. Innovations such as dual-zone temperature controls, UV-protected glass doors, and vibration reduction technology have further enhanced the ability to preserve wine at optimal conditions.
Moreover, professional wine storage facilities offer a level of sophistication and security beyond what most private cellars can provide. These facilities are equipped with state-of-the-art climate control systems, backup power sources to protect against outages, and high-security measures to guard against theft. They also offer inventory management services, ensuring that wines are stored properly and can be easily accessed or audited by their owners.
For investors, the use of such facilities can enhance the value of their collection, as provenance – the history of wine’s ownership and storage – becomes increasingly important in the secondary fine wine market.
<h2>The role of provenance in wine investment</h2>
Provenance is a critical factor in the wine investment market. A well-documented history of storage and ownership can significantly increase a wine&#8217;s value, serving as proof of its authenticity and condition. Professional storage facilities often provide detailed records that can be invaluable in establishing provenance, making wines stored in these conditions more desirable to collectors and investors alike.
In contrast, wines stored in private cellars may lack comprehensive records, potentially diminishing their market value, regardless of their quality or rarity.
<h2>In-bond storage</h2>
Bonded status is what unlocks the secondary market for fine wine.
Storing wine in-bond means that the wine is kept in a secure warehouse under government supervision without the payment of duty or tax. For wine investors, this presents a significant advantage, as it allows for the storage of wine without the financial burden of taxes until the wine is either sold or removed for personal consumption. Typically, wines can be stored in-bond at their point of entry into a country or transferred to a bonded warehouse specifically designated for wine storage. The wines stored in-bond are trade-ready; they sit within the secondary market ecosystem and can be made immediately available for sale and collection.
<h2>Implications for wine investment</h2>
The ability to store wine in-bond has several implications for investors.
Deferred taxes: Investors can defer tax payments, improving cash flow and reducing initial investment costs. This is particularly beneficial for wines intended for resale, as the duty and VAT (value-added tax) are only paid if and when the wine enters the domestic market.
International trading: In-bond storage facilitates easier trading of wine on an international scale. Wines can be bought and sold multiple times while still in-bond, without incurring tax liabilities until they are finally withdrawn for consumption. This can significantly enhance the liquidity of wine investments.
Provenance and condition: Bonded warehouses are not only secure but are also designed to provide optimal storage conditions, similar to professional wine storage facilities. The rigorous documentation and oversight in these warehouses ensure the provenance and condition of the wine, crucial factors in maintaining and enhancing its value.
Market value: Wines stored in-bond are often more attractive to buyers, especially in international markets. The assurance of proper storage conditions and the ease of transfer without immediate tax implications make these wines more desirable, potentially increasing their market value.
<h2>Storing wine with WineCap</h2>
WineCap use London City Bond’s newest storage facility, Drakelow. Three and a half miles of tunnels were blasted out of solid rock, as part of the lavish refurbishment of this former nuclear bunker, which started operating as a dedicated wine storage facility in 2023. Highly secure with entirely natural permanent temperature control supported by the latest dehumidification equipment, Drakelow is the natural choice for maturing reserves.
Every wine in our storage facility gets its own unique identification number (UIDS), thus ensuring that each case has clear ownership.
The practice of storing wine in-bond in bonded warehouses represents a critical aspect of the wine investment landscape. As the wine market continues to mature, the importance of professional storage and provenance documentation is likely to grow, influencing both the strategies of investors and the broader dynamics of wine collecting and investing. Whether opting for a meticulously maintained home cellar or entrusting a collection to a professional storage facility, understanding the impact of storage on wine&#8217;s quality and value is essential for any serious wine investor.
Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The importance of wine storage

<ul>
<li>Neal Martin said Bordeaux 2021 shouldn’t be dismissed and identified an ‘overachiever’ among the wines in this challenging vintage. </li>
<li>According to Antonio Galloni, the quality is higher on the Left Bank than on the Right Bank. </li>
<li>A dry white wine and a Sauternes were the critics’ top-scoring wines from the vintage.</li>
</ul>
Vinous recently published two separate Bordeaux 2021 in-bottle reports by <a href="https://vinous.com/articles/2-2-5-bordeaux-2021-in-bottle-feb-2024">Neal Martin</a> and <a href="https://vinous.com/articles/2021-bordeaux-l-enfant-terrible-feb-2024">Antonio Galloni</a>. In this article, we summarise their views on this polarising vintage.
<h2>Why Bordeaux 2021 should not be ignored</h2>
In his report, titled ‘2+2=5: Bordeaux 2021 In Bottle’, Neal Martin explained why ‘irrationality tastes good’ and why Bordeaux 2021 shouldn’t be ignored. He said that ‘on paper, a cursory glance at the troubled growing season would make any rational person dismiss its wines’. But the critic argued that they would be wrong.
While Martin awarded few wines more than 95 points, he advised readers against ‘thinking that the 2021 vintage is incapable of giving sensory and intellectual pleasure’.
According to him, advanced technology and refined winemaking made a fundamental difference at the top end, and thus 2021 cannot be compared ‘with off-vintages like 1977, 1992 or arguably even 2013’.
Martin singled out <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-les-carmes-haut-brion/carmes-haut-brion">Les Carmes Haut-Brion</a> as an ‘overachiever’ that ‘halts you in your tracks’ and noted that ‘there is a cluster of very strong-performing wines on the Left Bank that merit attention and possess the substance to repay cellaring’. He added that ‘the Right Bank matches the Left Bank, particularly the usual names on the Pomerol plateau […] and likewise those in Saint-Émilion on free-draining limestone soils’.
Similarly, Galloni found ‘a wide range of compelling wines that merit attention’ within the context of a challenging growing season.
‘In many ways, 2021 can be summarized as a year in which classic Bordeaux weather of the past meets the technical know-how of today in both the vineyard and winery,’ the critic argued.
Overall, he said, ‘the quality is higher and more consistent on the Left Bank over the Right Bank, even though at the very top, the best Right Bank wines can only be described as stellar’.
Galloni called <a href="https://winecap.com/wine-track/france/bordeaux/saint-estephe/chateau-calon-segur/calon-segur">Calon Ségur</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/ducru-beaucaillou/ducru-beaucaillou">Ducru-Beaucaillou</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/lafite-rothschild">Lafite Rothschild</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-pichon-longueville-comtesse-de-lalande/pichon-lalande">Pichon-Comtesse</a> and <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-rauzan-segla/rauzan-segla">Rauzan-Ségla</a> ‘magnificent’, <a href="https://www.google.com/url?q=https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-les-carmes-haut-brion/carmes-haut-brion&amp;sa=D&amp;source=docs&amp;ust=1709654745259129&amp;usg=AOvVaw2Oj-dwthdItuCKwjg-Ar4O">Les Carmes Haut-Brion</a> – ‘majestic’, <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/vieux-chateau-certan/vieux-chateau-certan">Vieux Château Certan</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Cheval Blanc</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-canon/canon-(saint-emilion)">Canon</a>, and <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-lafleur/lafleur">Lafleur</a> – ‘compelling’. He also made a special mention of the dry white wines, namely <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-smith-haut-lafitte/smith-haut-lafitte-blanc">Smith Haut Lafitte Blanc</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-haut-brion/haut-brion-blanc">Haut-Brion Blanc</a> and <a href="https://www.google.com/url?q=https://winecap.com/wine-track/france/bordeaux/pessac-leognan/domaine-de-chevalier/domaine-chevalier-blanc&amp;sa=D&amp;source=docs&amp;ust=1709654745259637&amp;usg=AOvVaw3O7wWDQkY5OgCgHBDeTrLI">Domaine de Chevalier Blanc</a>.
<h2>Top-scoring Bordeaux 2021 wines</h2>
<img loading="lazy" decoding="async" class="alignnone wp-image-1900" src="https://wp.winecap.com/wp-content/uploads/2024/03/NM-375x153.png" alt="Neal Martin Bordeaux 2021 scores" width="800" height="327" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/NM-375x153.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/NM-768x314.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/NM.png 987w" sizes="(max-width: 800px) 100vw, 800px" />
Neal Martin’s top-scoring Bordeaux 2021 was a dry white wine, La Mission Haut-Brion Blanc, while Galloni gave a near-perfect score to a wine from Sauternes – Suduiraut.
Wines that appeared in both critics’ top ten included Les Carmes Haut-Brion, Vieux Château Certan, Lafleur, and Cheval Blanc.
For Galloni, Vieux Château Certan ‘may very well be the wine of the vintage from the Right Bank’, while Martin commented that it ‘transcends the limitations of the growing season’, calling it ‘outstanding’.
Another wine that critics agreed on was Lafleur, which Galloni described as ‘incredibly fascinating’ in 2021, and Neal Martin noted as a ‘strong contender for the wine of the vintage’.
<img loading="lazy" decoding="async" class="alignnone wp-image-1901" src="https://wp.winecap.com/wp-content/uploads/2024/03/AG-375x152.png" alt="Antonio Galloni Bordeaux 2021 scores" width="800" height="324" srcset="https://wp.winecap.com/wp-content/uploads/2024/03/AG-375x152.png 375w, https://wp.winecap.com/wp-content/uploads/2024/03/AG-768x311.png 768w, https://wp.winecap.com/wp-content/uploads/2024/03/AG.png 1005w" sizes="(max-width: 800px) 100vw, 800px" />
Full report and tasting notes are available on <a href="https://vinous.com/">Vinous</a>.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Bordeaux 2021 in bottle: Vinous’ top-scoring wines

<ul>
<li>Passion investing refers to collecting items you love and want to keep for the long term.</li>
<li>Some of the most popular passion assets that can yield substantial returns are rare stamps and coins, art, classic cars, luxury watches and fine wine. </li>
<li>Passion investing offers a unique blend of personal fulfilment and financial opportunity, allowing investors to engage deeply with their interests while potentially earning returns.</li>
</ul>
Passion investing represents a unique and emotionally rewarding approach to building wealth, diverging from traditional investment avenues like stocks, bonds, or real estate. This investment strategy is grounded in the acquisition of tangible assets that spark personal joy and enthusiasm, ranging from art and vintage cars to rare stamps, luxury watches, and fine wines.
Such investments not only have the potential to appreciate in value over time but also provide intrinsic satisfaction and a deep sense of personal fulfilment. This article offers an overview of passion investing, highlighting the diverse assets involved and the unique benefits they offer, with a particular emphasis on the allure of fine wine.
<h2>The spectrum of passion assets</h2>
Some of the most common passion investments are art, classic cars, luxury watches and fine wine.
Rare stamps and coins
Collecting stamps and coins is one of the oldest forms of passion investing. Rare specimens, especially those with errors or historical importance, can fetch significant sums. Collectors revel in the history and stories behind their acquisitions, adding a layer of intellectual engagement to the financial investment.
Art
Investing in art involves purchasing pieces from emerging or established artists with the expectation that their value will increase over time. Art investors often enjoy the aesthetic and cultural significance of their collections, providing an emotional return that transcends monetary gains.
Classic cars
Classic car enthusiasts invest in rare and historic automobiles, driven by a passion for automotive design and engineering. These vehicles often appreciate in value, especially well-maintained models or those with historical significance, offering financial rewards alongside the thrill of ownership and driving.
Luxury watches
The market for luxury watches has seen substantial growth, with vintage and limited-edition timepieces appreciating significantly. Enthusiasts appreciate the craftsmanship, history, and prestige associated with high-end watches, making this a passion investment that combines personal enjoyment with potential financial returns.
Fine wine
Fine wine stands out as a particularly intriguing passion investment. Beyond the potential for appreciation in value, wine collectors derive pleasure from the nuances of wine tasting, the history of vineyards, and the art of winemaking. This section will delve deeper into fine wine as a case study in passion investing.
<h2>The unique appeal of fine wine investment</h2>
Fine wine embodies the essence of passion investing by offering both tangible and intangible returns. As a consumable asset, its value can appreciate due to factors like rarity, vintage quality, and global demand. Fine wine investment attracts those who are not only looking for financial gains but also for the enjoyment of collecting, tasting, and learning about wine.
Diversification and stability
Fine wine has demonstrated a relatively stable investment performance, often showing resilience in the face of economic downturns. Adding fine wine to an investment portfolio can provide diversification, reducing overall risk and smoothing out volatility.
Enjoyment and experience
Investing in fine wine is as much about the experience as it is about the potential financial returns. Collectors often take pride in hosting tastings, visiting vineyards, and immersing themselves in the rich culture and history of wine-making, which adds a deeply personal dimension to the investment.
Inflation hedge
Tangible assets like fine wine can serve as a hedge against inflation. As the value of money decreases, the value of physical goods can increase, protecting the purchasing power of the investor&#8217;s capital.
Passion investing offers a unique blend of personal fulfilment and financial opportunity, allowing investors to engage deeply with their interests while potentially earning returns. Successful fine wine investing requires knowledge and expertise. Investors should familiarize themselves with the wine market, including factors that affect wine prices and the best practices for buying, storing, and eventually selling wine for profit. Proper storage is crucial to maintain the quality and value of the wine, and provenance plays a significant role in its appreciation.
To find out how investment in fine wine works in practice, read our in-depth <a href="https://winecap.com/learn/fine-wine-investment">Fine Wine Investment Guide</a>.

Passion investing: personal interest or financial opportunity?

<ul>
<li>Wine Advocate has released William Kelley’s report on Bordeaux 2021 in-bottle. </li>
<li>According to the report, the best producers ‘especially those working with the best terroirs […] have produced some excellent wines’. </li>
<li>Haut-Brion, Cheval Blanc and Montrose were the highest-scoring wines of the vintage, receiving 97 points. </li>
</ul>
<a href="https://www.robertparker.com/articles/HhsFr6BvQiYFJ4QSA">Wine Advocate</a> has released William Kelley’s report on Bordeaux 2021 in-bottle based on his tastings, alongside his colleague Yohan Castaing. Kelley’s in-bottle verdict confirms his En Primeur assessment of this variable vintage.
<h2>A farmers’ vintage</h2>
Kelley wrote that the results were mixed, but ‘the best farmers, especially those working with the best terroirs and armed with the resources to take risks and make a strict selection, have produced some excellent wines’.
2021 is largely seen as a ‘farmers’ vintage’. According to Kelley, ‘the best 2021s are beautiful wines that exemplify how much technical progress Bordeaux has made over the last decade in the vineyards and in the winery’.
He attributes the best results to nurture over nature; however, this ‘doesn’t change the results in the glass’.
<h2>Vintage comparisons</h2>
Due to the heterogeneous nature of the 2021s, stylistic comparisons with back vintages are harder to make. For Kelley, ‘many wines are supple and charming, reminiscent of a modern-day version of the 1999 vintage: the perfect “restaurant vintage,” if one forgets their price’.
He added that ‘some of the best northern Médoc reds, with their serious, intensely Cabernet Sauvignon-driven personalities, evoke the 1996 vintage; whereas the Right Bank’s best 2021s are more sensual and seductive’.
When it comes to pricing, many 2021s are now available below their release price, making them an attractive investment proposition where quality is high.
<h2>The best Bordeaux 2021s</h2>
Kelley highlighted Cheval Blanc (97), Figeac (96+), Haut-Brion (97), Léoville-Las Cases (96+) and Montrose (97) as his wines of the vintage.
For Castaing, the 2021 First Growth reflects ‘the timeless elegance of Haut-Brions from cooler years [and] will delight Bordeaux purists’.
When it comes to Cheval Blanc, Kelley revealed that ‘director Pierre-Olivier Clouet even considers it to be superior to the 2020, a preference that I share’. The 2021 is one of the most affordable recent vintages from the estate.
The other highest-scoring wine, Montrose, got Kelley’s ‘nomination for the title of &#8220;wine of the vintage&#8221; in the Médoc’. The critic said it ‘entirely transcends the limitations of the year’.
<img loading="lazy" decoding="async" class="alignnone wp-image-1878" src="https://wp.winecap.com/wp-content/uploads/2024/02/Scores-375x166.png" alt="Bordeaux 2021 in-bottle scores" width="800" height="353" srcset="https://wp.winecap.com/wp-content/uploads/2024/02/Scores-375x166.png 375w, https://wp.winecap.com/wp-content/uploads/2024/02/Scores-768x339.png 768w, https://wp.winecap.com/wp-content/uploads/2024/02/Scores.png 929w" sizes="(max-width: 800px) 100vw, 800px" />
Full report and tasting notes are available on the <a href="https://www.robertparker.com/">Wine Advocate</a>’s website.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Wine Advocate releases Bordeaux 2021 in-bottle scores

<ul>
<li>If interest rates increase or stay the same, there may be golden opportunities for savvy investors to fill their wine cellars for lower-than-average prices.</li>
<li>If the Bank of England starts to drop interest rates consecutively around May, we would expect the fine wine market to show signs of growth around autumn.</li>
<li>Rather than focus on short-term economic events, we encourage investors to buy high quality fine wines, and ideally hold them for at least a decade.</li>
</ul>
Today&#8217;s interest rates are <a href="https://www.bankofengland.co.uk/monetary-policy/the-interest-rate-bank-rate">5.25%</a> in the UK. That is a lot higher than most of us are used to. For example, in 2019 <a href="https://www.bankofengland.co.uk/monetary-policy-summary-and-minutes/2019/may-2019#:~:text=Our%20Monetary%20Policy%20Committee%20has,and%20UK%20government%20bond%20purchases.">they were just 0.75%</a>. But it is reassuring that they have not been cranked up even more over the past months. Consensus among most economists is that the rates will surely come down again in 2024. The question is, by how much?
Unlike the US Federal Reserve, the Bank of England is warning markets not to expect big cuts. As Reuter&#8217;s reports, its ‘<a href="https://www.reuters.com/world/uk/bank-england-pushes-back-against-rate-cut-speculation-2023-12-14/">policy stance assumes a slow fall in interest rates to 4.25% in three years&#8217; time</a>’. However, many economists think that the rates will fall sooner.
Contrary to the central bank, Goldman Sachs predict <a href="https://www.cityam.com/why-goldman-sachs-predict-earlier-and-more-aggressive-interest-rate-cuts-from-central-banks/">rates will dip below 4%</a> by the end of the year, marking a drop of more than 1.25%. Experts at Deutsche Bank are almost aligned, <a href="https://www.forexlive.com/centralbank/analysts-forecast-rate-cuts-by-bank-of-england-citing-softer-wage-growth-inflation-20240104/">anticipating a 1.0% dip</a> in the same timeframe. Andrew Goodwin, chief UK economist at Oxford Economics consultancy, expects the bank to <a href="https://www.ft.com/content/862f14fd-da31-4e38-8404-e70904a8fd4b">start lowering rates in May</a>. However, other economists suggest that June is more realistic.
In this article, we consider what these different scenarios mean for fine wine investors. When to buy, when to sell and when to hold are all critical questions as we dive into 2024.
<h2>If interest rates increase or stay the same</h2>
Continued high rates would probably be unwelcome news for most fine wine investors. Dovish policies like this usually led to a stronger pound, making wine more expensive for international buyers if sourcing from the UK market.
Asian and American buyers are a significant part of the fine wine market and cutting them out would probably lead to a dip in prices, as supply outstrips demand.
High interest rates could also temper domestic demand. After all, when the economy shrinks, there is less money for luxury goods. Buyers may opt for better &#8216;value&#8217; purchases.
The compelling interest rates of savings accounts could also tempt investors away from illiquid assets. Over the short-term, putting cash into a bank account could seem like a safer bet. Even though, of course, over the long-term, the inflation risk is severe.
Ongoing high interest rates would likely create a buyer&#8217;s market. For the first few months of the year, until May, we could expect this to continue happening. Around this time, there may be golden opportunities for savvy investors to fill their cellars for lower-than-average prices. 
<h2>If interest rates decrease by 0.25% &#8211; 2%</h2>
The most likely scenario is that the Bank of England will gradually reduce rates, starting from late spring or early summer. Most analysts (including Deutsche Bank, Goldman Sachs and Fidelity) seem to be anticipating a drop of at least 1.0%, and the markets have already priced this into products and forecasts. As seen in the news recently, <a href="https://www.theguardian.com/business/2024/jan/11/bank-of-england-may-cut-interest-rate-sooner-after-surprise-inflation-forecast">inflation seems to be cooling</a>, creating the right environment for interest rate cuts. For fine wine investors, this makes for reassuring reading.
Shrinking interest rates will make other low-risk investments like gold or savings accounts less compelling. Investors will probably start to feel the pull of more assets with more generous risk premiums. During the second half of the year, if interest goes down, fine wine prices might slowly increase.
A growing economy usually comes with more money to pop Champagne and see the year through in style. We&#8217;d expect the fine wine market to perk up in this environment.
Lower interest rates would probably be welcome news for international investors, as this usually signals better exchange rates. In 2021 and 2022, the weak pound and strong dollar stimulated Asian and American markets, boosting fine wine prices.
If the Bank of England starts to drop interest rates consecutively around May, we would expect the fine wine market to show signs of growth by around autumn. Prices would probably begin to creep up and continue rising with each rate cut. This would balance out the market, likely creating more demand and opportunities for sellers. 
<h2>If interest rates plunge by 2% or more</h2>
It seems unlikely that interest rates will ever return to their pre-pandemic lows. Some experts, <a href="https://www.fidelity.co.uk/markets-insights/markets/uk/what-is-the-outlook-for-interest-rates-in-2024/">like those at Fidelity</a>, argue that the previous rates were even kept ‘artificially low’, and overdue a correction. However, as recent years have taught us, unexpected things can happen.
If interest rates nosedive by more than 2% over 2024, it would probably be exceptionally good for fine wine investors. Both global and local demand would likely increase, as we saw in 2021. With the cost of borrowing plunging, we could expect to see more budgets allocated to luxury products like fine wine, creating more of a sellers&#8217; market.
Fine wine investors in 2021 already enjoyed the rewards that come with a weak pound and low interest rates. International buyers leap into the market, creating a surge in demand.
If the interest rates cascade down to 3% or less by the end of the year, we would expect to see demand outstrip supply, leading to a hike in fine wine prices. This would be welcome news for sellers looking to cash-in their returns. 
<h2>In the long-term, does it matter?</h2>
These predictions cover interest rate hikes over the next twelve months. But the real returns of fine wine tend to come in the longer run. As the Liv-ex 1000 index shows, fine wine prices on average have nearly doubled since 2014.
Rather than focus on short-term economic events, we encourage investors to buy high quality fine wines, care for them properly, and ideally hold them for at least a decade. For us, this is the true beauty of wine; its value is mostly intrinsic.
If you&#8217;d like to talk to an expert about buying or selling fine wine, we are just <a href="https://winecap.com/start-investing">a call or an email away</a>.

How could 2024’s interest rates impact fine wine?

<ul>
<li>Burgundy prices continued to spiral downwards in January, falling 3.7%. </li>
<li>This created a challenging backdrop for the unfolding Burgundy 2022 campaign, which saw about 10% of producers reduce pricing year-on-year.</li>
<li>The current market dynamics offer investors a unique window to enrich their collections with both new gems and proven performers.</li>
</ul>
Burgundy took the spotlight at the beginning of the year with the unfolding 2022 En Primeur campaign. Already in our <a href="https://winecap.com/learn/q4-2023-fine-wine-report-2024-outlook">Q4 2023 report</a>, we questioned the potential of the new releases to stimulate an otherwise dormant market. On the one hand, there was the excitement of the new mixed with high <a href="https://winecap.com/news/burgundy-2022-a-promising-vintage-in-a-challenging-market">quality and quantity</a> playing to the campaign’s advantage; on the other, much depended on pricing.
<h2>Market conditions and pricing challenges</h2>
Burgundy prices continued to spiral downwards in January, with the <a href="https://www.liv-ex.com/">Liv-ex</a> Burgundy 150 index starting the year with a 3.7% decrease. To say that this created a <a href="https://winecap.com/news/burgundy-2022-a-promising-vintage-in-a-challenging-market">challenging backdrop</a> for the new releases would be an understatement. Prices at release had to come down.
And partially they did. According to Liv-ex, about 10% of the top producers ‘lowered their prices year-on-year’. However, ‘about 40% raised their prices, even if only modestly’. Thanks to greater quantities, allocations were mostly restored.
<h2>Burgundy 2022 – ‘a treasure trove’</h2>
As the first releases landed, Burgundy 2022 enjoyed a positive reception from critics and trade. Neal Martin (<a href="https://vinous.com/articles/now-for-my-latest-trick-burgundy-2022-jan-2024">Vinous</a>) advised that ‘if your favourite growers’ price tags seem fair, then I would not hesitate diving in’. He described the 2022 vintage as ‘Burgundy’s latest trick: a treasure trove of bright ‘n bushy-tailed whites and reds in a season that implied such wines would be impossible, wines predestined to give immense drinking pleasure’.
<h2>Investment perspective and older vintages</h2>
However, prices for older vintages remain under pressure, creating buying opportunities for already physical and readily available wines. For instance, three of Burgundy’s outstanding long-term wine performers have all seen dips between 15% and 10% in the last year. Over the last decade, however, DRC Vosne-Romanée Cuvée Duvault Blochet is up 388%; Georges Roumier Bonnes Mares – 339%, and Armand Rousseau Chambertin – 279% on average.
<img loading="lazy" decoding="async" class="alignnone wp-image-1869" src="https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-wines-375x255.png" alt="Burgundy wines performance" width="800" height="545" srcset="https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-wines-375x255.png 375w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-wines-768x523.png 768w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-wines.png 1053w" sizes="(max-width: 800px) 100vw, 800px" />
Meanwhile, the Burgundy 150 index has decreased 16% in the last year. Still, the overall long-term index trajectory remains upwards, as the chart below shows.
<img loading="lazy" decoding="async" class="alignnone wp-image-1868" src="https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-375x243.png" alt="Burgundy index" width="800" height="519" srcset="https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-375x243.png 375w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-768x498.png 768w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-1536x996.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-2048x1328.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-1200x778.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/02/Burgundy-index-1980x1284.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Searching for value</h2>
The current market dynamics offer investors a unique window to enrich their collections with both new gems and proven performers across older physically available vintages.
When it comes to the latest, the Burgundy 2022 En Primeur campaign presents a complex tapestry of quality, quantity, and pricing amidst challenging market conditions. Despite initial price pressures, the adjustments made by producers and the positive critical reception underscore the potential of the new releases. Neal Martin&#8217;s endorsement further elevates the vintage, suggesting that for the discerning buyer, Burgundy 2022 provides not just immediate drinking pleasure but also long-term investment opportunities.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Assessing the Burgundy 2022 En Primeur campaign

<ul>
<li>British businesses have suffered declines in EU trade.</li>
<li>Billions-worth of investment assets have left the UK, opting for EU states.</li>
<li>Bucking the trend, fine wine prices soared to heights of 43%.</li>
</ul>
By the end of 2019, <a href="https://yougov.co.uk/topics/politics/survey-results/daily/2019/10/29/60c8e/2">70% of Brits</a> were already nauseous of the word ‘Brexit’. But behind the fatigue, there was real fear in the air too. As the customs rules came into effect in 2021, gridlocked lorries clogged the roads to Dover, paperwork mounted, and supermarkets shelves began to look increasingly bare. The end of the single market had begun. The past years have been sobering time. According to the latest poll in January 2024, <a href="https://www.whatukthinks.org/eu/opinion-polls/poll-of-polls-uk-eu/">61% of Brits would vote to rejoin</a> the EU, <a href="https://yougov.co.uk/politics/articles/45910-britons-would-vote-rejoin-eu">up from 55% in summer 2023.</a>
But what about the investment markets, and the performance of fine wine? In this article, we are diving into some of the main impacts of Brexit so far.
<h2>Added complexity dampened profitability</h2>
<a href="https://www.ft.com/content/ffac65e1-1ee3-4a1c-b3b1-ec970bc7b53c">81% of UK businesses are still struggling</a> with Brexit admin. For wine traders, the paperwork for a single bottle can stretch to over 90 pages, adding significant workloads. UK manufacturers are particularly suffering, with <a href="https://www.pesmedia.com/90-of-uk-manufacturers-still-dealing-with-issues-trading-with-eu">96% reporting</a> that the new rules have ‘badly disrupted trade with the EU’.
More compliance means more costs. It is estimated that businesses have spent an <a href="https://www.ft.com/content/ffac65e1-1ee3-4a1c-b3b1-ec970bc7b53c">average of £100,000 each</a> just trying to export goods over the border in the past years.
The complications have also led to once-loyal European customers jumping ship, with the average enterprise missing out on <a href="https://www.ft.com/content/ffac65e1-1ee3-4a1c-b3b1-ec970bc7b53c">£96,281</a> since 2020. <a href="https://www.pesmedia.com/90-of-uk-manufacturers-still-dealing-with-issues-trading-with-eu">Two in five UK manufacturers</a> have experienced declines in export volumes.
<h2>&#8216;Brexodus&#8217; carried talent (and investment) out of the UK</h2>
It is little surprise therefore that busloads of businesses, staff and operations decided to relocate. Welsh wine exporter <a href="https://www.theguardian.com/politics/2022/jul/26/british-wine-wholesaler-leave-uk-over-post-brexit-paperwork">Daniel Lambert, for example, moved his company to France in 2022</a>. Lambert supplies some of the biggest British supermarkets, including Waitrose and Marks &amp; Spencer.
Dublin has been one of the <a href="https://www.ey.com/en_uk/news/2022/03/ey-financial-services-brexit-tracker-movement-within-uk-financial-services-sector-stabilises-five-years-on-from-article-50-trigger#:~:text=The%20total%20number%20of%20announced,after%20Article%2050%20was%20triggered.">major hotspots for financial services</a>, snatching-up the UK’s crown as the English-speaking bridge to the EU. This ‘Brexodus’ as it came to be known was great news for European cities. Germany, for example, <a href="https://www.independent.co.uk/news/uk/politics/brexit-uk-companies-germany-eu-b2344039.html">enjoyed a 21% increase in direct foreign investment in May 2023</a>.
However, it did not bode well for the UK. By March 2022, <a href="https://www.ey.com/en_uk/news/2022/03/ey-financial-services-brexit-tracker-movement-within-uk-financial-services-sector-stabilises-five-years-on-from-article-50-trigger#:~:text=The%20total%20number%20of%20announced,after%20Article%2050%20was%20triggered.">7,000 jobs</a> within financial services moved to the EU. Investment funds left too, with <a href="https://www.ey.com/en_uk/news/2022/03/ey-financial-services-brexit-tracker-movement-within-uk-financial-services-sector-stabilises-five-years-on-from-article-50-trigger#:~:text=The%20total%20number%20of%20announced,after%20Article%2050%20was%20triggered.">24 firms planning to transfer £1.3 trillion of assets</a>. Funding for British markets faltered.
As a biproduct of Brexit, the supply of skilled EU workers dwindled too. Today, recruiting European talent is <a href="https://www.pesmedia.com/90-of-uk-manufacturers-still-dealing-with-issues-trading-with-eu">44% more difficult</a> for UK companies. December 2023 saw the launch of <a href="https://www.reuters.com/world/uk/uk-pm-sunak-committed-bringing-net-migration-down-significantly-spokesman-2023-12-04/">even stricter measures</a> designed to curb the flow of foreigners, although it also introduced higher minimum wages for skilled workers.
<h2>Slow growth turns off investors</h2>
Brexit was accompanied by the Covid-19 pandemic, political instability, and war overseas. While it is difficult to untangle the impact of Brexit, the UK has been notably slow to recover compared to peers. The Eurozone, for example, has <a href="https://commonslibrary.parliament.uk/research-briefings/sn02784/">grown at more than double the UK pace.</a>
Increasingly, data suggests Brexit threw a wet towel on the UK’s growth prospects. As Jonathan Portes, Professor of Economics and Public Policy at <a href="https://cepr.org/voxeu/columns/impact-brexit-uk-economy-reviewing-evidence">King’s College London</a>, highlights, ‘both aggregate data and survey evidence strongly suggest that Brexit is at least in part responsible for the particularly poor performance since 2016, with investment perhaps 10% lower than it would otherwise have been’.
2024 analysis by the National Institute of Economic and Social Research corroborates, stating, ‘<a href="https://www.niesr.ac.uk/wp-content/uploads/2023/11/JC760-NIESR-Outlook-Autumn-2023-Global-Topical-Feature-v2.pdf?ver=AIQekVbRbrQucSuemgY2">UK real GDP is some 2-3 per cent lower due to Brexit</a>’. Each household is now £850 worse-off following Brexit, rising to £2,300 by 2035.
<h2>The retail wine market has suffered but not fine wine</h2>
Since Brexit, supermarket wine has had an <a href="https://www.thegrocer.co.uk/alcohol/wine-importers-bemoan-cost-of-brexit-red-tape-as-shelf-edge-prices-climb/686232.article">estimated price increase of £3.50 per bottle.</a> Perhaps in response, the government recently announced measures to ‘cut red tape’. The definition of wine will change to allow for <a href="https://www.thedrinksbusiness.com/2023/10/post-brexit-defra-reforms-will-end-ban-on-blending-imported-wine/">wine mixing</a>, <a href="https://www.euronews.com/business/2023/10/19/uk-alcohol-free-https:/www.euronews.com/business/2023/10/19/uk-alcohol-free-beverages-to-be-labelled-as-wine-amid-industry-rule-easing-to-be-labelled-as-wine-amid-industry-rule-easing">lower alcohol volumes</a>, and <a href="https://www.bbc.com/news/uk-politics-67795075">even pint-sized measurements</a>.
The prices of fine wine went up too. Investment grade bottles, <a href="https://winecap.com/">such as those traded on WineCap</a>, performed exceptionally well during the turbulent Brexit periods. Many investors found fine wine <a href="https://winecap.com/learn/how-to-use-fine-wine-as-a-hedge-against-inflation">hedged their portfolios</a> against losses elsewhere.
The graph below shows the performance of the broadest fine wine market measure (Liv-ex 1000) over the past five years.
<img loading="lazy" decoding="async" class="alignnone wp-image-1863" src="https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-375x246.png" alt="Fine wine vs FTSE 100" width="800" height="524" srcset="https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-375x246.png 375w, https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-768x503.png 768w, https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-1536x1006.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-2048x1342.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-1200x786.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/02/LX1000-vs-FTSE100-1980x1297.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
In the run-up to the customs changes, fine wine prices rose during mid-2020. Over the following two years, they saw an increase of 43%. This is in stark contrast to the performance of the FTSE100.
The returns didn’t end there. Because of fine wine’s unique tax status as a ‘wasting chattel’ in the UK, <a href="https://winecap.com/learn/changes-to-capital-gains-tax-what-does-this-mean-for-fine-wine-investors">nearly all bottles are exempt from costly capital gains taxes</a>. For those earning over £50,271 a year, this means savings of up to 28%.
<h2>To invest or not to invest?</h2>
Despite taking hits from Brexit, the UK is still an investment hub. Tourists are returning to London, businesses are battling through the headwinds, and gradually it is becoming clear that there needs to be more cooperation with the EU.
Throughout this turbulent time, fine wine has reached new heights. The (potentially Brexit-induced) combination of the weak pound and high dollar <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/04/05/the-pairing-of-old-wine-and-new-markets-trends-in-the-wine-industry/?sh=7b2e420629ee">opened the floodgates for foreign fine wine investments</a>. And the <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/10/05/when-silicon-valley-met-sauvignon-blanc-the-technology-behind-todays-wine/?sh=762d81e17a32">UK’s thriving tech scene</a> also created inroads for savvy digital investors to trade fine wine. Investors have made the most of these glimmering opportunities to batten-down the hatches and shield their portfolios against some of the other Brexit difficulties.
If you are looking for a smooth way to invest in fine wine, our experts at WineCap are happy to guide you through the journey. Unlike Brexit admin, <a href="https://winecap.com/schedule-a-call">we are just a call away.</a>
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Four years since Brexit: is the UK still an investment hub?

<ul>
<li>Capital Gains Tax is a tax on the profit when you sell an asset that has increased in value.</li>
<li>From 6 April 2024, investors will pay up to 28% tax on profit over £3,000.</li>
<li>As a ‘wasting asset’, fine wine is exempt from Capital Gains Tax.</li>
</ul>
When should you start paying tax should you pay on profit? Apparently, it depends on the year you&#8217;re in. Pre-2022, investors paid tax on anything above £12,300. However, the past few years have seen the threshold slashed in half twice. In a bid to plug the &#8220;<a href="https://lordslibrary.parliament.uk/autumn-statement-2022-key-announcements-and-analysis/">fiscal black hole</a>&#8220;, Chancellor Jeremy Hunt announced limit cuts in the 2022 Autumn Budget. From 6 April 2024, investors will pay up to 28% on profit over £3,000.
However, there are some exceptions. Those who take advantage of Individual Savings Account (ISA) tax wrappers, for example, can invest up to £20,000 without paying Capital Gains Tax (CGT). Another exception is fine wine with a shelf life of less than 50 years.
<h2>Why is fine wine exempt from CGT?</h2>
Fine wine is usually classed as a ‘wasting asset’ or ‘wasting chattel’. This unflattering name is a blessing in disguise. It means that the HMRC do not consider it to be an investment where the profit should be taxed.
Other assets in this same category include personal machines. If you collect classic cars, vintage watches or antique clocks, you could also benefit from CGT-free returns. An added benefit is that these passion investments are inflation busters that tend to ride high despite economic worries.
<h2>How much profit can fine wine investors keep?</h2>
Provided the fine wine has a shelf life of less than fifty years – which is almost every fine wine – investors can keep all the profit. As we touched on in the section above, this can amount to significant sums. Some of <a href="https://winecap.com/learn/q4-2023-fine-wine-report-2024-outlook">last year’s top-performers</a>, for instance, rose as much as 88% in a year. On average, fine wine prices have risen 14.1% in the last five years, and 62.7% in the last decade.
For other investments, which do attract CGT, such as buy-to-let property, gold, shares, bonds, art or commodities, investors must pay tax after £3,000. If they are basic taxpayers, the CGT comes to 18%. And for higher tax bands, it&#8217;s 28%.
<h2>How to tax-exempt assets like fine wine impact investment portfolios?</h2>
As the expression goes, investors should never put all their eggs in one basket. Spreading wealth across a variety of different assets, known as diversification, is at the heart of modern portfolio theory.
Investing in wasting assets like fine wine, alongside stocks, bonds, property, commodities and cash adds some advantages. One of these is that the tax savings can help balance out the increased taxes and fees from elsewhere. Buy-to-let properties for example are facing a double-whammy of increased taxation and hiked mortgage rates. Off-setting some of these expenses against the profits of wine can help to keep the whole portfolio in check.
Another benefit is that wasting assets generally tend to be inflation resistant, as their value comes from within. This can help to smooth out the inflation erosion of bonds and cash over the long-term.
Finally, wasting assets like fine wine tend to move slowly. While the market ebbs and flows, changes take months. This couldn&#8217;t be more different from high-risk stocks or crypto assets, which can soar and plummet in moments. Investing in fine wine can have a calming effect on the overall performance of a portfolio. This could be welcome news for investors who may not relish turbulent performances.
<h2>Where can you find out more?</h2>
Get a full picture of how <a href="https://winecap.com/learn/fine-wine-taxation-2023">fine wine taxation works with our complimentary guide</a>. You can also speak to one our experts completely for free. Simply <a href="https://winecap.com/start-investing">book a thirty-minute consultation</a> with no strings attached, for a personalised conversation.
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Changes to Capital Gains Tax: what does this mean for fine wine investors?

<ul>
<li>The Chinese zodiac has historically impacted fine wine demand in Asia.</li>
<li>2024 is the year of the Wood Dragon, with previous vintages under the same sign being 2012, 2000, 1988 and 1976. </li>
<li>We examine the best wines from these ‘Dragon’ years and other associated labels. </li>
</ul>
As the Lunar New Year draws near, that of the Wood Dragon, the fine wine market is feeling the influence of the Chinese zodiac. Historically, the zodiac has had an impact on buying, particularly in Asia, with increased demand for wines from previous vintages carrying the same zodiac sign or those symbolically linked to it. Which will be the trending ‘Dragon’ wines this year?
<h2>Past ‘Dragon’ vintages</h2>
The last four ‘Dragon’ vintages were 2012, 2000, 1988 and 1976.
2012
In terms of growing season, the most recent 2012 ‘Dragon’ year was challenging in many fine wine producing regions, including Bordeaux and Burgundy, which led to mixed quality. However, it is widely considered as one of the greatest Champagne vintages this century, with Tuscany and the Rhône also excelling in some areas. Famous 100-point (Wine Advocate) wines include <a href="https://winecap.com/wine-track/france/rhone/hermitage/m.-chapoutier/ermitage-ermite">M. Chapoutier Ermitage l&#8217;Ermite</a> from the Rhône (rated by Jeb Dunnuck), <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-l'eglise-clinet/eglise-clinet">L&#8217;Eglise-Clinet</a> from Bordeaux (William Kelley), <a href="https://winecap.com/wine-track/spain/castilla-y-leon/ribera-del-duero/dominio-de-pingus/pingus">Pingus</a> (Luis Gutiérrez) from Spain and <a href="https://winecap.com/wine-track/united-states/california/oakville/screaming-eagle/cabernet-sauvignon">Screaming Eagle</a> (Robert Parker) from California.
2000
The 2000 vintage was brilliant in Bordeaux with many of the wines now reaching maturity. This classic vintage saw Parker award <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-pavie/pavie">Pavie</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-la-mission-haut-brion/mission-haut-brion">La Mission Haut-Brion</a> and <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/petrus/petrus">Pétrus</a> 100-point scores, with <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-lafleur/lafleur">Lafleur</a> receiving the same perfect score from Neal Martin, and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Cheval Blanc</a> from Antonio Galloni. The 2000 was also another legendary year for Champagne, with highly rated wines including <a href="https://winecap.com/wine-track/france/champagne/na/krug/clos-du-mesnil">Krug Clos du Mesnil</a>, <a href="https://winecap.com/wine-track/france/champagne/na/louis-roederer/cristal">Louis Roederer Cristal</a> and Dom Pérignon P2. In Burgundy, the vintage was largely seen as one for early consumption due to low acidity, but many of the wines are now drinking perfectly. The appellations that shone were Nuits-Saint-Georges, Chambolle-Musigny and Morey-Saint-Denis.
1988
A great year for the sweet wines of Bordeaux, 1988 Sauternes and Barsac have stood the test of time. Initially considered a Right Bank vintage, Lisa Perrotti-Brown MW (<a href="https://thewineindependent.com/">The Wine Independent</a>) recently wrote that wines ‘from Saint-Émilion, Pomerol, and Pessac-Léognan […] should be drunk soon’. 1988 is another vintage to drink soon in Burgundy that produced classic, long-lived wines with good depth of fruit. The year was much more abundant in Chardonnay than in Pinot Noir, and hence better for reds than for whites.
1976
Going back close to 50 years, the 1976 vintage was a mixed bag for much of the wine world. In France, Champagne and Alsace fared better than Bordeaux and Burgundy, and Germany enjoyed a fantastic year. The most significant event was the Judgement of Paris tasting, which put California on the fine wine map. In terms of 100-point wines, Robert Parker’s 1976 favourites were Penfolds Grange and <a href="https://winecap.com/wine-track/france/rhone/cote-rotie/e.-guigal/cote-rotie-mouline">Guigal C</a><a href="https://winecap.com/wine-track/france/rhone/cote-rotie/e.-guigal/cote-rotie-mouline">ô</a><a href="https://winecap.com/wine-track/france/rhone/cote-rotie/e.-guigal/cote-rotie-mouline">te-R</a><a href="https://winecap.com/wine-track/france/rhone/cote-rotie/e.-guigal/cote-rotie-mouline">ô</a><a href="https://winecap.com/wine-track/france/rhone/cote-rotie/e.-guigal/cote-rotie-mouline">tie La Mouline</a>.
<h2>Beychevelle – the most famous ‘Dragon’ wine</h2>
When it comes to associations, <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-beychevelle/beychevelle">Château Beychevelle </a>is an apt choice for the ‘Dragon’ year as its Chinese name means ‘dragon boat’. The wine’s label also depicts a ship with the head of a griffin. Its 2012 vintage is ‘one of the stars of St. Julien’, according to Parker, who described it as ‘elegant and powerful, rich and intense, but light on its feet’. He recommended drinking it between 2019 and 2051.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

‘Dragon’ wines for Chinese New Year

<ul>
<li>Fine wine can effectively hedge against inflation, often outperforming traditional assets like gold and stocks.</li>
<li>Investment in fine wine requires consideration of personal ethics, liquidity needs, and a long-term strategy.</li>
<li>Strategic timing in fine wine investment, such as early purchases, can lead to significant profit taking.</li>
</ul>
Since 1914, the price of bread has seen inflation of around 11,000%. In the roaring 20s, a loaf cost under a penny. Fast forward to today, the average bread costs <a href="https://www.thisismoney.co.uk/money/news/article-2950798/Price-loaf-bread-rises-11-000-past-100-years-thanks-inflation-says-Lloyds.html">around £1.35</a>. This price rise is not due to an increase in the quality of bread but rather a reflection of the decreasing purchasing power of money over time. In the words of the French writer and Burgundy lover, Hugo Voltaire, ‘Paper money eventually returns to its intrinsic value – zero’.
As well as playing havoc with our savings, <a href="https://www.forbes.com/advisor/in/investing/how-does-inflation-affect-fixed-income-investments/">inflation can be the undoing of fixed-income investment portfolios too</a>. Unless the interest rates outpace the loss of purchasing power, repayments will be worth less and less each year. In these tense economic times, investors may be tempted by hedge funds and hedging assets like derivatives. While these can offer reassurance, they&#8217;re also complicated and expensive. So-called &#8216;safe haven&#8217; assets like gold and property are also effective inflation-hedges. But right now, they are trading at a premium. This article explores an alternative option: fine wine as a hedge against inflation risk.
<h2>Assess your inflation exposure in your investment strategy</h2>
If you invest in liquid and fixed-income investments like cash or bonds, your wealth is probably exposed to inflation. This tends to be more typical for those closer to retirement, as they may need access to regular funds. Start by identifying these assets in your portfolio. Pay close attention to bonds which last more than five years, as the interest payments (or coupons) could be more at risk of losing value over time.
Once you&#8217;ve identified the riskiest assets, refer to your strategy. There may already be a plan for how to deal with periods of high inflation. Most managers will build-in hedging assets from the beginning. But many will also deviate from the strategy tactically from time to time. For example, in high inflation environments, they might sell some bonds and buy stocks – known as going ‘overweight’ or ‘underweight’ from the original allocations. This is what you may need to do if you have too much inflation risk in your portfolio. Depending on your financial needs, fine wine could be a sensible alternative investment for you.
<h2>Consider if fine wine is right for you</h2>
Fine wine is a truly excellent hedge against inflation. However, it may not be suitable for everyone. If you do not want to invest in fine wine because of religion or personal reasons, you should follow your ethics. Wine is not the only inflation-resistant asset, and you may be better suited to art, luxury watches and collectible cars.
You should also consider your liquidity needs. Fine wine is a long-term asset with intrinsic value. Investors can only collect returns after the bottles have been sold. And for the best results, that could take upwards of five years.
Investors should also be aware that fine wine is traded on the private market. Nowadays, this is much easier than it used to be. Instead of attending physical auctions and joining exclusive clubs, you can find fine wine investment platforms online.
<h2>Find a wine to suit your time horizon</h2>
The value of fine wine typically increases with age. Investors often buy fine wine at least five years in advance, with some opting for En Primeur purchases.
In this world, timing is everything. And if you can get it right, you stand to make a handsome profit. Over ten years, Domaine Arnoux-Lachaux Nuits-Saint-Georges Rouge, for example, has delivered returns of <a href="https://winecap.com/wine-track/france/burgundy/nuits-saint-georges/domaine-arnoux-lachaux/nuits-saint-georges-rouge">525% and counting</a>.
Before you begin, consider carefully what type of time horizon you are comfortable with. Ideally, you&#8217;re looking to plug the inflation gaps in your portfolio, without landing yourself into an illiquidity issue. For example, if you&#8217;re concerned about the inflation risk of some five-year bonds, you could look into ‘brands on the move’ that have historically delivered faster returns.
<h2>Understand the fine wine market</h2>
Fine wine attracts a diverse range of buyers, from enthusiasts to those purchasing for business or personal milestones. Understanding buyer motivations and regional preferences is key to strategic investing. Seasonal trends, like the heightened demand for Champagne towards the end of the year, also play a role in maximising returns.
<h2>A precious and depleting asset with intrinsic value</h2>
If you&#8217;re looking to shield your wealth from the erosive effects of inflation, <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/08/30/how-to-include-fine-wine-in-your-investment-portfolio/?sh=11ac67381789">fine wine could be the answer</a>. It is a precious and depleting asset, with intrinsic value. As one academic paper recently found, ‘<a href="https://www.sciencedirect.com/science/article/abs/pii/S1059056022000090#preview-section-cited-by">fine wine has outperformed almost every other major financial index over the past two decades</a>’. However, to get the best results, you&#8217;d probably need to buy, hold and think long-term.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

How to use fine wine as a hedge against inflation

Our Q4 2023 report has now been released. The report offers a comprehensive overview of the fine wine market in the last quarter and a forward-looking perspective for 2024. In a landscape marked by correction and repositioning, it delves into the dynamic interplay of market forces, unveiling both challenges and opportunities for investors.
Report highlights:
<ul>
<li>The fine wine market is navigating 2024 amidst a correction phase, presenting a chance for strategic repositioning.</li>
<li>Fine wine prices (Liv-ex 100 index) experienced a 4.2% decline in Q4, reflective of market adjustments amid global economic uncertainties.</li>
<li>Increased risk aversion has redirected focus to classic wines and regions, with Bordeaux emerging as a standout beneficiary.</li>
<li>Bordeaux&#8217;s resurgence, driven by liquidity and a solid reputation, underscores the market&#8217;s adaptability to changing dynamics.</li>
<li>The upcoming high-volume Burgundy and Bordeaux En Primeur campaigns present opportunities for strategic investment, with pricing strategies holding the key to success.</li>
<li>Investors, seeking value and consistency, anticipate potential opportunities in the evolving landscape.</li>
<li>As an improving asset in diminishing supply, their emphasis should remain on long-term gains.</li>
</ul>
Click below to download your free copy of our quarterly investment report.
&nbsp;

Q4 2023 Fine Wine Report & 2024 Outlook

<ul>
<li>The 2022 vintage boasts high quality and quantity – ‘the largest crop in 23 years’. </li>
<li>It is being launched in a downward market, following ten months of consistent price declines.</li>
<li>As demand has tempered and stock has (re-)entered the market, the success of the upcoming releases will largely depend on pricing. </li>
</ul>
Burgundy’s 2022 vintage is being launched in a downward market, following ten months of consistent price declines. The success of the upcoming releases will largely depend on pricing, but will its quality and quantity have the potential to turn the tables?
<h2>Critical opinions on Burgundy 2022</h2>
Critic reports thus far have been overwhelmingly positive, applauding both the quality and the quantity of the vintage. 2022 marks the largest crop in 23 years, with some producers seeing double the yields of the previous year. According to Matthew Hayes (<a href="https://www.jancisrobinson.com/articles/cote-dor-2022-overview">JancisRobinson.com</a>), ‘across the whole of Burgundy, 2022 offered a whopping 75.4% more wine (red, white and crémant) compared with 2021’.
Contrary to expectations, the vintage produced wines with typicity, purity, and freshness despite the extreme weather. Hayes commented that ‘2022 was the second-hottest year that the Côte d’Or has endured this century and should logically have followed in the footsteps of the equally stifling solaire years of 2019 and 2020, producing wines with rich, deep fruit profiles and vibrant acidities to ensure long life but […] the wines show a generally impeccable balance of tidy, ripe fruit, discreet acidity and equally (and mostly) refined tannins’.
Hayes revealed that ‘the best-sited and best-rooted vines appeared to have coped well with the heat and in the Côte d’Or the excellence of the top premiers and grands crus shines clearly’.
The prevailing opinion is that 2022 is an excellent year for white wines, reminiscent of 2017 and 2020. Meanwhile, tasting notes from the Côte de Beaune and Côte de Nuits highlighted dense red wines with well-integrated tannins, simultaneously offering elegance and concentration. The wines are expected to be approachable in youth but with significant ageing potential.
However, the market onto which they are released is just as important as the releases themselves.
<h2>The current market for Burgundy</h2>
In October 2022, the Liv-ex Burgundy 150 index reached an unprecedented peak, marking a staggering 809.4% increase since its inception in December 2003. Twenty years later, Burgundy remains the best-performing fine wine region.
However, since its peak, prices have tumbled 17.4%. This decline has been attributed to various macroeconomic factors that led to a shift in investor sentiment. As the economic landscape became more uncertain, fine wine buyers have grown increasingly risk-averse, causing a contraction in demand for more volatile investments.
This trend was particularly pronounced in Burgundy, which had soared too high across the whole spectrum. At these stratospheric prices, the market saw more sellers than buyers, with investors keen to liquidate their stock. Top-tier Burgundy (re-)entered the market as sellers were looking to make gains.
This perception of increased risk and a preference for stability among investors led to a decrease in Burgundy&#8217;s trade share by value. The falling prices further exacerbated this trend.
<img loading="lazy" decoding="async" class="alignnone wp-image-1836" src="https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-375x260.png" alt="Burgundy fine wine prices" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2024/01/Burgundy-150-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
The market conditions present a challenging backdrop for the high-quality high-quantity Burgundy 2022 En Primeur campaign. Will the excitement of the new be enough to stimulate demand?
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Burgundy 2022: a promising vintage in a challenging market

<ul>
<li>31% of Brits are setting resolutions to organise their finances in the new year.</li>
<li>One of the most talked-about investments – cryptocurrency – attracts with the potential for high returns but also carries high risk. </li>
<li>Offering smoothness and stability, fine wine can balance crypto volatility. </li>
</ul>
As we welcome in the new year, <a href="https://www.forbes.com/uk/advisor/life-insurance/new-years-resolution-statistics/">31% of Brits</a> are setting resolutions to organise their finances. For many this will mean investing. But where should they invest? And how risky is too risky?
In this article, we dive into one of the most talked-about high-risk investments – cryptocurrency. We explore the pitfalls and what investors can do to mitigate them. We also look at how fine wine – our favourite asset – can complement volatile investments like crypto to help smooth overall performances.
<h2>11,000 cryptocurrencies&#8230; and counting</h2>
Most people are familiar with Bitcoin and Ethereum, the two most popular digital coins. However, there are nearly 11,000 cryptocurrencies, with more issued every day. Some are eye-wateringly volatile. At the time of writing, for example, <a href="https://finance.yahoo.com/quote/KILT-USD">KILT-USD has jumped nearly 25%</a> in just three months. Meanwhile, others are much steadier.
StableCoins are considered the sturdiest as their market value is pegged to mainstream fiat currencies like the US dollar. This means that their worth should – in theory – be the same as the everyday money in our wallets. But the reality can be different.
<h2>StableCoins and de-pegging events</h2>
Even the most trusted StableCoins – Tether, USD Coin, Multi-Collateral Dai, Binance and USDP dollar – stray away from the dollar value from time to time, known as ‘de-pegging’.
<a href="https://www.spglobal.com/en/research-insights/featured/special-editorial/stablecoins-a-deep-dive-into-valuation-and-depegging">SPGlobal </a>identified 13 core triggers: market volatility, liquidity stress, reserve impairments, mismanagement, demand and supply imbalances, loss of investor confidence, competitor performance, design flaws, hacking, operational risk, limited adoption, regulatory uncertainty and market events can all de-peg StableCoins, leading to erratic and volatile performances.
<h2>Risk and return profile of StableCoins</h2>
StableCoins are full of promise, but they are also incredibly young. The oldest StableCoin, Tether, is just nine years old. Although regulators are scrambling to offer investors more security, they are still some way off.
Buying asset classes before they have matured presents both risks and opportunities. Higher risk opens the door for higher rewards, but when things go wrong, the fall-out can be fatal. Famously, in May 2022, Terra&#8217;s StableCoin crashed dramatically, <a href="https://www.coindesk.com/markets/2023/02/20/retail-crypto-investors-in-emerging-economies-hit-hardest-by-ftx-terra-collapses-bis/#:~:text=The%20crypto%20market%20lost%20more,in%20November%2C%20the%20report%20said.">costing investors $450+ billion</a>. Shortly after came FTX fall, plummeting a further $200+ billion. The aftermath left thousands of investors badly out of pocket with little to no regulatory protection.
For years, regulators like the FCA have been warning investors not to invest too much in crypto, as <a href="https://nypost.com/2022/05/23/investors-lose-big-in-crypto-crash-i-didnt-sleep-for-days/">worrying surges of people</a> lose their entire life savings to this digital asset.
<h2>A dire need for diversification</h2>
To avoid losing everything in one sweep, investors should spread their money across assets with distinctive characteristics and revenue streams. This process, known as <a href="https://winecap.com/learn/fine-wine-investment-diversification">diversification</a>, means the gains from some investments cancel out the loses from others.
Without personal financial advice, it is impossible to say how much of a portfolio should be invested in crypto. However, as a rule, experts have <a href="https://www.marketwatch.com/picks/look-at-it-like-youre-a-gambler-walking-into-a-casino-heres-exactly-how-much-of-your-nest-egg-financial-pros-say-should-be-invested-in-crypto-01638883573">warned against investing more than 5% of wealth</a>. Some even cap the limit at 2%.
Similarly, investors should probably limit other risky assets too. Meme stocks, commodities, derivatives or trending collectibles can all derail a portfolio if they make up more than 10%.
<h2>Pairing fine wine and crypto</h2>
Unlike digital assets, <a href="https://winecap.com/learn/the-rise-of-fine-wine-as-a-stable-and-sustainable-investment">fine wine moves slowly but surely</a>. Since the end of 2003, <a href="https://www.liv-ex.com/news-insights/indices/">the performance of the top 1000 fine wines</a> (according to the Liv-ex 1000 index) has crept little-by-little up by a whopping 315%. But since the rise is smooth and gradual, it does not feel volatile or erratic.
Month-on-month the average fine wine index value rarely changes by more than 5%. By contrast, between the 25th of September and the 25th of October alone, Bitcoin fluctuated by over 30%.
These properties could make fine wine an excellent partner for crypto assets, like StableCoin. The steadfastness of fine wine can help to slow and flatten the rollercoaster effect of crypto has on a portfolio.
<h2>Contrasting sources of value</h2>
Aside from smoothing volatility, there are other reasons why fine wine could pair well with crypto. One of the strongest is the value source.
Crypto is not backed by a real asset. Some experts argue that the energy used to create a coin is its value. But it is generally agreed that the value of crypto comes from the wider market and the potential that others see in it. So, when the market is in turmoil, prices plummet.
By contrast, fine wine gains its value intrinsically. Put simply, the premise of wine investment is that as fine wine ages, its quality improves, and prices rise. The market operates with its own dynamics based on vintage quality, scarcity and global demand. Whether it&#8217;s bullish, bearish or something else, fine wine is still treasured and sought-after.
In this respect, crypto and fine wine investments could pair beautifully. Fine wine offers smoothness and stability. Meanwhile, crypto offers investors higher risk-reward potential and quick liquidity.
<h2>Investing responsibly</h2>
StableCoins are surging in popularity. Governments, institutional investors and regulators all dipped their toes into crypto over the past months, indicating that further expansion could be around the corner.
This might lead to more growing pains and continued volatility. For those who chose to invest in this young asset, diversification is crucial. Examples of assets which are less affected by the stock market include property, gold or fine wine. We feel that the characteristics of fine wine pair especially well with crypto, helping investors to hedge against volatility risk and smoothen their overall performances.
If you would like to talk to us about investing in fine wine, <a href="https://winecap.com/start-investing">we&#8217;re just a few clicks away.</a>

Can fine wine investment balance crypto volatility?

<ul>
<li>There is an overlap between sustainable and fine wine investors as both share a long-term vision and increasingly similar demographics.</li>
<li>56% of investors are attracted to fine wine because it is a sustainable asset class with a low carbon footprint.</li>
<li>Environmental, social and financial sustainability is one of the five characteristics that distinguishes fine wine from other beverages.</li>
</ul>
This is the third part of our &#8216;Fine wine sustainability report&#8217;. See also <a href="https://winecap.com/learn/fine-wine-sustainability-report-part-i-how-is-fine-wine-sustainable">part I &#8211; how is fine wine sustainable</a> and <a href="https://winecap.com/learn/fine-wine-sustainability-report-part-ii-how-can-fine-wine-mitigate-risk-in-a-sustainable-portfolio">part II &#8211; how can fine wine mitigate risk in a sustainable portfolio</a>. 
There is already some cross-over between sustainable and fine wine investors. The demographics are getting closer all the time.
The most active sustainable investors today are <a href="https://scholarship.law.bu.edu/cgi/viewcontent.cgi?article=1973&amp;context=faculty_scholarship">millennials</a> (the group currently aged between 27 and 42). More specifically, the majority of them are <a href="https://www.sc.com/en/grow-your-wealth/what-five-personas-reveal-about-barriers-in-esg-investing/">entrepreneurs and legacy builders</a>. Likewise, within the world of fine wine, research from Sotheby&#8217;s in 2022 found that <a href="https://www.sothebys.com/en/docs/pdf/wine-spirits-market-report-2022.pdf">35% of new buyers</a> are under the age of forty. This is the second consecutive year of millennials betting on fine wine as the figure hit<a href="https://www.sothebys.com/en/docs/pdf/jk-22907254-feb-2022-wine-market-report-2021-final.pdf"> 37% in 2021</a>.
Fine wine investments can take around ten years to mature, but often take longer to reach scarcity returns. This means that most investors are collecting long-term legacy assets, just like many sustainable investors. The overlap that already exists between ambitious sustainable and fine wine investors is promising. We believe it will continue to grow for the future.
There is already a burgeoning movement of sustainable investors buying fine wine. Our <a href="https://winecap.com/learn/uk-wine-investment-report">2023 survey</a> found that 56% of investors are attracted to fine wine because it is a sustainable asset class with a low carbon footprint. Although fine wine has many investment qualities, we believe that the best-suited sustainable investors are those who are looking to hedge against volatility or inflation risks over the long-term. Some investors have religious or personal barriers to investing in fine wine, and in this situation, the asset may not be suitable.
<h2>An insatiable passion for change</h2>
Is there any industry more determined to adapt and mitigate against the climate crisis than fine wine? The dogged and ruthless determination of winemakers is as inspirational as it is impressive. With floods, forest fires and droughts ripping through the planet, we need every innovation from every industry. Nothing should be discounted. And sustainable investors should be given every possible opportunity to mitigate against risks.
The fine wine industry is rapidly evolving its stance on the planet, with biodiversity, climate adaption and mitigation taking centre stage. <a href="https://www.meiningers-international.com/wine/general/it-time-re-think-fine-wine">Environmental, social and financial sustainability</a> is one of the five characteristics that distinguishes fine wine from other beverages. It is now a defining feature at the heart of every vineyard, nestled in every bottle. What’s more, the <a href="https://sustainablewine.co.uk/launch-of-the-swr-global-reference-framework/">Sustainable Wine Roundtable</a> launched a framework for identifying and categorising sustainability in wine in 2023. Now investors have more layers of security than ever before that their investment matches their ethics.
Depriving investors of fine wine would not just leave inflation and stability gaps in portfolios, it would undermine the vital work of an evolving industry. As powerful as it is passionate, this is an asset that packs a seriously low-carbon punch in sustainable portfolios.
“A fine wine is complex, balance, with a potential to age – though highly drinkable at every state of its development. It has the capacity to provoke emotions and wonder in the one drinking it, while reflecting the expression of truth intended by its maker. It is widely recognized, while being environmentally, socially and financially sustainable.”
<a href="https://areni.global/publications/rethinking-fine-wine-defining-fine-wine-and-its-responsibilities-to-protect-its-future/">Areni</a>

Fine wine sustainability report (Part III): profiling the sustainable investor

<ul>
<li>The second part of our report focuses on how fine wine can mitigate risk for sustainable investors.</li>
<li>By blending sustainability-linked bonds with fine wine, investors can shield some of their wealth from inflation while having access to a regular income stream.</li>
<li>The steadiness of fine wine can help to smooth out the overall performance of sustainable portfolios, hedging against the volatility risks of impact investments. </li>
</ul>
Fine wine has many qualities that make it an environmentally and socially sustainable asset, as discussed in the f<a href="https://winecap.com/learn/fine-wine-sustainability-report-part-i-how-is-fine-wine-sustainable">irst part of this report</a>. And we believe that it can offer even more value as a hedge for sustainable portfolios. Just as with traditional investing, each investor is different. However, there will be some common themes and risks. In this section, we analyse how fine wine interacts with some of the most popular sustainable investments, and where the assets can become greater than the sum of their parts.
<h2>Sustainability-linked bonds</h2>
For businesses to become sustainable, they will usually need to pay for new infrastructure. This is where bonds come in. Investors finance the projects and receive a regular income from the repayments and interest (known as coupons) over a set period of time. There are many examples of corporate and sovereign green bonds, but probably the most impactful is Orsted.
In 2017, Orsted raised 1.25 billion euros from investors to successfully transition from brown to green energy. The bonds last until 2029. Since then, Orsted has been named the world’s most sustainable company. Today <a href="https://orstedcdn.azureedge.net/-/media/2022-annual-report/orsted-sustainability-report-2022.pdf?rev=eda5465ba5784866b6cea99e58088f94&amp;hash=3BFD5F72E676043FA33114647E7C8C4D">91% of the energy</a> it creates comes from renewable sources. The aim is to be at 99% by 2025. For context, worldwide this accounts for <a href="https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/energy-economics/statistical-review/bp-stats-review-2022-full-report.pdf">just 13% of energy</a>. Orsted has also just released a blue bond, which focuses on marine life and oceans.
Sustainability-linked bonds can be built around society as well as the environment. <a href="https://www.gsam.com/content/gsam/uk/en/institutions/about-gsam/news-and-media/2023/social-bonds-survey.html">Research by Goldman Sachs</a> found 65% of investors are interested in social bonds, with 29% already invested.
Bonds are a good and relatively low-risk way for investors to generate an income while doing good. But there are some downsides. The main issue is that as bonds set a fixed repayment schedule years – sometimes decades – in advance, inflation can reduce the purchasing power of the income over time. In a usual market environment, central banks aim to keep inflation levels to around 2% or under, which is priced into the bond. However, in recent years, it has shot up to double digits. This can slash real returns for investors, and potentially put them off green bonds.
We believe that fine wine can help to hedge against the inflation risk of sustainability-linked bonds. The two assets complement each other well, as fine wine is less liquid but inflation resistant. By blending bonds with fine wine, investors can shield some of their wealth from inflation while having access to a regular income stream.
<h2>Impact investments</h2>
There are some businesses and organisations that make a clear and measurable change, while delivering returns for investors. Some environmental examples include investments in sustainable waste management, building renewable energy plants or businesses producing meat alternatives. There are also social movements; for example, venture capitalist firms investing in women and people of colour, affordable housing developers or accessible childcare services. When investments make tangible improvements, they are usually known as impact investments (because they make an impact).
While impact investments can be almost any asset class or risk level, in general they tend to be on the riskier side. By their nature, they are usually fairly new ventures, and can also be subject to incoming regulations. This could mean that the stocks spring and plunge, making sustainable investors nervous.
Fine wine, by contrast, is a low-risk asset with little volatility. We feel that the steadiness of fine wine can help to smooth out the overall performance of sustainable portfolios, hedging against the volatility risks of impact investments.
<h2>Overall positioning in a portfolio</h2>
Fine wine should not be the star of the show, but more of a supporting act. It is often best placed as a hedge against other sustainable or impactful assets, especially those with inflation or volatility risks. Generally, wealth managers and investors keep fine wine allocations under 10% of the total portfolio.
<h3>Stay tuned for Part III &#8211; profiling the sustainable investor.</h3>

Fine wine sustainability report (Part II): how can fine wine mitigate risk in a sustainable portfolio?

<ul>
<li>Fine wine offers a sustainable investment option, which is increasingly recognised by wealth managers.</li>
<li>The industry is proactively adapting to climate change, with practices like regenerative farming and reducing bottle weight. </li>
<li>Fine wine&#8217;s focus on social sustainability, including worker welfare and community support, boosts its appeal as a sustainable investment choice, aligning with modern ESG criteria.</li>
</ul>
Floods, fires and famine are no longer on our doorstep, they have already crossed the threshold into normality. In the first eight months of 2023 alone, the USA suffered <a href="https://www.ncei.noaa.gov/access/billions/#:~:text=In%202023%20(as%20of%20November,and%201%20winter%20storm%20event.">23 separate billion-dollar climate disasters</a>. Research shows that by 2050, floods in Europe <a href="https://www.eea.europa.eu/highlights/floodplain-management-reducing-flood-risks">will increase five-fold</a>.
Alongside climate disaster comes human suffering, ever-growing wealth gaps and loss of livelihoods. The homes of indigenous tribes are <a href="https://www.hrw.org/report/2023/07/10/our-trust-broken/loss-land-and-livelihoods-oil-development-uganda">deforested to clear space for oil drilling</a>. The most vulnerable find their <a href="https://news.un.org/en/story/2023/09/1141587">communities and businesses flooded</a>. Meanwhile, <a href="https://www.imf.org/en/Publications/fandd/issues/2021/09/climate-change-and-inequality-guivarch-mejean-taconet">social inequality rachets up</a> with poor climate policies.
Investors are all too aware of the damage. A <a href="https://corpgov.law.harvard.edu/2023/07/26/2023-sustainable-investment-survey/">2023 study by Harvard</a> found 85% ask their advisors about sustainable investments. While some groups – particularly <a href="https://scholarship.law.bu.edu/cgi/viewcontent.cgi?article=1973&amp;context=faculty_scholarship">millennials</a> – have become activists themselves, using their shareholder votes to force change. So where does fine wine come into this?
Although ethical investing has been around for centuries, climate-focused sustainable investing is strikingly new. The insatiable demand we see today is less than a decade old. Between 2016 and 2020 alone, sustainable investing in Europe, USA, Canada, Australasia, and Japan <a href="https://onlinelibrary.wiley.com/doi/full/10.1002/sd.2422">swelled by 55%</a>. Even though it is a multi-trillion industry, ‘Sustainable Investment’ still doesn’t even have a definition in most parts of the world. Because of this, the movement has borrowed a lot from pre-existing rules, which were mostly religious.
For centuries, our sustainable investment has been built on the foundations of Quaker and Methodist beliefs. This explains why alcohol, or to quote <a href="https://christianhistoryinstitute.org/magazine/article/wesleys-sermon-use-of-money">John Wesley ‘that liquid fire’</a> has been prohibited from almost all ESG (environmental, social, governance) funds – even when <a href="https://www.hdinvestmentcontent.com/post/5-vice-fund-companies-in-esg-investments">fossil fuel producers, fast fashion and plastic polluters</a> made it on the list.
However, we believe this is a mistake. Fine wine offers extraordinary sustainable benefits to investors, especially when it comes to balancing out the risks of green bonds and risky impact investments. Not only does fine wine contribute to a greener future (it is a natural product after all), but this asset class can also plug vital strategic gaps, giving sustainable investors even more confidence. The time has come to give fine wine the credit it deserves.
<h2>How is fine wine sustainable?</h2>
While there is no universal definition of a ‘Sustainable Investment’, the European Union has made significant headway. According to the <a href="https://finance.ec.europa.eu/sustainable-finance/tools-and-standards/eu-taxonomy-sustainable-activities_en">EU taxonomy</a>, an environmentally sustainable investment must contribute significantly to one of the following, without jeopardising the others;
<ul>
<li>Climate change mitigation</li>
<li>Climate change adaption</li>
<li>Sustainable use and protection of water and marine resources</li>
<li>Transition to a circular economy</li>
<li>Pollution prevention and control</li>
<li>Protection and restoration of biodiversity</li>
</ul>
We believe that fine wine not only meets this criterion but exceeds it. Vineyards rely on a stable climate, fertile soil and regenerative farming. From using <a href="https://www.youtube.com/watch?v=nRx1yeIQgAM&amp;ab_channel=ShawnP.Mitchell">free range ducks</a> and <a href="https://tablascreek.typepad.com/tablas/2017/02/tablas-creek-lambs-and-tablas-creek-lamb.html">sheep</a> instead of pesticides to replacing heavy glass with lighter alternatives, the environmental innovations in the wine industry are never-ending.
<h2>Climate change mitigation and circular economies</h2>
To secure a safer future, every efficiency counts. The most carbon-intensive part of fine wine production is making and transporting the heavy glass bottles that contain the wine. According to <a href="https://sustainablewine.co.uk/wp-content/uploads/2023/09/SWR-Report-Reducing-Wine-Bottle-Weight-2023.pdf">one Sustainable Wine Roundtable report</a>, this accounts for over half of the total environmental impact of wine. Simply by reducing the bottles from 550g to 420g would cut 25% of carbon emissions.
Although dense packaging has long-been associated with quality, European fine wine producers are throwing themselves into this trend. Burgundy producer, Albert Bichot, for example has <a href="https://www.jancisrobinson.com/articles/retailers-agree-reduce-bottle-weights">reduced the bottle weight from 700-750g to 450g.</a> According to one interview, the producer also uses only <a href="https://www.forbes.com/sites/lizthach/2023/05/31/burgundy-wine-powerhouse-albert-bichot-goes-100-organic-and-reduces-bottle-weight/?sh=5a8d7e6a5983">recycled glass and biodegradable labels</a>. Even Champagne – which typically uses thicker glass – is experimenting. Bollinger, for example, is committed to a <a href="https://www.champagne-bollinger.com/en/sustainability/">7% reduction in bottle weight</a> by 2029, as well as to use only recycled and recyclable materials.
Another area for improvement is energy efficiency throughout the manufacturing process. Here, fine wine has achieved far more than other industries. Almost every fine wine producer we could find has taken significant steps to reduce emissions dramatically. One of our favourite examples is <a href="https://saornellaiastatic.blob.core.windows.net/media/Ornellaia_e_Masseto_Sustainability_Report_EN.pdf">Ornellaia.</a> 2022 saw this winery slash liquefied petroleum gases usage by 98% with biomass heat. Today the entire firm uses the equivalent of 5% of the average family of four household over a year. Ornellaia has also blended nature with technology by installing a Building Management System to ensure that the temperature is efficiently set.
<h2>Climate change adaption, sustainable use of water and protection of biodiversity</h2>
World-famous flavours are at risk from climate change. As <a href="https://www.champagne.fr/en/the-commitments-in-champagne/our-commitments/carbon-footprint">Comité Champagne report</a>, temperatures are now 1.8 degrees higher than in the 1980s, meaning grapes are at risk of bursting prematurely or drying out. They now need to be picked thirty days earlier, potentially cutting the characteristic tastes short. Fine wine producers have been rigorousness and brave, proactively innovating in the face of the climate crisis. Not only do these innovations help cool down and protect the precious vines, but they also offer investors significant environmental benefits too.
One of the most widespread practices in fine wine vineyards now is the use of regenerative farming. Rather than using typical organic practices, which can still harm pollinators, producers are leaning into nature. <a href="https://www.forbes.com/sites/lizthach/2023/11/30/why-la-crema-winery-employs-sheep-in-the-vineyard-that-dislike-grapes/?sh=7333f7582b54">Sheep roam around some vineyards</a> picking off bugs organically, and often, <a href="https://www.theguardian.com/environment/2021/jun/28/draught-wines-french-vineyards-rediscover-the-power-of-horses">horses are put to work instead of tractors</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1814" src="https://wp.winecap.com/wp-content/uploads/2023/12/Horses-at-pontet-canet-375x192.jpg" alt="Sustainability at Pontet Canet" width="800" height="410" srcset="https://wp.winecap.com/wp-content/uploads/2023/12/Horses-at-pontet-canet-375x192.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/12/Horses-at-pontet-canet-768x394.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/12/Horses-at-pontet-canet.jpg 975w" sizes="(max-width: 800px) 100vw, 800px" />
Significantly, many fine wine producers such as <a href="https://www.tellerreport.com/news/2021-06-16-ch%C3%A2teau-cheval-blanc-plants-hundreds-of-trees-in-its-legendary-vines---france-24.B1lWj93Pi_.html">Château Cheval Blanc</a> plant diverse fruit and forestry trees between the vines. This helps to shade the grapes, sequester carbon and provide homes for vital pollinators. The fungus which grows around the roots of the trees also soaks up water, acting as a pump, pushing nutrients into the vines.
Water irrigation is one of the hottest topics for today’s fine wine producers, with many now working with their natural landscapes to find the best solutions. Vineyards are increasingly planting or <a href="https://www.thedrinksbusiness.com/2023/08/why-regenerative-viticulture-is-gaining-ground-among-major-wine-producers/">shifting vines along the contours of the land</a>, to prevent run-off during heavy rainfalls. They are also <a href="https://www.thedrinksbusiness.com/2023/08/why-regenerative-viticulture-is-gaining-ground-among-major-wine-producers/">adding ground covers</a> to prevent evaporation, keeping the soil damper and more nutritious.
The adaptions are coming thick and fast, as <a href="https://www.decanter.com/wine-news/bordeaux-new-wine-grapes-419730/">vineyards experiment with new grapes,</a> and alternative locations. Northern France, the UK and Germany are fast becoming viable options for fine wine in this new climate, with producers are always one step ahead of the curve.
<h2>Social sustainability</h2>
Sustainability is about more than preserving the environment. It is also about protecting workers and supporting local communities. Although the fine wine industry is not as advanced in this area as it is with environmental sustainability, frameworks and strong voices are beginning to emerge. As <a href="https://www.wineenthusiast.com/culture/wine/wine-sustainable-diversity-future/">one wine producer puts it</a>:
‘Do we farm organically because it’s better for the environment? Certainly. Do we farm organically because it makes better-tasting wine? Without question. But the most important reason to farm organically is because the lives of the people who work in the vineyards, and the people who live downstream, matter.’
Caring for the environment and biodiversity also has far-reaching effects on local life. Vineyards continue to play a vital role in the culture and traditions of their local communities. Recently the <a href="https://www.champagne.fr/en/additional-information/media/champagne-press/champagne-winegrowers-and-houses-propose-tangible">Comité Champagne proposed a series of tangible solutions</a> to improve the lives of the region’s 120,000 harvest workers. We are also seeing a general trend of permanent contracts for employees, as well as a sharp focus on improving diversity at board levels. While there is certainly work to be done in this space, the general trajectory looks promising.
<h3>Stay tuned for Part II of our Fine Wine Sustainability Report, in which we discuss how fine wine can mitigate risk in sustainable portfolios &#8211; coming next week. </h3>

Fine wine sustainability report (Part I): how is fine wine sustainable?

<ul>
<li>2023 marks a notable slowdown in the fine wine market, with price corrections shadowing the bullish trends of previous years. </li>
<li>Burgundy and Champagne which led the market to its peak in 2022 are suffering the most.</li>
<li>Bordeaux has become a beacon for investors, gaining renewed interest due to its stability and reliability. </li>
</ul>
As the <a href="https://www.liv-ex.com/2023/11/2023-liv-ex-power-100-gimme-shelter-2/">2023 Liv-ex Power 100</a> unveils, a significant shift is evident in the fine wine market. This year marks a notable slowdown, with price corrections shadowing the bullish trends of previous years. Amidst this changing landscape, Bordeaux emerges as a beacon for investors, gaining renewed interest due to its stability and reliability. This article delves into the dynamics of the 2023 fine wine market, highlighting the rise of Bordeaux against a backdrop of global risk aversion.
<h2>Understanding the 2023 market slowdown</h2>
The fine wine market in 2023 has departed from the spirited activity of past years. After prices across many regions reached stellar levels in 2022, 2023 was a year of corrections. Trade by value and volume also fell, according to the 2023 Liv-ex Power 100 report. Despite more wine labels being traded, the overall number of individual wines traded (on a vintage level) has seen a decrease. This trend points towards a strategic shift towards higher quality wine investments, reflecting a more discerning market behaviour.
The softening of the fine wine market in 2023 can be attributed to a range of factors. Economic uncertainties and global financial market fluctuations have instilled a sense of risk aversion among investors. Inflationary pressures and rising interest rates have also played a role, impacting disposable incomes and investment capabilities. This economic climate has prompted a more cautious approach in luxury investments like fine wine. Additionally, changing consumer behaviours and preferences, along with geopolitical tensions and trade disputes, have further contributed to the market&#8217;s softening.
<h2>Regional patterns in 2023</h2>
In 2023, regional patterns in the wine market have become more pronounced. Burgundy and Champagne, which previously led the market to its peak, are now facing significant corrections. Burgundy has seen a reduction in its presence in the Power 100, while the Burgundy 150 index has fallen 15.4% year-on-year. Similarly, Champagne&#8217;s market has also softened, with the Champagne 50 index dipping 19.4%.
The rankings reveal a trend towards stability, liquidity, and relative value, which are prominently found in Bordeaux. This region has emerged as a beacon of resilience in the fine wine market, adding five wines to the Power 100 and benefiting from its reputation for consistent quality and reliable investment.
Conversely, California, while losing five wines in the ranking, managed to maintain its trade share, indicating a selective but sustained interest in its wines. This shift reflects a broader market inclination towards established regions and brands, suggesting a cautious approach by collectors and investors in a turbulent market.
As market dynamics evolve, regions like Italy and Spain are gaining traction, with brands like Vietti and Dominio de Pingus showing positive growth, further diversifying the landscape of investment-worthy wines. These regions are increasingly seen as offering valuable investment-worthy wines, attracting attention for their unique qualities and potential for growth.
<h2>The most powerful brands of 2023</h2>
In the realm of individual brands, certain names have demonstrated remarkable resilience and adaptability amidst the market downturn. Bordeaux&#8217;s Château Climens, for instance, has made an impressive leap in the rankings, rising from 353rd place in 2022 to 98th this year. This is a testament to its successful brand repositioning under new ownership.
Similarly, in California, brands like Opus One and Screaming Eagle continue to hold strong positions. Opus One, in particular, has risen dramatically, from 82nd in 2022 to 4th this year, signifying continued interest in top-tier wines from this region despite broader market challenges.
Despite facing a pullback Burgundy still has powerful players like Kei Shiogai, which took the top spot in terms of price performance, with its Market Price rising 185.7% year-on-year.
The strength of these brands lies not just in their historical significance or quality but also in their ability to retain high liquidity and trading volumes, essential in a market that is increasingly focusing on safer investments. This trend suggests that while the market is retracting in some areas, there remains a robust demand for wines that represent the pinnacle of their respective regions.
<h2>Adapting to the evolving wine market dynamics</h2>
As we navigate through the evolving dynamics of the fine wine market, it is clear that understanding and adapting to these changes is crucial for future investing. The trends of 2023, from the renewed interest in Bordeaux and the resilience of powerful brands, provide valuable insights into the market&#8217;s direction.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

Navigating the 2023 fine wine market: the rise of Bordeaux amid global risk aversion

<ul>
<li>This Friday will see the artist label announcement of Château Mouton Rothschild’s 2021 vintage. </li>
<li>Over the last ten vintages, the average price increase in the month following the announcement has been 5%, signalling a potential investment opportunity.</li>
<li>The 2000 vintage illustrates the power of the special label, perfectly weathering market downturns.</li>
</ul>
Every year, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/mouton-rothschild">Château Mouton Rothschild</a> commissions a different artist to produce the label for their Grand Vin. The tradition began in 1945 when Baron Philippe de Rothschild decided to celebrate the end of World War II by creating a special label featuring a &#8216;V&#8217; for victory, designed by Philippe Jullian. Since then, the list of alumni has included the likes of Salvador Dalí, Pablo Picasso, Joan Miró, Andy Warhol, David Hockney, Jeff Koons, Anish Kapoor, Lucien Freud, and Wassily Kandinsky. This Friday will see the label reveal of the 2021 vintage.
<h2>How has the label announcement impacted prices?</h2>
Over the years, this innovative approach has turned the Mouton Rothschild labels into a fusion of fine art and fine wine, making each bottle a highly desirable collector’s item. What’s more, prices for Mouton Rothschild have consistently increased in the month following the announcement.
The increase averages just under 5% over the last ten vintages. The 2012 vintage, with a label by Miquel Barcelo, rose the most, up 14.9%, followed by the Xu Bing’s 2018, up 12.6%. Last year’s label reveal of the 2020 vintage drove prices 8.6% higher in a month. There has been only one exception to this pattern with the 2015 vintage, down 4.3%. However, the wine is still up 11% since release.
In the last decade, prices for the brand, represented by <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/mouton-rothschild">our Mouton Rothschild index</a>, have risen 44% on average.
<h2>Which are the best value labels today?</h2>
While there is a strong investment case for the Grand Vin, which vintages offer the best value today? The 2020 boasts 100-points from <a href="https://www.robertparker.com/">The Wine Advocate</a> and is 13% cheaper than the other 100-point 2016 vintage. Its price rose 8.6% after the label announcement, which was designed by <a href="https://www.chateau-mouton-rothschild.com/label-art/discover-the-artwork/peter-doig">Peter Doig</a>.
The 2021 is the most affordable recent release with a current Market Price of £4,400 per 12&#215;75. However, given the trend of price rises post-announcement, one can expect potential changes.
Otherwise, buyers might wish to look back at the 2019 vintage, which received 100-points from Lisa Perrotti-Brown MW (<a href="https://thewineindependent.com/">The Wine Independent</a>) and 97 points from Neal Martin (<a href="https://vinous.com/">Vinous</a>). The wine’s label, ‘The solar iris of Mouton’, was created by <a href="https://www.chateau-mouton-rothschild.com/label-art/discover-the-artwork/olafur-eliasson">Olafur Eliasson</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1806" src="https://wp.winecap.com/wp-content/uploads/2023/11/EP-Socials-LinkedInAll-1-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/EP-Socials-LinkedInAll-1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/11/EP-Socials-LinkedInAll-1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/11/EP-Socials-LinkedInAll-1.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>The case of the 2000 vintage</h2>
If there is one special bottle that illustrates the power of art driving prices, it is that of the 2000 vintage. The bottle itself features an intricate gold engraving of the famous ram (Mouton) of the Rothschild coat of arms and stands out for its elegance and symbolic significance.
Mouton Rothschild 2000 weathered the Bordeaux market downturn of 2011-2014, when prices for the other First Growths fell sharply. The label continued to enjoy heightened demand in the Asian market, which only increased in 2015 – the year of the sheep, according to the Chinese zodiac. The wine has risen close to 750% in value since its release – an investment case that speaks for itself.
The innovative tradition of artist-designed labels by Château Mouton Rothschild not only merges the worlds of fine art and winemaking but also significantly elevates the market value, making them coveted treasures for collectors and investors alike.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The impact of Mouton Rothschild’s artist labels on market value

Our latest report, 2023’s big investment themes: fine wine and beyond, has now been released. The report looks at the key themes that defined markets this year, from interest rates to sustainability. It positions fine wine within a broader investment context and analyses the key events that influenced its performance.
<h2>Report highlights:</h2>
<ul>
<li>Tech, interest, and sustainability came to define markets in 2023.</li>
<li>The stock market bounced back, and technology stocks rallied as the world became fascinated with generative AI.</li>
<li>In a bid to cool down the red-hot inflation levels, the Bank of England cranked up interest rates 14 times.</li>
<li>As central banks increased interest rates, they also began to stockpile gold.</li>
<li>In the UK, interest rates reached the highest point since 1998. This signalled an end to the era of cheap borrowing, which could limit growth for some economies.</li>
<li>2023 saw the rush of demand for green bonds – borrowing money to finance sustainable projects.</li>
<li>Sustainability drove fine wine demand among investors and led to other positive developments in the wine industry.</li>
</ul>
&nbsp;

Special report – 2023’s big investment themes: fine wine and beyond

<ul>
<li>We compare the price performance of Château Lafite Rothschild to other regions’ respective ‘First Growths’.</li>
<li>The rising ratio highlights the increased value to be had in the Bordeaux First Growths.</li>
<li>Today, one can get 29 bottles of Lafite for the price of Romanée-Conti and almost five for Pétrus and Screaming Eagle.</li>
</ul>
How many bottles of Château Lafite Rothschild can one get for the price of other regions’ respective ‘First’ wines?
With <a href="https://winecap.com/learn/the-place-of-the-bordeaux-first-growths-in-a-changing-fine-wine-market">changing market dynamics</a> at play that have seen the balance between Bordeaux and other regions change, we examine the price ratio between some of the most popular investment-grade wines.
Below we compare the performance of the Bordeaux First Growth <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/lafite-rothschild">Château Lafite Rothschild</a> to Burgundy’s highest echelon Domaine de la Romanée-Conti, the Super Tuscan Sassicaia, the Right Bank Château Pétrus, the Californian cult wine Screaming Eagle, and the most in-demand Champagne, Dom Pérignon. These are all wines that symbolise and even transcend their geography.  In the same way that Lafite has long been the mainstay of Bordeaux, the other wines are bellwethers for their regions.
The ratio between these wines is somewhat reflective of broader trends within their respective regions. Over the last decade, the ratio has risen consistently, highlighting the increased value to be had in the First Growths, as other regions gather momentum.
<h2>How many bottles of Lafite for the price of DRC? 
</h2>
<img loading="lazy" decoding="async" class="alignnone wp-image-1787" src="https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-Lafite-price-ratio-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
Today, one can get on average 29 bottles of Lafite Rothschild for the price of Romanée-Conti. The ratio has risen considerably since 2013 when one could buy just 14 bottles of Lafite for one DRC. It peaked in December 2022, when it stood at 30:1.
As the chart below shows, the Domaine de la Romanée-Conti index hit a record high in December last year. Meanwhile, the Lafite index has not seen any of the price volatility witnessed by DRC. Year-to-date, prices for both labels have dipped but the fall has been sharper for DRC.
<img loading="lazy" decoding="async" class="alignnone wp-image-1788" src="https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-375x269.png" width="800" height="573" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-375x269.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-768x550.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-1536x1100.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-2048x1467.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-1200x860.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/DRC-vs-Lafite-price-performance-1980x1418.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
The DRC:Lafite price ratio is somewhat reflective of broader trends within their regions. In the last decade, Burgundy emerged as Bordeaux’s main contender. After Bordeaux peaked at the end of the China-led bull market in 2011, buyers started to seek out other corners of the fine wine world and it was Burgundy that attracted the greatest attention. The allure of rarity and quality meant that demand quickly outstripped already tight supply. Prices for Burgundy peaked, while Bordeaux ran quietly in the background.
For Bordeaux, the period between 2013 and 2015 saw contraction at the tail end of the Chinese correction. The market turned again in October 2015, and since then, Lafite Rothschild has been the second-best-performing First Growth, with some vintages doubling in value. However, it has not managed to catch up with Burgundy’s stellar rise.
<h2>Left vs Right Bank</h2>
It is also interesting to compare performance within Bordeaux’s Left and Right Bank. Today 4.6 bottles of Lafite gets you a bottle of <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/petrus/petrus">Château Pétrus</a>, up from 3, ten years ago.
<img loading="lazy" decoding="async" class="alignnone wp-image-1790" src="https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-price-ratio-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
As the chart below shows, Lafite and Pétrus have followed a similar trajectory up to September 2021, when prices for the First Growth flattened while Pétrus continued its rise.
Similar to Burgundy, rarity plays a key role in Pétrus’ appeal and investment performance. Pétrus is produced in much smaller quantities (around 3,000 cases per year) compared to Lafite (around 25,000 cases). Despite commanding a higher price tag, the wine has considerably outperformed Lafite in the last decade.
<img loading="lazy" decoding="async" class="alignnone wp-image-1791" src="https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-375x269.png" width="800" height="573" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-375x269.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-768x550.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-1536x1100.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-2048x1467.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-1200x860.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Petrus-vs-Lafite-price-performance-1980x1418.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Dom Pérignon vs Lafite Rothschild</h2>
Recent years have seen a surge in Champagne’s market share and price performance. This has been reflected in the performance of its most traded label – <a href="https://winecap.com/wine-track/france/champagne/na/dom-perignon/dom-perignon">Dom Pérignon</a>.
Produced in much larger quantities than Lafite and more widely available, Dom Pérignon has started to catch up with the First Growth. In the last decade, the ratio between them has doubled – from 0.2 to 0.4.
<img loading="lazy" decoding="async" class="alignnone wp-image-1792" src="https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-price-ratio-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
Champagne prices, with Dom Pérignon at the helm, have made considerable gains since the early 2020s. In the last decade, our Dom Pérignon index is up 120%, compared to 20% for Lafite.
<img loading="lazy" decoding="async" class="alignnone wp-image-1793" src="https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-375x269.png" width="800" height="573" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-375x269.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-768x550.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-1536x1100.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-2048x1467.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-1200x860.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Dom-P-Price-performance-1980x1418.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Sassicaia vs Lafite Rothschild</h2>
Similarly, the Super Tuscans have been getting more expensive. The most liquid and heavily traded group of Italian wines, their performance has been further boosted by critical acclaim and brand strength, with <a href="https://winecap.com/wine-track/italy/tuscany/bolgheri/tenuta-san-guido/sassicaia">Sassicaia</a> at the helm.
The ratio between Sassicaia and Lafite has risen from 0.2 ten years ago to 0.42 today.
<img loading="lazy" decoding="async" class="alignnone wp-image-1794" src="https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-Lafite-price-ratio-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
As the chart below shows, Sassicaia has seen stable and consistent growth. 2019-2022 was a period of upheaval for the brand, which benefited from excellent vintages that captured investors’ interest.
<img loading="lazy" decoding="async" class="alignnone wp-image-1795" src="https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-375x269.png" width="800" height="573" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-375x269.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-768x550.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-1536x1100.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-2048x1467.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-1200x860.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Sassicaia-price-performance-1980x1418.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Screaming Eagle vs Lafite Rothschild</h2>
The price ratio between <a href="https://winecap.com/wine-track/united-states/california/oakville/screaming-eagle/cabernet-sauvignon">Screaming Eagle</a> and Lafite Rothschild tells a story of increased volatility, which can largely be ascribed to the Californian cult wine. Screaming Eagle has seen bigger price rises, followed by sharper falls.
Today one can now get 4.8 bottles of Lafite for the price of Screaming Eagle, up from 2.7 a decade ago. The ratio peaked in February 2022, when it stood at 5:1.
<img loading="lazy" decoding="async" class="alignnone wp-image-1796" src="https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-ratio-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
California has enjoyed serious investment interest which has been reflected in its market share. Today the region holds around 7% of the fine wine trade by value and is the most important New World player.
<img loading="lazy" decoding="async" class="alignnone wp-image-1797" src="https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-375x260.png" width="800" height="556" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-375x260.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-768x533.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-1536x1067.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-2048x1422.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-1200x833.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/11/Screaming-Eagle-price-performance-1980x1375.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
While Lafite has come to represent better value when compared to other top wines, this is largely due to shifting regional market dynamics. The First Growth continues to entice buyers with brand strength, high-quality releases and returns on investment.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Price ratio: comparing regional First Growths

<ul>
<li>Argiano Brunello di Montalcino 2018 ranked at Wine Spectator’s Wine of the Year. </li>
<li>Laurent-Perrier Champagne Grand Siècle Iteration N.26 took the first spot in James Suckling’s annual rankings. </li>
<li>Poggio di Sotto Brunello di Montalcino 2018 was Wine Enthusiast’s top cellar recommendation. </li>
</ul>
On Friday, <a href="https://top100.winespectator.com/2023/wine/wine-no-1-argiano/">Wine Spectator</a> announced its ‘Wine of the Year’ – Argiano Brunello di Montalcino 2018.
The publication wrote: ‘In the world of wine, a change of ownership or a stylistic paradigm shift can reap huge benefits, but there are always risks. In the case of Argiano, change has paid off in spades, as new owners arrived with a commitment to a return to a more traditional expression of Brunello. Reflecting more than $10 million in investment in the estate over a decade, the stellar quality of Argiano Brunello di Montalcino 2018 earns it Wine of the Year honors from Wine Spectator in 2023.’
The wine has enjoyed increased demand after the announcement and has traded at a 45% premium on its Market Price. This is not a new phenomenon. According to <a href="https://www.liv-ex.com/">Liv-ex</a>, ‘over the last few years, most of the Wine Spectator’s top wines have enjoyed significant trading activity and an uptick in price’.
For instance, the 2018 Wine Spectator’s wine of the year, Sassicaia 2015, has seen its Market Price double from £1,350 per 12&#215;75 to £2,700 after the announcement. Similarly, the 2019 wine of the year – Château Léoville Barton 2016 – enjoyed an immediate price surge.
This year, other investment-grade wines that ranked in the publication’s top ten list include <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lynch-bages/lynch-bages">Château Lynch Bages 2020</a> (3) and <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-pichon-baron/pichon-baron">Château Pichon Baron 2020</a> (8).
<h2>James Suckling’s top picks for 2023</h2>
James Suckling also released his <a href="https://www.jamessuckling.com/wine-tasting-reports/top-100-world-wines-2023-and-our-wine-of-the-year/">Top 100 World Wines 2023 and Wine of the Year</a> report, giving Laurent-Perrier Champagne Grand Siècle Iteration N.26 the first spot.
The critic said that ‘it’s not just an incredible bottle of Champagne, it’s the best wine we rated this year out of the almost 39,000 reviewed by myself and my team of seven tasters/editors’. This is the ‘the largest number of wines [they] have ever reviewed in a year, beating last year’s record of about 32,000’.
Suckling’s top ten also included the 100-point <a href="https://winecap.com/wine-track/chile/aconcagua/na/mondavi-&amp;-chadwick/sena">Seña 2021</a> (3) and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-figeac/figeac">Château Figeac 2020</a> (4).
<h2>Wine Enthusiast’s top cellar selections</h2>
Another Brunello di Montalcino stole the spotlight in <a href="https://www.wineenthusiast.com/toplists/cellar-selections-2023/">Wine Enthusiast</a>’s annual rankings. Poggio di Sotto Brunello di Montalcino 2018 was their top cellar recommendation for 2023.
Their report stated: ‘This list represents what’s next in Wine Enthusiast’s Cellar Selections—wines with consistency and structure that aren’t necessarily the biggest and boldest. The number one wine, for example, is Poggio di Sotto’s 2018 Brunello di Montalcino, not the most legendary in its region of Italy but what a wine!’
Their number two wine was Ribera del Duero Vega Sicilia Unico 2012, which they described as ‘a proven collectible’ and a ‘gem’ which ‘represents Spain as an underappreciated wine country full of discoveries’.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Wine Spectator ‘Wine of the Year’ and critics’ top picks

A version of this article written by WineCap’s CEO Alexander Westgarth was first published by <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/11/07/investing-in-fine-wine-stability-sustainability-and-profitability/?sh=2a7371e72b12">Forbes</a>.
<ul>
<li>A popular alternative investment, fine wine can plug the gaps left by struggling assets, helping to steady and raise performance across a whole portfolio.</li>
<li>As a tangible asset, fine wine delivers stability in uncertain times. </li>
<li>Part of the rising demand for fine wine can be attributed to environmental factors. </li>
</ul>
Between April 2020 and September 2022, the average bottle of fine wine rose <a href="https://winecap.com/learn/how-fine-wine-hedges-against-economic-shocks-in-four-graphs">43.5% in value</a>. While the fine wine market has dipped and corrected since, the general trajectory has historically pointed upwards.
Since 2004, Liv-ex data shows that the average bottle price tag <a href="https://www.liv-ex.com/news-insights/indices/">has risen by 329.9%</a>. While it can be a good investment, better still, fine wine is a great means to plug the gaps left by struggling assets, helping to steady and raise performance <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/08/30/how-to-include-fine-wine-in-your-investment-portfolio/?sh=6976d2501789">across a whole investment portfolio</a>. Earlier this year, WineCap conducted a survey where we found that <a href="https://winecap.com/learn/us-wine-investment-report">92% of U.S. wealth managers</a> believe demand for fine wine will increase over the next year. This is for three main reasons, and below we outline how to best take advantage of this asset&#8217;s potential for stability, sustainability and profitability.
<h2>Stability in uncertain times </h2>
We live in uncertain times. In the last year, businesses have had to cope with rocketing energy bills, inflation and interest rates. In times of hardship, people want something solid. This is why tangible assets like property, gold or fine wine tend to feel more precious during market downfalls. WineCap found that 56% of wealth managers invest in wine to add stability to portfolios across different market conditions.
It is not only wine. Across the entire investment landscape, there is an increased demand for reliability. In the past few months, <a href="https://www.gold.co.uk/gold-price/">gold prices have been rallying too.</a> When the gold prices go up, this often indicates that investors are looking to preserve their wealth and shield it from market shocks.
At the same time, investors have been shying away from bullish investments like technology stocks. Apple, for example, has <a href="https://www.investopedia.com/apple-and-samsung-lost-market-share-as-global-smartphone-sales-fell-in-q3-8362147">suffered significant dips</a>. Microsoft shareholders have endured <a href="https://www.wsj.com/articles/microsoft-cant-afford-turbulence-from-new-copilot-54a81149">wobbly turbulence</a> (though, at the time of this writing, the company is <a href="https://www.nytimes.com/2023/04/25/business/microsoft-quarterly-earnings.html">beating financial expectations</a>). Likewise, the tech-heavy Nasdaq Composite has been <a href="https://www.investing.com/analysis/4-factors-to-watch-out-for-in-october-as-wall-st-wraps-up-rocky-september-200642260">on a rocky ride</a> over the past months.
As the choppy waters continue, many investors want steady ships to ride out the storm – not fancy speedboats. With its historically low volatility, fine wine delivers just that. Unlike stocks or bonds, fine wine prices do not tend to fluctuate massively as the market operates with its own dynamics. Regions like <a href="https://winecap.com/news/investment-opportunities-in-lvmh-champagnes">Champagne</a> are currently seeing high levels of demand, not only because of the quality of the wines but the stability the region has historically offered.
Similarly, wines from Bordeaux, Tuscany and the Rhône may be more solid. However, not all fine wines are made the same. Extremely rare and highly coveted wines from Burgundy, for instance, can make a great investment but remain a riskier asset if stability is what you are after.
<h2>Demand for environmentally friendly assets</h2>
Our survey also found that investors are prioritising environmentally friendly assets, and 56% say they invest in fine wine because it is a sustainable asset class with a low carbon footprint. This trend is hardly surprising; 2023 has been the hottest summer on record.
Dozens of <a href="https://www.nifc.gov/fire-information/nfn">wildfires are actively blazing through the USA</a>. Meanwhile, elsewhere, the excess water caused by melted ice caps means that flooding and torrential rains are washing away entire communities. In August, flash floods tore through Pennsylvania, <a href="https://edition.cnn.com/2023/07/16/weather/northeast-storms-sunday/index.html">killing five people</a>. Naturally, investors are keen to put their money into assets that will mitigate some of the climate risks.
Part of the interest in fine wine can be attributed to environmental factors. Vines promote healthy soil quality and nourish pollinators, which are essential for biodiversity. A hector of vineyard soaks up a respectable <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">2.84 tonnes of carbon</a> every year. The best winemakers use age-old sustainable practices. Many will even opt for a pony and cart rather than disturb the terrain with a tractor.
Some well-known organic producers include Burgundy’s Domaine Leflaive and the Bordeaux Fifth Growth, Château Pontet-Canet. While not officially certified, Burgundy’s Domaine de la Romanée-Conti also follows organic and biodynamic guidelines. Meanwhile, some producers are reducing bottle weight in pursuit of sustainability such as Burgundy négociant Albert Bichot, which has reduced the weight of their bottles from around 700 grams to 450 grams.
Climate-conscious investors can keep an eye out for wineries investing in a greener future.
<h2>Strong returns</h2>
According to our survey, almost half of the investors choose fine wine because they want strong returns. Historically, fine wine has offered generous returns over long periods without sacrificing quality or environmental qualities. Access to historical data, critic scores and current prices can help an investor identify whether a wine represents a good opportunity. Things to look out for include brand prestige, price per point, investment appreciation over different time frames and drinking windows. One can also get help from experts who understand the intricacies of the market, utilize the latest technology and closely follow the trends.
<h2>Stability, sustainability and profitability </h2>
Today’s investors are looking for stability, sustainability and profitability. Different from last year, they are often less prepared to invest in edgy technologies for the future. Instead, many are looking for solid investment results – ideally, ones they can hold. Fine wines fit this demand well. Although it already features in <a href="https://winecap.com/learn/us-wine-investment-report">45% of HNW portfolios</a>, with average allocations of 13%, fine wine looks set to become even more popular. Like a classic vintage Champagne, the market is ready to pop.
Thanks to its diversity and growing attention from experts, producers and enthusiasts, fine wine could be well-placed to meet investors&#8217; changing priorities in the years to come.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The rise of fine wine as a stable and sustainable investment

<ul>
<li>Jeb Dunnuck recently reviewed two vintages from Southern Rhône – the 2021 in bottle and 2022 in barrel. </li>
<li>He described 2022 as a ‘clear step up over 2021’.</li>
<li>Château de Beaucastel’s Châteauneuf-du-Pape Roussanne Vieilles Vignes 2022 received 100 points from the critic, and prices for the label have risen 60% in the last five years.</li>
</ul>
Last week, <a href="https://jebdunnuck.com/2023/11/southern-rhone-the-2021s-from-bottle-and-the-2022s-from-barrel/">Jeb Dunnuck</a> released his latest Southern Rhône report, reviewing the 2021 vintage from bottle and the 2022 mostly from barrel.
The critic observed that ‘the time of truly bad vintages is mostly over’ given ‘the advances in viticulture and winemaking’. This is especially true for ‘a region like the southern Rhône, which has so much flexibility with grape varieties and different terroirs’.
<h2>2021 – drinking rather than collecting</h2>
The 2021 Southern Rhône vintage was marked by devastating springtime frosts, which dramatically reduced yields. A cool, rainy year led to ‘forward and charming [wines], with mid-weight, linear, fresher profiles,’ according to Dunnuck.
Dunnuck said that ‘2021 is not a great vintage’ when tasted next to a top 2019, 2016 or 2010. While he commended the accessibility and finesse of the wines, which would be ‘loved by sommeliers’, the critic noted that ‘it’s not a vintage to seek out or buy in massive quantities for the cellar’.
<h2>2022 – checks in ‘behind the greats’</h2>
Dunnuck described the 2022s as ‘a clear step up over 2021s’. He noted that the vintage bears some similarities ‘to 2020 and 2011, if not a more linear, mid-weight version of 2009’. For him, ‘2022 looks to check in behind the greats of 2019, 2016, 2010, and 2007’.
However, the critic concluded that ‘the divergent styles throughout the region make 2022 a difficult vintage to describe in broad statements, so it’s a vintage that readers will need to approach on an estate-by-estate basis’.
Dunnuck’s top-scoring wines across both years can be seen in the table below.
<img loading="lazy" decoding="async" class="alignnone wp-image-1742" src="https://wp.winecap.com/wp-content/uploads/2023/11/JD-SR-1-375x145.png" width="800" height="310" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/JD-SR-1-375x145.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/JD-SR-1-768x297.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/JD-SR-1.png 982w" sizes="(max-width: 800px) 100vw, 800px" />
Across both years, Jeb Dunnuck found perfection in one wine – Château de Beaucastel’s Châteauneuf-du-Pape Roussanne Vieilles Vignes 2022. Awarding it 100 points, he called it ‘pure Beaucastel magic’. Average prices for the label have risen <a href="https://winecap.com/wine-track/france/rhone/chateauneuf-du-pape/famille-perrin/chateauneuf-du-pape-roussanne-vv">101% over the last decade</a>, and 60% in the last five years.
<img loading="lazy" decoding="async" class="alignnone wp-image-1741" src="https://wp.winecap.com/wp-content/uploads/2023/11/Roussane-edited-375x238.png" width="800" height="507" srcset="https://wp.winecap.com/wp-content/uploads/2023/11/Roussane-edited-375x238.png 375w, https://wp.winecap.com/wp-content/uploads/2023/11/Roussane-edited-768x487.png 768w, https://wp.winecap.com/wp-content/uploads/2023/11/Roussane-edited.png 1114w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>The Rhône’s investment performance in 2023</h2>
Prices for the top Rhône labels have been falling this year. Across the Liv-ex 1000 regional sub-indices, the Rhône 100 has experienced the biggest decline, down 18.1%.
However, young vintages like 2019 and 2020 have been in demand. Moreover, some wines from Southern Rhône such as <a href="https://winecap.com/wine-track/france/rhone/chateauneuf-du-pape/famille-perrin/chateauneuf-du-pape-blanc">Château de Beaucastel Châteauneuf-du-Pape Blanc</a> have been on an upward trend, rising 32.8% on average.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

Jeb Dunnuck’s top-scoring Southern Rhône releases

<ul>
<li>Once the dominant force in the fine wine market, the Bordeaux First Growths have lost market share due to its broadening. </li>
<li>In the last decade, Château Mouton Rothschild has been the best price performer, up 43.2%.</li>
<li>Château Haut-Brion offers the best value, with the highest average critic score and the lowest average price per case. </li>
</ul>
<h2>The Bordeaux First Growths in a broadening market</h2>
The Bordeaux First Growths have long been the cornerstone of the fine wine investment market. Back in 2010, they made up close to 90% of all Bordeaux trade by value – at a time, when Bordeaux’s share of the total market stood at 96%.
With the broadening of the market, their share has decreased and they now regularly account for around 30% of all Bordeaux secondary market trade (which itself has fallen below 35% annual average).
This trend was also reflected in the <a href="https://www.liv-ex.com/2022/11/liv-ex-power-100-2022-burgundy/">2022 Power 100 list</a>, which offered a snapshot of the ever-changing landscape of the secondary market. For the first time ever, no Bordeaux wines featured among the top ten most powerful fine wine labels.
Even if trade for these brands remains consistent or increases, the First Growths are facing greater competition. Still, they are among the wines with the greatest liquidity, attracting regular demand and high praise from critics year after year.
<h2>First Growths’ price performance</h2>
In terms of price performance, the five First Growths have followed a similar trajectory (i.e. rising post-Covid and dipping in the last year in line with the <a href="https://winecap.com/learn/q3-2023-fine-wine-report">current market reality</a>). The relative outcast has been <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-latour/latour">Château Latour</a>, whose performance was impacted by the decision to <a href="https://www.decanter.com/wine-news/chateau-latour-leaves-en-primeur-31707/">leave the En Primeur system</a> in 2012. The wine has been the worst-performing First Growth, up just 17.9% in the last decade.
The best performer has been <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/mouton-rothschild">Château Mouton Rothschild</a>, with an increase of 43.2%. Recent releases have elevated the performance of the brand, like the 2020 vintage, which boasts 100-points from The Wine Advocate’s William Kelley, 99-100 from James Suckling, 98-100 from Jeff Leve and 99 from Antonio Galloni (Vinous). ‘Off’ vintages like 2011, 2013 and 2014, which have greater room to rise, have also fared well over the last five years.
The second-best performer has been <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-margaux/margaux">Château Margaux</a>, which is also the second most affordable First Growth. Similarly, its biggest price risers have been 2014, 2011 and 2013. Less classical years reveal the strength of these brands, as demand for the First Growths remains consistently high regardless of the vintage.
<img loading="lazy" decoding="async" class="alignnone wp-image-1733" src="https://wp.winecap.com/wp-content/uploads/2023/10/FG-375x237.png" width="800" height="505" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/FG-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-2048x1294.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-1980x1251.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>First Growths’ price and score comparison</h2>
The table below shows the average price per case and critic score of the First Growths for vintages since 2000.
<a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-haut-brion/haut-brion">Château Haut-Brion</a> tops the list with the highest average score (95.9) and the lowest average price per case (£4,595). With a price per point of £48, the wine seems to offer the best value among the First Growths. Vintages that have received 100-points from <a href="https://www.robertparker.com/">The Wine Advocate</a> include 2018 (LPB), 2016 (LPB), 2015 (LPB), 2009 (LPB) and 2005 (RP).
Looking at the average prices, <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-haut-brion/haut-brion">Château Lafite Rothschild</a> stands out as the most expensive of the First Growths. The wine has achieved 100-points from The Wine Advocate for its 2019 (WK), 2018 (LPB), 2010 (LPB) and 2003 (RP) vintages.
<img loading="lazy" decoding="async" class="alignnone wp-image-1734" src="https://wp.winecap.com/wp-content/uploads/2023/10/FG-comparison-375x182.png" width="800" height="388" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/FG-comparison-375x182.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-comparison-768x372.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/FG-comparison.png 998w" sizes="(max-width: 800px) 100vw, 800px" />
In conclusion, the First Growths remain an important part of the changing secondary market, offering brand strength, consistently high quality and stable growth.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The place of the Bordeaux First Growths in a changing fine wine market

<ul>
<li>Australia and China have agreed to a suspension of their ongoing dispute over the steep tariffs imposed on Australian wine since November 2020.</li>
<li>The tariffs had a profound impact on demand and price performance of Australian wine. </li>
<li>Australia’s best price performers have risen over 40% in value in the last year.</li>
</ul>
<h2>Australian wine tariffs under review</h2>
In a significant shift that could redefine trade relations between Australia and China, the two nations have agreed to a <a href="https://amp.theguardian.com/australia-news/2023/oct/22/australia-and-china-suspend-wto-wine-tariff-dispute-ahead-of-albanese-trip-to-beijing">suspension</a> of their ongoing dispute over the steep tariffs imposed on Australian wine since November 2020. This development comes ahead of Australian Prime Minister Anthony Albanese&#8217;s forthcoming trip to Beijing, marking a potential thaw in the trade tensions that have severely impacted Australia&#8217;s wine industry.
While the Chinese government has consented to an expedited five-month review of the punitive duties, which have plummeted Australia&#8217;s wine exports from over $1 billion to a mere $12 million, there remains a cautious optimism. Despite this progress, <a href="https://www.thedrinksbusiness.com/2023/10/australian-wine-tariffs-on-hold-but-dont-jump-for-joy-just-yet/">industry experts</a> predict that even if the tariffs are promptly revoked, the Australian wine sector, which has undergone substantial restructuring in response to the lost Chinese market, would still require approximately two years to recuperate and effectively redistribute its current surplus.
<h2>Impact on Australia’s wine investment market</h2>
The Chinese tariffs, ranging from 180% to 200% on Australian wine imports, had a profound impact on Australia’s budding secondary market. The country has historically been the second most important fine wine player from the New World after the U.S., enjoying greater demand than South Africa, Chile or Argentina.
After a record-breaking year of trade in 2020, Australia’s investment market shrank in 2021. The number of different Australian wines traded on Liv-ex declined 32.2% year-on-year, as demand decreased.
Fewer wines from Australia made it into the rankings of the most powerful brands in the world. Australia’s leading label, Penfolds Grange, dropped in the 2021 <a href="https://www.liv-ex.com/2021/11/2021-liv-ex-power-100-rebalancing-act/">Power 100 rankings</a>, from fifth in 2020 to 45th place in 2021. In last year’s edition of the rankings, the wine fell further – from 45th to 55th place, while Henschke exited altogether. Part of the reason is that Penfolds has historically been heavily reliant on the Chinese market. In an attempt to rebuilt tariff-hit business, earlier this year Treasury Wine Estates, owner of Penfolds, announced the introduction of its first <a href="https://www.reuters.com/article/china-penfolds-idUSL8N325155">China-sourced</a> premium wine.
<h2>Australian wine price performance</h2>
Since the tariff introduction, prices for some of the top wines have dipped, creating pockets of opportunity. For instance, the average price of <a href="https://winecap.com/wine-track/australia/south-australia/eden-valley/henschke/hill-of-grace-shiraz">Henschke Hill of Grace</a> is down 4% in the last year; similarly, <a href="https://winecap.com/wine-track/australia/south-australia/na/penfolds/bin-707-cabernet-sauvignon">Penfolds Bin 707</a> is down 9%. While their trajectories are different, the long-term growth trend remains, with over 90% rise in the last decade.
<img loading="lazy" decoding="async" class="alignnone wp-image-1730" src="https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-375x248.png" width="800" height="529" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-375x248.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-768x508.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-1536x1017.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-2048x1355.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-1200x794.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/10/HoG-707-FINAL-1980x1310.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
Some Australian brands have seen impressive price performance despite the ongoing trade tension. The table below shows the five best performers on <a href="https://winecap.com/wine-track">Wine Track</a> in the last year, which have risen between 31% and 41% on average. Clarendon Hills Brookman Syrah leads the rankings, with an average price per case of £1,042. Two Hands Aphrodite has been the second-best performer, up 39%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1729" src="https://wp.winecap.com/wp-content/uploads/2023/10/best-performing-aus-wines-375x172.png" width="800" height="367" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/best-performing-aus-wines-375x172.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/best-performing-aus-wines-768x352.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/best-performing-aus-wines.png 1109w" sizes="(max-width: 800px) 100vw, 800px" />
The cautious optimism for Australian wine will likely affect its secondary market performance. As demand rises, so will prices. It remains to be seen if a potential tariff suspension will bring back the momentum to a region that has quietened down in the last three years but nonetheless remains an important New World representative.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Cautious optimism for Australian wine amid tariff review

Our Q3 2023 report has now been released. The report examines mainstream market performance, the best buying opportunities in fine wine, releases from La Place de Bordeaux and the latest industry news.
Report highlights:
<ul>
<li>Investors leaned towards liquid assets like cash amidst the struggle between the Federal Reserve and inflation, contributing to an environment steeped in risk and uncertainty.</li>
<li>Q3 witnessed a marked slowdown and potential bottoming out of fine wine prices, with the Liv-ex 100 index showing modest signs of recovery.</li>
<li>The fine wine market morphed into a buyer’s market due to stock availability and dipping prices, especially visible in regions like Champagne.</li>
<li>The La Place de Bordeaux campaign, amidst an eleven-month market decline and global economic uncertainties, mirrored the earlier En Primeur campaign in its inability to energise the market, with offerings often misaligned with trade expectations.</li>
<li>Wines like Almaviva 2021 and Masseto 2020 stood out, providing relative value for money and showcasing a strong price performance history.</li>
<li>Investors should be looking at ‘pockets of opportunity’ where there is brand strength, value and liquidity.</li>
<li>Demand is likely to pick up in Q4 with Christmas around the corner and exciting vintage releases on the horizon.</li>
</ul>
Click below to download your free copy of our quarterly investment report.

Q3 2023 Fine Wine Report

The following article is an extract from our Q3 Fine Wine Investment report, which will be published next week. 
<ul>
<li>Ongoing inflation and interest rate hikes led to increased volatility in mainstream markets.</li>
<li>The fine wine market in Q3 was a buyer’s market for two main reasons: availability of stock and falling prices creating value.</li>
<li>Two of the best value La Place releases were Almaviva 2021 and Masseto 2020. </li>
</ul>
<h2>High interest rates rattle global markets</h2>
Mainstream markets experienced a turbulent third quarter, mainly due to a marked rise in borrowing costs coupled with a <a href="https://www.reuters.com/markets/global-markets-q3-graphic-2023-09-29/">substantial increase</a> of nearly 30% in oil prices. As a major <a href="https://groww.in/blog/how-oil-prices-affect-your-portfolio">input in several industries</a>, rising prices for crude oil led to overall increase in production costs, impacting profit margins and, ultimately, reducing stock prices. These developments created a challenging landscape for stocks and bonds, with investors opting for more liquid assets like cash that tends to be a safer short-term bet. This inclination towards liquid assets illustrated the <a href="https://www.axios.com/2023/09/29/crude-oil-price-investments-q3-2023">unresolved struggle</a> between the Federal Reserve and inflation, leaving investors navigating a path marked by heightened risk and uncertainty.
<h2>Fine wine’s downturn slows</h2>
Fine wine prices fell in Q3, but their declines gradually became smaller. For instance, the Liv-ex 100 index recorded dips of 3.1% in July, 1.3% in August and 0.1% in September, showing humble signs of recovery. The broader Liv-ex 1000 index dipped 3.9% in Q3. Italian wine fared well, thanks to strong performance from Tuscany and Piedmont, as well as older Bordeaux vintages which experienced slight rebounds. Global trading activity increased suggesting that interest is there for well-priced stock.
<h2>A buyer’s market</h2>
The fine wine market in Q3 was a buyer’s market for two main reasons: availability of stock and falling prices creating value. This was particularly noticeable in regions like <a href="https://winecap.com/news/investment-opportunities-in-lvmh-champagnes">Champagne</a>. Some of the top and most desirable brands, which have an impressive mid- to long-term performance saw small declines in Q3. Buyers took advantage of this opportunity and demand increased. Such is the case with Dom Pérignon 2013, which has fallen 7.1% in value since its release in January but has been the most traded wine this year. The brand’s overall trajectory is upwards, with <a href="https://winecap.com/wine-track/france/champagne/na/dom-perignon/dom-perignon">Dom Pérignon prices</a> rising 64% on average in the last five years, and 133% over the last decade.
<h2>Assessing the La Place de Bordeaux campaign</h2>
Over 110 fine wines were released through La Place de Bordeaux this September. The overall pricing strategy bore similarities to Bordeaux En Primeur earlier this year: price increases that failed to take the current market environment into account. <a href="https://winecap.com/news/la-place-2023-critics-verdict-and-top-scoring-wines">Some critics</a> expressed the opinion that there weren’t ‘as many hits as usual’. Two wines that stood out as good value were Almaviva 2021 and Masseto 2020; the latter immediately generated trading activity above its release price.
Over the last decade, Almaviva prices have risen on average 167%, while Masseto is up 107%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1717" src="https://wp.winecap.com/wp-content/uploads/2023/10/Almaviva-Masseto-375x257.png" width="800" height="549" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/Almaviva-Masseto-375x257.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/Almaviva-Masseto-768x527.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/Almaviva-Masseto.png 1200w" sizes="(max-width: 800px) 100vw, 800px" />
Stay tuned &#8211; our Q3 Fine Wine Investment report will be published next week. The report contains further analysis on the best-performing and most in-demand wines, and Q4 investment outlook.

Key trends that shaped the fine wine market in Q3

<ul>
<li>Salon Le Mesnil Blanc de Blancs 2013 has enjoyed heightened demand shortly after release.</li>
<li>The 2013 offers good value compared to similarly scored back vintages, which come at a significant price premium.</li>
<li>Salon has delivered higher returns (71%) than the Champagne 50 index (62.8%) over the last five years. </li>
</ul>
The latest release from Champagne house Salon has already been met with heightened demand. Salon Le Mesnil Blanc de Blancs 2013 came to the market at the end of September, and featured among the <a href="https://www.liv-ex.com/2023/09/newly-released-salon-2013-among-traded-wines-value/">most traded wines on Liv-ex</a> shortly after. Below we examine the reasons behind this increased interest and the wine’s investment potential.
<h2>The ‘magnificent’ 2013 Salon release </h2>
The 2013 was the first vintage release following <a href="https://www.decanter.com/premium/first-taste-champagne-salon-2013-511332/">two unusual releases</a>: the 2012 which the Champagne house initially said they would not offer, and the 2008 of which only 8,000 magnum bottles were released (about 1/3 of their normal production).
The wine received 99-points from Antonio Galloni (<a href="https://vinous.com/wines/salon-salon/2013">Vinous</a>), who declared it ‘the most powerful, dense young Salon I have ever tasted’. The critic further noted: ‘Champagne of mind-bending complexity, the 2013 possesses tremendous mid-palate intensity and power from the very first taste’.
Meanwhile, the <a href="https://www.robertparker.com/wines/9ZcqMWh446RyAWWTE/brut-blanc-de-blancs-le-mesnil-2013">Wine Advocate</a>’s Yohan Castaing awarded the wine 97-points, saying that 2013 is ‘more complex and incisive than the 2002 and exhibits similar power to the 2012 at this early stage’.
In terms of value, the 2013 stands out among other Salon vintages available in the market today. The only higher-scoring scoring wine is the 2008 at nearly twice the price. Other similarly scored back vintages such as the 1996, 1995, and 1990 also come at a significant premium to the 2013.
<img loading="lazy" decoding="async" class="alignnone wp-image-1712" src="https://wp.winecap.com/wp-content/uploads/2023/10/EP-Socials-LinkedInAll-1-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/EP-Socials-LinkedInAll-1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/10/EP-Socials-LinkedInAll-1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/10/EP-Socials-LinkedInAll-1.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Salon brand performance</h2>
Perhaps the most coveted of all Champagne brands, Salon is certainly one of the rarest. Only around 50,000-60,000 bottles are made in most years, and fewer than 50 vintages in the last 100 years.
Salon is a wine defined by its singularity, representing a single vintage expression from one grape and one village. The wine was originally conceived as a private label for the consumption of its founder Eugène-Aimé Salon at a time when the making of Champagne was characterised by blending.
Salon’s exclusivity has been reflected in its investment performance. The wine has delivered higher returns (71%) than the Champagne 50 index (62.8%) over the last five years.
Even in the current climate that has seen prices fall across the board, Salon has fared better than average, down 7% compared to a 12.9% decrease for the broader index, which includes the likes of Krug and Cristal.
The long-term prospects for a wine as rare and highly regarded as Salon are more than promising. There is significant space for Champagne prices to rise in the medium term, and a wine like Salon is especially well placed to benefit.
<img loading="lazy" decoding="async" class="alignnone wp-image-1713" src="https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-375x248.png" width="800" height="529" srcset="https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-375x248.png 375w, https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-768x508.png 768w, https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-1536x1017.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-2048x1355.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-1200x794.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/10/USE-THIS-Salon-inc-2008-10yrs-1980x1310.png 1980w" sizes="(max-width: 800px) 100vw, 800px" />
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Examining the investment potential of Salon 2013 amid heightened demand

<ul>
<li>The fine wine market is not correlated with mainstream markets yet there are some notable similarities and differences between them.</li>
<li>Global events and the law of supply and demand affect both the fine wine and financial markets.</li>
<li>Some of the main differences are tangibility, liquidity, the impact of time and factors influencing their performance.</li>
</ul>
The world of fine wine and the broader financial market might seem like distinct universes at first glance. However, there are intriguing similarities and differences between the two, which we examine below. 
<h2>Similarities between fine wine and financial markets</h2>
Both fine wine and financial markets provide lucrative opportunities for investors. While the latter showcases a plethora of options like stocks, commodities, and currencies, the former provides an alternative avenue for diversification, offering tangible assets, valued not just for their financial potential but also their historical and cultural significance. In stark contrast to the complexity and varied strategic approaches inherent in the financial markets, the wine market is more straightforward, predominantly guided by a &#8216;buy and hold&#8217; strategy. Moreover, the universe of investable wines is notably narrower, typically centering around a select group of regions and producers.
Driven by demand
The laws of supply and demand are central to price determination in both markets. A rare vintage from a renowned vineyard or a wine produced in small quantities can fetch astronomical prices due to limited supply, mirroring the price surge of a high-demand stock or asset. For instance, <a href="https://winecap.com/wine-track/france/burgundy/saint-aubin/hubert-lamy/saint-aubin-derriere-chez-edouard">Hubert Lamy Saint-Aubin Premier Cru Derriere Chez Edouard Saint Aubin</a> has risen 189% in value over the last year due to low supply. The singular wine comes from a tiny plot of 0.7 hectares in Derrière chez Edouard, which was planted 20 years ago at 30,000 vines per hectare. At such a density, the entire plot only yields enough juice to fill the contents of a single barrel. In the world of stocks, demand has played a key role too. Nvidia – the company of the AI-fueled market rally – has been the best-performer in 2023, up 198%.
Impact of global events
Economic downturns, political events, and global crises can influence both the fine wine and financial markets. However, fine wine is less susceptible to global crisis. In fact, events <a href="https://winecap.com/learn/how-fine-wine-hedges-against-economic-shocks-in-four-graphs">that induce uncertainty</a> usually drive investors towards more stable, tangible assets, which can include fine wines.
For instance, the fine wine market hit new heights during the Covid-19 pandemic, which saw a shift away from risk assets. Prices rose due to heightened demand for fine wine, which demonstrated remarkable resilience during the pandemic.
Expert valuations
Just as financial analysts predict stock performances, wine experts gauge the potential value of wines, guiding investors&#8217; decisions. Investors can also follow the historical performance of their wines of interest with tools like <a href="https://winecap.com/wine-track/">Wine Track</a>, which shows the performance of different brands over various time periods, as well as average prices and scores.
<h2>Differences between the fine wine and financial markets </h2>
Tangibility
Investing in fine wine is an investment in tangible assets. The very bottle that appreciates in value over the years can be held, showcased, and ultimately consumed. Contrarily, financial investments, such as stocks or bonds, epitomise intangible assets, wherein the investment is in a concept or a digital representation.
Liquidity
The fine wine and financial markets have different levels of liquidity, which are rooted in their inherent trading characteristics. Fine wine tends to be less liquid, due to its tangibility, with transactions often slowed by factors such as the necessity for physical transport, authentication of products, and a comparatively limited buyer market. Additionally, investment-grade wines often necessitate longer holding periods to realise their gains, further reducing their liquidity. Meanwhile, the financial market is commonly cherished for its high liquidity, with assets like stocks and bonds that can be rapidly traded on large-scale platforms, accommodating a broad, active base of buyers and sellers.
The impact of time
The relationship between wine and time also sets these markets apart. While fine wine can age (which impacts its quality and value), financial assets do not inherently bear such physical transformations. However, their value may be just as susceptible to the passage of time and shifts in market dynamics.
Storage and maintenance
Fine wines require specific conditions for storage to retain or enhance their value, incurring additional costs. In contrast, stocks or digital assets don&#8217;t require such maintenance.
<h2>Factors influencing performance</h2>
In the wine investment landscape, several factors, including vintage quality, expert reviews, provenance, and global demand, play pivotal roles in determining a wine’s value and investment potential. Often burgeoning markets exert a profound influence, dynamically shaping global demand and investment flows, like <a href="https://www.thewinecellarinsider.com/wine-topics/china-bordeaux-wine-complete-story-current-situation-today/">China’s love affair with Bordeaux</a>.
On the other hand, the financial market is steered by economic indicators and central bank policies, technological advances and corporate actions, such as mergers and acquisitions. Each factor, be it micro or macro in scale, casts its influence over the market’s performance, underscoring the multifaceted nature of financial investments.
<h2>Investor profiles</h2>
Fine wine appeals to a myriad of audiences, including collectors, connoisseurs, and institutional investors seeking diversified, alternative investment portfolios. The allure of tangible, appreciative assets, coupled with a penchant for oenology, makes this market a vibrant tapestry of participants.
Conversely, the financial market is frequented by a diverse mix of retail and institutional investors, brokers, and analysts. The widespread availability of resources, platforms, and instruments in the financial domain makes it accessible to an extensive demographic.
While the fine wine market and the financial market operate in distinct realms, the parallels and contrasts between them offer valuable insights. As with any investment, potential investors in either market should conduct thorough research and seek expert advice. 
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Differences and similarities between the fine wine and financial markets

<ul>
<li>Recent LVMH Champagne releases offer a combination of high quality and relative value for money. </li>
<li>Dom Pérignon 2013 has been the most in-demand wine so far this year.</li>
<li>The current market environment has created plenty of Champagne buying opportunities, among which Krug 2006 stands out.</li>
</ul>
A name synonymous with luxury and quality, Louis Vuitton Moët Hennessy’s (LVMH) wines have become mainstays of any serious wine investment portfolio. Owners of iconic brands like Krug, Dom Pérignon, Ruinart, Veuve Clicquot and Ace of Spades, LVMH has set unparalleled standards in Champagne production.
Not only have their wines delivered quality, as affirmed by critic scores, but they have brought greater liquidity to the Champagne market. A common theme uniting some of their recent releases is the outstanding value they offer compared to back vintages.
<h2>Dom Pérignon 2013 – the most wanted wine this year</h2>
Dom Pérignon 2013 is the latest release from the most in-demand Champagne brand. The wine boasts 95+ points from the <a href="https://www.robertparker.com/">Wine Advocate</a>’s William Kelley, who called it ‘a lovely wine, defined by the long, cool growing season’.
The remarkable value it offers – as the most affordable Dom Pérignon vintage in the market today – has led it to become the most traded wine by both value and volume this year. The wine’s price has fallen slightly since release (-7.1%), in line with the recent reconciliation in Champagne prices. The Champagne 50 index has dipped 13.1% year-to-date.
However, the brand’s overall trajectory is upwards, with <a href="https://winecap.com/wine-track/france/champagne/na/dom-perignon/dom-perignon">Dom Pérignon prices</a> rising 64% on average in the last five years, and 133% over the last decade, making it an opportune time to buy.
<img loading="lazy" decoding="async" class="alignnone wp-image-1702" src="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-1-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-1.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Latest Krug Grande Cuvée editions </h2>
The crowning jewel of LVMH, Champagne house Krug, also introduced its latest Grande Cuvée earlier this year. The 171st edition, blended meticulously from 30 different vintages dating back to 2000, represents the lowest-priced Krug GC.
Magnums of the 168th edition are also new to the market, with the hallowed 2012 as the base vintage. Older releases of such magnums are hard to find and command a hefty premium, once again underlining the value to be had here.
<h2>Opportunities in Krug </h2>
The recent decline in Champagne prices has created buying opportunities for some of the top names. The latest Krug vintage, the 2008, has become more affordable after dipping 29.0% year-to-date. The wine received 97-points from Antonio Galloni (<a href="https://vinous.com/">Vinous</a>) who described it as a ‘nervy, electrifying Champagne, the likes of which has not emerged from Krug’s cellars since the magical 1996’.
However, the 2006 presents an even better investment opportunity. While it is the lowest-priced Krug vintage, its scores align with pricier alternatives such as 2002. The 2006 boasts 96-points from Neal Martin, 97-points from Galloni and 98-points from Kelley, making its value proposition even more evident.
Krug prices have risen 71% on average in the last five years (<a href="https://winecap.com/wine-track/france/champagne/na/krug/vintage-brut">see more on Wine Track</a>).
<img loading="lazy" decoding="async" class="alignnone wp-image-1703" src="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-2-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-2-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-2-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-2.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
Buyers can find plenty of opportunities in LVMH’s Champagnes. Despite the recent dip in the Champagne market, the long-term trajectory of these illustrious brands indicates a steady and impressive rise. The value on offer in some of the most recent offerings makes them an even more lucrative acquisition.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
 
&nbsp;

Investment opportunities in LVMH Champagnes

<ul>
<li>The market for alternative investments has seen robust growth owing to burgeoning demand for non-traditional assets.</li>
<li>Alternative assets offer a hedge against inflation, and often provide investors with higher returns.</li>
<li>Some of the main challenges when it comes to alternative investments are accurate valuations and liquidity.</li>
</ul>
Alternative investments, those that fall outside traditional financial assets like stocks, bonds, and cash, have garnered immense popularity among affluent investors. From classic cars and luxury handbags to fine art, these assets represent both a passion and a store of value. According to the results of our <a href="https://winecap.com/learn/uk-wine-investment-report">global wealth management survey</a>, fine wine emerged as the most in-demand passion asset. This article explores the burgeoning market for alternative investments, with a special emphasis on fine wine, contrasting and comparing their attributes, risks, and potential.
<h2>Alternative investment landscape</h2>
Alternative investments, often tangible assets, are known for their rarity, craftsmanship, and cultural relevance. Watches, luxury bags, art, whisky, and fine wine fall under this category, offering diversification for investment portfolios.
The market for alternative investments has witnessed robust growth owing to rising global wealth and a burgeoning demand for non-traditional assets. According to <a href="https://international-adviser.com/should-investors-be-moving-into-the-world-of-passion-assets/">Richard Bacon</a>, Head of Business Development at Shard Capital, ‘in the last two years there has been a tangible increase in how accessible and democratized these assets have become’.
<img loading="lazy" decoding="async" class="alignnone wp-image-1562" src="https://wp.winecap.com/wp-content/uploads/2023/06/UK-report--375x197.png" width="800" height="421" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/UK-report--375x197.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/UK-report--768x404.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/UK-report-.png 1085w" sizes="(max-width: 800px) 100vw, 800px" />
As traditional markets have faced increased volatility, clients have turned to passion assets to safeguard their wealth. Economic uncertainty and inflation have fuelled interest, as these assets tend to retain value over time and provide investors with higher returns outside of their traditional portfolios.
This can be noted in the performance of the luxury goods market, which posted a record year in 2022, reaching a market value of €345 billion, despite geopolitical tensions and macroeconomic uncertainty. This momentum persisted into the first quarter of 2023, achieving 10% growth over 2022, according to <a href="https://www.bain.com/about/media-center/press-releases/2023/global-luxury-goods-market-accelerated-after-record-2022-and-is-set-for-further-growth--despite-slowing-momentum-on-economic-warning-signs/">Bain &amp; Company</a>.
The luxury group Louis Vuitton Moët Hennessy (LVMH), which owns Champagne houses Moët &amp; Chandon, Dom Pérignon, Veuve Clicquot, Krug, Ruinart and Mercier, also had a record year in 2022, and <a href="https://www.lvmh.com/news-documents/press-releases/excellent-first-half-for-lvmh-july-2023/#:~:text=LVMH%20Mo%C3%ABt%20Hennessy%20Louis%20Vuitton,the%20same%20period%20in%202022.">reported a 15% growth</a> in the first half of 2023.
<h2>Alternative assets compared </h2>
While alternative investments have enjoyed growing popularity, each asset class operates by its own market dynamics. There are some notable differences and similarities, for instance, between fine wine, art and luxury goods. Below we outline some of the differences.
Investment nature:
<ul>
<li>Fine wine: A consumable and perishable asset produced in multiple quantities (vintage-dependent) with value appreciation due to age, supply-demand and quality.</li>
<li>Art: A unique, non-perishable asset, valuing subjectivity and aesthetic appeal.</li>
<li>Luxury goods: Tangible assets like watches and bags, offering functional utility and value based on brand prestige and condition.</li>
</ul>
Value determinants:
<ul>
<li>Fine wine: Producer reputation, age, rarity, condition, critic scores.</li>
<li>Art: Artist reputation, uniqueness, historical significance, and condition.</li>
<li>Luxury goods: Brand reputation, craftsmanship, condition, and rarity.</li>
</ul>
Risks:
<ul>
<li>Fine wine: Market fluctuations, storage conditions, and provenance verification.</li>
<li>Art: Market trends, authenticity, and condition degradation.</li>
<li>Luxury goods: Counterfeiting, fashion trends, and wear and tear.</li>
</ul>
However, all these assets share common grounds, including tangibility, scarcity and uniqueness driving value, a strong connection to culture and lifestyle, and being a hedge against inflation and economic uncertainty.
<h2>Market challenges and opportunities</h2>
Some of the main challenges when it comes to alternative investments are valuations and liquidity. Some assets may need longer time to trade compared to traditional investments. Values may fluctuate based on trends, and condition. It is often harder to value a single piece of art accurately, compared to fine wine, which is often made in significant quantities and cases regularly trade internationally.
The main opportunities in the alternative investment market are diversification, their potential for appreciation and pleasure and fulfilment beyond the monetary benefits. Alternative assets offer a balanced and diversified portfolio, mitigating risks from traditional markets. Meanwhile, rarity and cultural significance can result in substantial value appreciation. Beyond financial rewards, these investments offer emotional and aesthetic satisfaction. Navigating the market for alternative investments requires an understanding of the underlying dynamics, diligent verification, and a discerning eye for value.
To find out more about fine wine as an alternative investment, download our special report below.

The growing market for alternative investments

<ul>
<li>Major critics have released their ‘Beyond Bordeaux’ reports, accessing the quality and value of this year’s La Place releases. </li>
<li>Tom Parker MW stated that there were ‘not as many hits as usual’. </li>
<li>Jane Anson awarded three wines 100-points.</li>
</ul>
As the La Place de Bordeaux campaign takes centre stage in September, major critics have shared their views on this year’s releases, including Jane Anson (<a href="https://janeanson.com/">Inside Bordeaux</a>) and Tom Parker MW (<a href="https://www.jancisrobinson.com/articles/beyond-bordeaux-2023-releases">JancisRobinson.com</a>).
Both have commented on the quality of the wines but also on their pricing strategies and the value to be found. As <a href="https://winecap.com/news/new-world-releases-from-the-autumn-la-place-de-bordeaux-campaign">discussed last week</a>, a recurring theme in the campaign has been the price increases for the new releases, compared to previous vintages. This has done little to invigorate the market for buying at release for investment.
<h2>Tom Parker on the campaign’s ‘ambitious pricing’</h2>
In his ‘beyond Bordeaux’ assessment, Tom Parker MW expressed his wary view on the campaign’s strategy and pricing. He wrote that ‘the styles and regions are diverse, and the stories risk being lost in such a compressed release timetable’.
He added that ‘given the ambitious pricing for many of these wines, it is hard to see how they can all be sold through successfully’. Indeed, the campaign’s reception so far has been mediocre.
In terms of overall quality, Parker stated that ‘there were some excellent efforts though perhaps not as many hits as usual’.
<h2>Regional observations</h2>
Delving into individual regions, Parker noted the Californian producers’ split strategy, with ‘some releasing wines from the complicated 2020 vintage, with others choosing instead to offer museum releases and a few choosing to do both’. One such instance was <a href="https://winecap.com/wine-track/united-states/california/napa-valley/opus-one/opus-one">Opus One</a>, which opted for library release of its 2018 and 2019 vintages.
In terms of the Rhône releases, he observed that ‘Hommage à Jacques Perrin was good rather than great, and newly added and renamed Domaine de la Chapelle (formerly Jaboulet’s Hermitage La Chapelle) left a little to be desired in the tricky 2021 vintage’.
For him, ‘Argentina produced two of the most exciting wines’. He awared 18 out of 20 points to Zuccardi’s Finca Canal Uco and 17+/20 for <a href="https://winecap.com/wine-track/argentina/mendoza/na/catena-zapata/adrianna-vineyard-river-stones-malbec">Adrianna Vineyard</a> from Catena Zapata.
Parker also complimented Australian wines which were ‘technically immaculate’ and named Wynn’s John Riddoch ‘a personal favourite’.
His top Italian pick was <a href="https://winecap.com/wine-track/italy/tuscany/toscana/masseto/masseto">Masseto</a> (18/20), which he described as ‘almost a guilty pleasure in 2020’ though ‘only for those with the deepest pockets’. Although the wine was released at a 10% premium on last year, the new release still offered value in the context of back vintages.
<h2>Jane Anson awards three wines 100-points</h2>
Among the releases so far, Jane Anson awarded three wines 100 points – Bibi Graetz Colore 2021, Yjar 2019, and Giaconda Chardonnay 2021. The La Place newcomer Chappellet, Pritchard Hill Cabernet Sauvignon 2019 received a near-perfect score of 99-points from the critic.
Anson drew attention to Sicily as a region that offers both quality and value, saying that ‘Sicilian reds, as ever, offer some of the best value wines not just of the September Releases, but of the wine industry in general’.
She also acknowledged that ‘there’s no doubt that the wider economic stresses globally are both helping and hurting the September Releases’.
Once again, this highlights the importance of correct pricing in a broadening fine wine market.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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La Place 2023: Critics’ verdict and top-scoring wines

A version of this article by WineCap’s CEO Alexander Westgarth was first published by <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/08/30/how-to-include-fine-wine-in-your-investment-portfolio/?sh=384920bd1789">Forbes</a>.
<ul>
<li>Fine wine can serve as a stable, alternative asset in a diversified investment portfolio.</li>
<li>Investing in fine wine offers both economic resilience and long-term growth potential.</li>
<li>Proper storage and understanding of the asset are crucial for maximizing investment returns.</li>
</ul>
Fine wine, often associated with luxurious dining and celebratory events, has also gained recognition as a viable investment opportunity. This article explores how to strategically include fine wine in your investment portfolio, while highlighting its unique advantages and potential risks.
<h2>Positioning in the portfolio</h2>
In a well-diversified investment portfolio, asset allocation usually comprises a mix of stocks, bonds, and alternative investments. Stocks usually dominate, occupying roughly 50% of the total funds due to their potential for high returns. Bonds, typically accounting for 30% of allocations, offer a balance against the volatility of stocks. The remaining 20% is reserved for assets like real estate, hedge funds, cash, and alternatives. These offer a niche yet valuable opportunity for diversification. Industry experts typically recommend allocating a modest percentage of a portfolio to alternative investments, including fine wine. This provides enough room for additional returns without exposing the investor to excessive risk.
<h2>Fine wine as a recession buffer</h2>
One of the most striking attributes of fine wine as an investment is its resilience during economic downturns. Fine wine indices offer compelling evidence of how fine wine can act as a hedge during challenging economic times. For instance, in the first nine months of 2022, the stock market wobbled. The S&amp;P 500 dwindled downward, losing 23.7% in value by the end of September. However, in perfect contrast, the value of fine wine (according to Liv-ex 1000) rose 14.1% in the same time frame. While it might be tempting to sell off when the markets are doing well, fine wine can be extraordinarily helpful when downturns hit.
<h2>Long-term outlook</h2>
Investors should be aware that fine wine is an investment that rewards patience, and longer-term commitment. For instance, some fine wines, as shown on Wine Track, have seen <a href="https://winecap.com/wine-track">four-digit returns in the last decade</a>. On average, a bottle of Rene Engel Vosne-Romanee is up nearly 3,390% in value. The stellar growth can be attributed to the scarcity of the wine; the leading Burgundy winemaker Philippe Engel passed away in 2005 and the domaine was later sold to Francois Pinault and renamed to Domaine Eugenie. But this is not a single example. Leading fine wine indices show that the average value of a fine wine has <a href="https://www.liv-ex.com/news-insights/indices/">increased</a> by close to 70% in the last decade, and 340% in the last 20 years.
Patience is most definitely a virtue when it comes to investing in fine wine. The most long-term investors tend to get the highest returns. It is also crucial to note that fine wine is not as liquid an asset as stocks or bonds. Selling a wine may take weeks or even months, emphasising the need for a long-term investment strategy.
<h2>Proper storage</h2>
Preserving the quality of fine wine is crucial for realising its investment potential. Proper storage conditions, including a controlled environment with consistent temperature and humidity, are non-negotiable. The wine should ideally be stored horizontally to maintain cork moisture. Those unfamiliar with the intricacies of wine storage should consider hiring professional services. These specialised storage facilities not only offer optimal conditions but also provide insurance options to protect your valuable investment.
<h2>Understanding the asset</h2>
Fine wine is more than just a potential source of revenue; it is a tangible link to history and culture. Understanding the various factors contributing to a wine’s value, such as the region, vintage, and rarity, can offer more than just economic benefits. This multifaceted understanding can enrich an investor&#8217;s appreciation for the asset, making it a unique and satisfying component of a diverse investment portfolio.
In conclusion, incorporating fine wine into an investment portfolio requires careful planning, due diligence, and a long-term perspective to realise its full potential as a unique and rewarding asset.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

How to include fine wine in your investment portfolio

<ul>
<li>The La Place de Bordeaux campaign is in full swing, with releases from Chile, Italy, USA, France and more. </li>
<li>A recurring theme in the campaign has been the price increases for the new releases, compared to their previous vintages.</li>
<li>While La Place remains an exciting global marketplace for New and Old World wines, the ultimate value of the releases should be judged in a broader context.</li>
</ul>
The La Place de Bordeaux autumn campaign has gathered momentum over the past two weeks, with releases from Chile, Italy, USA, France and more.
The campaign kicked off with Paul Jaboulet Aîné’s Hermitage La Chapelle 2021, along with the re-release of some of its library vintages, namely 2013, 2011 and 2006. Napa Valley’s Opus One also re-released its 2018 and 2019 vintages, which led to heightened demand for the brand. Below we take a look at some of the recent New World releases from the campaign so far, examining their pricing and investment potential.
<h2>Seña 2021</h2>
The newly released 2021 vintage of Mondavi &amp; Chadwick’s Seña is the highest priced wine across recent vintages from the brand.
Seña 2021 was released at €90 per bottle ex-négociant, up 5.9% on the 2020. The wine came with a recommended retail price of £1,344 per 12&#215;75, representing a 30.6% increase on last year.
The 2021 Seña received 98+ points from <a href="https://www.robertparker.com/">The Wine Advocate</a>’s Luis Gutiérrez, who described it as ‘one of the finest vintages’. Meanwhile, Joaquín Hidalgo (<a href="https://vinous.com/wines/sena-sena/2021">Vinous</a>) gave it 96-points and said that ‘it will grow in the bottle’.
Other more attractively priced but similarly scored vintages include 2019 and 2018. Over the last ten years, Seña prices have <a href="https://winecap.com/wine-track/chile/aconcagua/na/mondavi-&amp;-chadwick/sena">increased 90%</a> on average.
<img loading="lazy" decoding="async" class="alignnone wp-image-1684" src="https://wp.winecap.com/wp-content/uploads/2023/09/Sena-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/09/Sena-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/09/Sena-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/09/Sena.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Almaviva 2021</h2>
Another release from Chile, Almaviva 2021, was offered via La Place at €122 per bottle ex-négociant, up 5.2% on the 2020. The wine was released internationally for £1,448 per 12&#215;75. It received 96+ points from Luis Gutiérrez, and another 96-points from Joaquín Hidalgo, who praised its ‘enticing nose’ and ‘velvet texture’.
However, some back vintages such as the 2020, 2019 and 2018 offer better value. Our <a href="https://winecap.com/wine-track/chile/central-valley/maipo-valley/rothschild-&amp;-concha-y-toro/almaviva">Almaviva index</a> has recorded positive performance both in the short and the long term. Over five years, prices have risen 41%, and over ten – 147%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1685" src="https://wp.winecap.com/wp-content/uploads/2023/09/Almaviva-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/09/Almaviva-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/09/Almaviva-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/09/Almaviva.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Nicolás Catena Zapata 2020</h2>
The Argentinian wine Nicolás Catena Zapata 2020 was released at €53.30 per bottle ex-négociant, up 1.5% on the 2019. It has been offered internationally at £720 per 12&#215;75, down 1.6% on the 2019’s opening price.
It received 95-points from Gutiérrez and 96-points from Hidalgo, who observed that this ‘meticulously crafted red achieves perfect balance in a warm vintage’. However, there are plenty of good value buying opportunities in back vintages, notably 2019, 2018 and 2016.
<a href="https://winecap.com/wine-track/argentina/mendoza/na/catena-zapata/nicolas-catena-zapata">Nicolás Catena Zapata</a> has enjoyed a positive performance over the last five (33%) and ten years (104%).
<img loading="lazy" decoding="async" class="alignnone wp-image-1686" src="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-375x196.jpg" width="800" height="418" srcset="https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/09/EP-Socials-LinkedInAll-1.jpg 1200w" sizes="(max-width: 800px) 100vw, 800px" />
A recurring theme in the campaign has been the price increases for the new releases, compared to their previous vintages. Similar to the spring <a href="https://winecap.com/learn/en-primeur-report-bordeaux-2022-unfulfilled-potential">Bordeaux 2022 campaign</a>, often back vintages available at a discount hold better investment potential. While <a href="https://winecap.com/news/2023-la-place-de-bordeaux-campaign">La Place</a> continues to showcase the diversity of fine wine, and remains an exciting global marketplace for New and Old World wines, the ultimate value of the releases should be judged in a broader context.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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New World releases from the autumn La Place de Bordeaux campaign

<ul>
<li>Wine classifications serve as guides to quality standards, geographical origins, and historical context.</li>
<li>The 1855 Bordeaux Classification continues to serve as a touchstone that has shaped not only Bordeaux but also global perceptions of what constitutes a ‘fine wine’. </li>
<li>Wine-producing regions worldwide have developed their own unique classification frameworks, based on quality, price, and terroir. </li>
</ul>
The classifications of fine wines provide an intriguing labyrinth of quality markers, geographic indicators, and historic relevance. Among the most iconic of these is the 1855 Bordeaux Classification – a system that has endured for over a century and a half. In contrast, the dynamic Saint-Émilion classification demonstrates the capacity for change within the realm of wine classifications. This article delves into these iconic French systems and other similar classifications in countries such as Germany, Italy, and Portugal.
<h2>The enduring legacy of the 1855 Bordeaux Classification</h2>
Commissioned by Napoleon III for the Exposition Universelle de Paris, the Bordeaux Wine Official Classification of 1855 set the gold standard for wine classifications. Designed to rank the finest wines of Bordeaux – from Médoc, Sauternes, and Barsac – the classification ranges from ‘First Growth’ to ‘Fifth Growth’, based on both quality and trading price. With only one significant modification since its inception – the promotion of Château Mouton Rothschild to First Growth in 1973 – the classification remains a cornerstone in the world of fine wine.
The classification has been both praised for its impact on the wine industry and criticised for its rigidity, given that it reflects a snapshot of quality from more than a century and a half ago. The global wine exchange, Liv-ex, has created a similar classification that uses price alone to determine a <a href="https://winecap.com/news/four-key-market-trends-from-the-2023-liv-ex-classification">hierarchy of the leading fine wine labels</a> in the market.
<h2>The Saint-Émilion Classification</h2>
In contrast to the static nature of the 1855 Classification, the Saint-Émilion region in Bordeaux has a more dynamic approach to ranking its wines. Established in 1955, the Saint-Émilion Classification is updated approximately every ten years. This system classifies wineries into tiers: Grand Cru Classé A, Grand Cru Classé B, and Grand Cru Classé.
Unlike the 1855 Classification, which is set in stone for the most part, the Saint-Émilion system allows for upward or downward mobility, giving wineries an <a href="https://www.decanter.com/wine-news/st-emilion-council-angelus-withdrawal-471967/">incentive for continuous improvement</a>.
Nonetheless, the classification has also faced controversy when three leading estates with &#8216;Premier Grand Cru Classé A&#8217; status – <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-ausone/ausone">Châteaux Ausone</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Cheval Blanc</a> and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-angelus/angelus">Angélus</a> – withdrew from the rankings last year.
<h2>Classifications beyond Bordeaux </h2>
Burgundy&#8217;s Cru System
Unlike Bordeaux, where the 1855 Classification ranks specific châteaux or estates, Burgundy&#8217;s Cru System classifies individual vineyards by assessing their terroir (Grand Cru, Premier Cru, Village, Regional).
Even vineyards that are right next to each other but separated by a road or a wall may be classified differently. The terroir is believed to impart specific qualities to the wine, with soil composition, slope, and sun exposure all playing a role.
While the 1855 Bordeaux Classification has changed very little since its inception, Burgundy’s Cru System is more fluid. Vineyards can be promoted or demoted based on ongoing assessments of quality, although changes are relatively rare and usually occur over long periods.
The Burgundy Cru System has been highly influential and is seen as a precursor to many New World terroir-based classifications. However, it&#8217;s not without its critics. Some argue that focusing solely on terroir might overlook the skills and contributions of individual winemakers.
Germany&#8217;s VDP Classification
The Verband Deutscher Prädikatsweingüter (VDP) has developed a system somewhat inspired by Burgundy. The top tier of this system, the Grosse Lage (Great Growth), designates vineyards with the highest quality potential, followed by Erste Lage (First Growth).
Italy&#8217;s Barolo and Barbaresco Cru vineyards
In Italy&#8217;s famed Barolo and Barbaresco regions, vineyards are often termed ‘cru’, reflecting the particular characteristics of the terroir. Unlike Bordeaux&#8217;s 1855 classification, there isn’t a formal hierarchy, but the cru system nonetheless signifies a level of quality and prestige.
Portugal&#8217;s Douro Classification
One of the oldest classification systems for wine comes from Portugal&#8217;s Douro region, known for Port wine. Established as early as 1756, this classification focuses on the quality of the grape-growing land, making it an early precursor to the concept of terroir.
<h2>Concluding thoughts</h2>
In the ever-evolving world of fine wine, the 1855 Bordeaux Classification continues to serve as a touchstone that has shaped not only the Bordeaux region but also global perceptions of what constitutes a ‘fine wine’. By contrast, the more dynamic systems like the Saint-Émilion rankings and Burgundy&#8217;s Cru system offer a flexible approach that accommodates change and encourages ongoing excellence. As the article explored, wine-producing regions worldwide have developed their own unique classification frameworks, each adding a different flavor to this complex narrative. Whether these systems will adapt to the challenges of climate change, evolving consumer tastes, and other modern factors remains to be seen, but what is clear is their enduring impact on how we appreciate, value, and ultimately, enjoy wine.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The legacy of the 1855 Bordeaux Wine Classification and global rankings

<ul>
<li>The fine wine market is diversifying, with Argentina and Switzerland making new entries in the 2023 Liv-ex Classification.</li>
<li>Bordeaux&#8217;s influence is waning, now accounting for less than 30% of wines in the classification, while other regions like Champagne rise in prominence.</li>
<li>Internal shifts in Burgundy indicate changing buying preferences, driven by the search for value and stock. </li>
</ul>
The <a href="https://www.liv-ex.com/2023/08/2023-liv-ex-classification-2/">Liv-ex Classification</a> is a ranking of the world’s leading fine wine labels, based solely on their price. The classification takes into account minimum levels of activity and number of vintages traded over one year to present a more accurate picture of the market today. Like the 1855 Bordeaux Classification, the wines are divided into five tiers (price bands).
The 2023 edition featured 296 wines from nine countries. It presented a broad overview of the state of the secondary market – what is trading, and at what price levels. As the market continues to evolve, we break down four key trends from the 2023 Liv-ex classification.
<h2>Continued expansion in the world of fine wine </h2>
While the number of wines that qualified for inclusion in the 2023 rankings was lower than in the previous 2021 edition (349) due to changes in the methodology, the fine wine investment market has continued to diversify.
Argentina re-entered the rankings with five wines compared to having just one in 2019. Switzerland also joined the classification for the first time with Gantenbein Pinot Noir. Meanwhile, Spain and Chile saw 40% and 100% respective increases in the number of wines entering.
Regional diversity was particularly noticeable in the second-lowest priced 4th tier (£456-£637 per 12&#215;75), which featured wines from France (24), Italy (16), Portugal (3), Australia (2), Spain (1), the USA (1), and Argentina (1).
<h2>Bordeaux among global competitors</h2>
It is no secret that Bordeaux’s dominance in the fine wine investment market has been fading since its glory days in 2009-2010. The continued broadening of the market has meant that the region has become one of many players, accounting for under 30% of the wines in the 2023 classification.
This has been further aided by its mediocre price performance relative to other regions. The Bordeaux 500 index has risen just 2.9% over the last two years, compared to a 19% move for its parental Liv-ex 1000 index, and a 36.7% increase for Champagne, which has been the best performer. All considered, Liv-ex wrote that ‘this pattern may well continue in future editions’ as new entrants challenge Bordeaux’s monopoly.
While Bordeaux&#8217;s influence wanes, other regions like Champagne are capturing the limelight.
<h2>The stellar rise of Champagne prices</h2>
Champagne has experienced a significant price surge in recent years, which has been reflected in the global rankings.
The majority of Champagnes (10) in the classification entered the first tier – wines priced above £3,641 per 12&#215;75. The remaining 12 were split between tier 2 (£1,002-£3,640) and tier 3 (£638-£1,001). There were no Champagnes in tiers 4 and 5 (wines below £1,000 per case).
The most expensive Champagne was Jacques Selosse Millésime, with an average trade price of £32,516 per case, followed by Krug’s Clos d’Ambonnay (£30,426) and <a href="https://winecap.com/wine-track/france/champagne/na/krug/clos-du-mesnil">Clos du Mesnil</a> (£17,509). The latter has risen 105% in value over the last five years.
On average, Champagne prices are up 62.8% during this time. They peaked in October 2022, following a year and a half of steady ascent. Since then, the Liv-ex Champagne 50 index has entered a corrective phase – but not significant enough to change the region’s trajectory. Sustained demand has been further buoying its performance.
<h2>Internal reshuffling in Burgundy</h2>
Burgundy, home to the most expensive wines in the rankings, has been undergoing an internal shift. New entrants have replaced many of the labels in previous editions, signalling changes in buying preferences.
Heightened demand for the region in 2022 led buyers to explore different wines within Burgundy, seeking both value and stock availability. Some of the new entrants in the 2023 classification include Prieuré Roch Ladoix Le Clou Rouge, <a href="https://winecap.com/wine-track/france/burgundy/gevrey-chambertin/domaine-louis-jadot/gevrey-chambertin-clos-st-jacques">Domaine Louis Jadot Gevrey-Chambertin Premier Cru Clos Saint-Jacques</a> and <a href="https://winecap.com/wine-track/france/burgundy/latricieres-chambertin/trapet-pere-et-fils/latricieres-chambertin">Domaine Trapet Père et Fils Latricières-Chambertin Grand Cru</a>.
Interestingly, while these new labels have entered the ranking, they seem to have replaced older, perhaps less active, Burgundy labels. Indeed, the overall proportion of Burgundy wines in the classification has remained steady, even as specific labels fall in and out of favour.
As new players emerge and existing ones adapt, one thing is clear: the fine wine market will continue to diversify and evolve, promising a fascinating future for everyone involved.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Four key market trends from the 2023 Liv-ex Classification

<ul>
<li>Sustainability in wine encompasses various processes such as environmental stewardship, social responsibility, and long-term financial viability.</li>
<li>Sustainability appeals to a growing group of investors who want their money to do good while it grows.</li>
<li>Top wineries implementing sustainable practices include Bodega Catena Zapata and Château Pontet-Canet.</li>
</ul>
The wine investment market has diversified considerably in recent years, with sustainability becoming a core focus. As examined <a href="https://winecap.com/learn/the-impact-of-climate-change-on-wine-investment">last week</a>, environmental considerations are the number one reason why UK investors choose to invest in fine wine. Today&#8217;s article explores the criteria for sustainable wine, its appeal, risks and considerations, as well as the future prospects for this important market segment.
<h2>Defining sustainable wine</h2>
Sustainability in wine is a nuanced concept that goes beyond certifications like ‘organic’ or ‘biodynamic’ that you might find on a bottle&#8217;s label. These certifications are positive indicators but they do not provide a complete picture of a wine&#8217;s overall sustainability or its quality. In fact, while organic and biodynamic practices are steps in the right direction, they are not panaceas for all environmental challenges facing vineyards and wineries.
Truly sustainable wines are produced with a broader vision that encompasses not just environmental considerations, but also social and economic aspects. This holistic approach involves responsible land use, ethical labour practices, and a focus on long-term financial viability for producers.
<h2>Organic, biodynamic, and sustainable – what is the difference?</h2>
Organic wines are made from grapes grown without synthetic pesticides or fertilisers. Biodynamic wines take this a step further by integrating the vineyard into a self-sustaining ecosystem.
Sustainable wines, however, encompass a broader range of practices aimed at the long-term viability of the entire wine-producing operation. Various certifications, such as ‘Certified California Sustainable Winegrowing’, exist to label these wines officially. Organisations such as <a href="https://sustainablewine.co.uk/">Sustainable Wine</a> work to enhance clarity around sustainability in the industry as a whole from viticulture to packaging solutions and logistics.
<h2>The appeal of sustainable wines</h2>
Sustainability appeals to a growing cohort of investors who want their money to do good while it grows. Investing in sustainable wines satisfies this ethical imperative, thereby adding another layer of attraction to the investment.
Studies indicate a <a href="https://wineinstitute.org/press-releases/consumer-trade-research-shows-increased-demand-for-sustainably-produced-wine/#:~:text=Their%20research%20indicates%20increasing%20market,increasingly%20embracing%20sustainable%20winegrowing%20practices.">rising demand for sustainable products</a>, including wine. This increased consumer demand means greater sales potential and, by extension, a probable rise in value for these wines over time.
Sustainable wines often come with compelling stories of environmental stewardship and community support. This narrative adds a unique selling proposition that can boost brand value and investment potential.
<h2>Risks and considerations</h2>
Like any investment, putting money into sustainable wines is not without risk. Market volatility, consumer preferences and supply and demand can impact returns as with any other investment-grade wine.
Another risk lies in the potential for ‘greenwashing’, where a wine&#8217;s eco-friendly credentials can be exaggerated. Investors must perform due diligence to ensure they are backing genuinely sustainable ventures.
<h2>How to invest in sustainable wines</h2>
The first step is comprehensive research: utilising online resources, expert reviews, and consumer reports to assess a wine&#8217;s investment potential and sustainable credentials. Diversifying your portfolio by including a mix of sustainable wines from various regions and price points can mitigate risks and increase the potential for rewards.
Pay close attention to ratings from renowned wine critics and industry experts. A high <a href="https://winecap.com/learn/the-role-of-wine-ratings-in-fine-wine-investment">rating can significantly impact</a> a wine’s market value.
<h2>Sustainability pioneers</h2>
Several wineries around the world are setting the bar high for sustainable practices. Frog&#8217;s Leap in Napa Valley is known for its organic and dry farming techniques. Germany&#8217;s Weingut Wittmann has also embraced organic farming and natural winemaking processes. In Argentina, <a href="https://winecap.com/wine-track/argentina/mendoza/na/catena-zapata/adrianna-malbec-">Bodega Catena Zapata</a> stands out for its sustainable farming and research into high-altitude winemaking. <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-pontet-canet/pontet-canet">Château Pontet-Canet</a> in Bordeaux is another success story, having converted to biodynamics in 2014 after various setbacks in 2007. Their journey underscores the long-term dedication needed for truly sustainable winemaking.
<h2>Future outlook</h2>
From water-saving technologies to renewable energy, the wine industry is continually adopting more sustainable practices, pointing to a robust market future. <a href="https://www.researchgate.net/publication/273855407_Millennial_generation_attitudes_to_sustainable_wine_An_exploratory_study_on_Italian_consumers">Experts predict</a> the demand for sustainable wines will only grow, particularly as younger generations who prioritise sustainability come of age.
Sustainable wines present a captivating new frontier in wine investment, promising both ethical satisfaction and financial gains. As with any investment, there are risks, but the burgeoning market for these wines, coupled with their unique branding advantages, makes them a trend worth watching. For investors willing to do their homework, the opportunity is ripe for the picking.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Is sustainable wine the next big investment trend?

<ul>
<li>La Place de Bordeaux is a three-tier global wine distribution system with origins stretching back 800 years.</li>
<li>The autumn La Place de Bordeaux campaign sees the release of over 100 different wines from around the world. </li>
<li>Discover the brands released via La Place that have made the biggest gains over the past decade.</li>
</ul>
La Place de Bordeaux is a global wine distribution system that originated 800 years ago in France. The network was originally a hub used just for Bordeaux’s finest wines, where the château would sell to négociants who then sell to merchants.
In recent years, the system has considerably expanded its operations. Other than the spring Bordeaux En Primeur campaign, today La Place releases wines from other parts of the world in the autumn.
Over 100 different wines from Argentina, Australia, the USA, New Zealand, Austria, China, Italy, Spain, South Africa, Uruguay and French wines from Champagne and the Rhône have joined the marketplace since the first non-Bordeaux release of the Chilean brand Almaviva in 1998.
<h2>What is driving the La Place expansion?</h2>
By selling through La Place, producers have the opportunity to build a global following for their brands, benefitting from the négociants’ extensive reach and expertise in promoting and allocating wines to different markets. Meanwhile, this process guarantees the wines’ provenance, reduces risk, and effectively manages supply and demand.
Négociants also benefit from the expansion of the system beyond Bordeaux by diversifying their revenue streams and reducing their dependency on the châteaux. This is especially true in recent years, which have seen a declining sentiment for buying Bordeaux En Primeur (for more, see our <a href="https://winecap.com/learn/en-primeur-report-bordeaux-2022-unfulfilled-potential">En Primeur Report: Bordeaux 2022 – Unfulfilled Potential</a>).
The transformation of La Place de Bordeaux also reflects the shift in broadening buying patterns in the fine wine investment market.
<h2>La Place brands to watch</h2>
This autumn will see the release of close to 120 wines from around the world through La Place de Bordeaux.
Some of the most anticipated releases each year include the Super Tuscans Solaia, Masseto and Bibi Graetz, Californian cult wine Opus One joined by estates such as Inglenook, Joseph Phelps and Promontory, the Chilean Almaviva, Vinedo Chadwick and Viña Seña.
Australian wine, which has faced challenges due to the ongoing <a href="https://www.theguardian.com/world/2023/aug/04/china-australia-barley-tariffs-scrapped-removed-trade-tensions">Chinese tariffs</a> in recent years, has also been aided by the network, with brands such as Penfolds and Jim Barry making waves.
<img loading="lazy" decoding="async" class="alignnone wp-image-1666" src="https://wp.winecap.com/wp-content/uploads/2023/08/La-Place-brands-375x187.png" alt="La Place brands" width="800" height="399" srcset="https://wp.winecap.com/wp-content/uploads/2023/08/La-Place-brands-375x187.png 375w, https://wp.winecap.com/wp-content/uploads/2023/08/La-Place-brands-768x383.png 768w, https://wp.winecap.com/wp-content/uploads/2023/08/La-Place-brands-1200x598.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/08/La-Place-brands.png 1280w" sizes="(max-width: 800px) 100vw, 800px" />
*Explore the performance of different wines on <a href="https://winecap.com/wine-track/">Wine Track</a>, our comprehensive fine wine index that enables you to identify investment grade wines, spot trends and wine investment opportunities.
The table above shows some of the best-performing wines released via La Place over the past decade. These wines, available at various price points, have delivered an all-round positive performance over the past five and ten years.
Rothschild &amp; Concha Y Toro’s <a href="https://winecap.com/wine-track/chile/central-valley/maipo-valley/rothschild-&amp;-concha-y-toro/almaviva">Almaviva</a> has seen the most impressive price performance over the last decade, up 132%. Almaviva prices tend to rise with age, and the highly anticipated 2021 vintage is expected to be among the first releases of this autumn’s campaign.
In conclusion, the network&#8217;s continually broadening selection showcases its ability to adapt and thrive in a fluid market, acting simultaneously as an indicator of shifting consumer preferences and investment opportunities. As négociants broaden their range and producers tap into this distribution channel with global reach, the impact is poised to resonate well beyond the borders of Bordeaux.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

The brands to watch in the 2023 autumn La Place de Bordeaux campaign

<ul>
<li>Environmental considerations are the number one reason why UK investors choose to invest in fine wine.</li>
<li>Fine wine itself is facing the effects of climate change such as reduction in yields. </li>
<li>Scarcity can drive demand and prices higher, but also lead to the broadening of the fine wine market.</li>
</ul>
Climate change and environmental considerations are the number one reason why UK investors choose to invest in fine wine, according to the results of our <a href="https://winecap.com/learn/uk-wine-investment-report">Global Wealth Manager Survey 2023</a>. Over half (54%) of our respondents cited fine wine’s low carbon footprint as a key reason for adding it to their portfolio.
While there is a strong case <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">why fine wine can be considered an ESG investment</a> that is a good for the environment, fine wine itself is facing the impact of climate change. Like all agriculture, viticulture is at the mercy of the environment, making climate change a pressing issue for wine investors.
Changing weather patterns affect wine quality and quantity – two of the main factors that can make an investment profitable.
<h2>How changing weather patterns affect wine quality and quantity</h2>
In general, climate change can lead to alterations in grape ripening cycles, water stress, diseases and pests, and can affect berry size and composition.
Rising temperatures can cause early ripening, potentially disrupting the balance of sugars, acids and tannins – factors crucial for the quality of the wine and its ageing potential. Meanwhile, drought and irregular rainfall can lead to excessive water stress in the vines, affecting fruit development. Warmer temperatures can also bring new pests and diseases to regions previously unaffected, while heatwaves can cause grapes to sunburn, reducing yield and quality.
For instance, in 2023, two of the main fine wine producing countries, <a href="https://winecap.com/news/2023-harvest-forecasts-for-france-and-italy-a-balancing-act">France and Italy</a>, faced diverse weather patterns. France’s 2023 wine harvest projects between 44-47 million hectolitres, benefiting from potentially strong yields in Champagne and Burgundy. Italy, however, might see up to 14% reduction in yields due to extreme weather, marking it among its smallest harvests.
<h2>What does this mean for fine wine investment</h2>
Smaller harvests lead to reduced supply, and assuming that demand remains constant or increases, prices tend to rise. When news of a small harvest breaks, especially from a reputable wine-producing region, it can create a buzz in the trade. Buyers and collectors might perceive wines from that harvest as more valuable or unique, driving up demand and, subsequently, prices.
Moreover, a smaller harvest doesn&#8217;t necessarily mean reduced costs. Wineries still have to maintain vineyards, pay labour, and cover all production expenses. With fewer bottles to sell, the cost per bottle increases, which can result in higher prices for the consumer.
<h2>Supply and demand</h2>
This is a particularly pertinent question for regions, where scarcity is the main driver behind their investment appeal such as Burgundy. A recent example was the 2021 Burgundy En Primeur campaign, which saw drastically low volumes. The Bourgogne Wine Board (BIVB) pointed to a crop of 900 to 950,000 hectolitres, representing about 50% of a normal year and 2/3 of the average in recent years.
As a result, allocations were low and release prices were up 25% on average. This stimulated demand for older vintages at comparatively low prices, such as 2012, 2014 and 2017, as examined in our <a href="https://winecap.com/learn/q1-2023-fine-wine-report">Q1 2023 report</a>.
Overall, climate change can create scarcity in the market, pushing the entry point into some fine wine regions higher.
<h2>The broadening fine wine market</h2>
The rarity of some wines is leading buyers to also consider alternatives from other regions, impacting the size of the market. Today there are more fine wine investment opportunities than in any other point in history.
Changing weather patterns have also led to the emergence of new wine producing regions. For instance, England is now producing award-winning sparkling wines, due to warming temperatures. The country is still a niche player in the investment market, but some brands such as Nyetimber and Gusbourne Estate are making waves.
Climate change is reshaping the fine wine market, with some of the traditional regions forced to adapt their strategies. It is more than an abstract global concern; its palpable effects are shaping the fine wine industry, from agriculture to investment.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The impact of climate change on wine investment

<ul>
<li>Italian fine wine has demonstrated resilience during the market’s latest corrective phase.</li>
<li>Piedmont and Tuscany have shaped the Italian fine wine market in complementary ways.</li>
<li>In the last year, Bibi Graetz Testamatta has been the best performing brand from Tuscany, up 93%, while Marchesi di Barolo Riserva has led the way in Piedmont, up 128%.</li>
</ul>
Italy has been a beacon of stability during the fine wine market’s latest corrective phase, which has seen prices fall 7.5% over the last year. The Italy 100 index has dipped just 0.4% during this time, but many of its top wine brands have continued to make considerable gains.
Italy’s stability is more than just a short-term trend; its long-term performance has been characterised by low volatility and steady returns. Its index has risen 286% in value over the last two decades, driven by growing demand for Italian fine wine, and quality improvements.
Indeed, the top wines of Piedmont and Tuscany compare favourably to Burgundy and Bordeaux in terms of critic scores, yet prices are often lower. Italy entices buyers with lower-cost access into the fine wine market, and the diversity of its offerings. On average, one can get a case of the top Super Tuscans (Tignanello, Sassicaia, Ornellaia) for £2,129; the First Growths (Mouton Rothschild, Haut-Brion and Margaux) cost more than double.
<h2>The complementary performance of Piedmont and Tuscany </h2>
Two major regions have played pivotal roles in shaping the Italian fine wine market in complementary ways: Piedmont and Tuscany.
Piedmont’s top wines, chiefly made from the native Nebbiolo grape, are produced in limited quantities, with rarity and exclusivity driving demand and prices. The dynamics behind the region’s performance evoke comparisons with Burgundy (and its signature Pinot Noir), where scarcity intensifies the allure. Historically, Piedmont has been the chief driver behind Italy’s rising prices.
Meanwhile, Tuscany has greatly contributed to cementing Italy’s place on the global fine wine stage, and its increasing market share. The brand strength of the Super Tuscans, combined with high quality, greater volumes and solid liquidity, have given the Italian market a significant boost.
<h2>The best performing brands in the last year</h2>
Piedmont
<img loading="lazy" decoding="async" class="alignnone wp-image-1657" src="https://wp.winecap.com/wp-content/uploads/2023/08/Piedmont-best-performers-375x193.png" width="800" height="411" srcset="https://wp.winecap.com/wp-content/uploads/2023/08/Piedmont-best-performers-375x193.png 375w, https://wp.winecap.com/wp-content/uploads/2023/08/Piedmont-best-performers-768x395.png 768w, https://wp.winecap.com/wp-content/uploads/2023/08/Piedmont-best-performers.png 1186w" sizes="(max-width: 800px) 100vw, 800px" />
*Explore the performance of different wines on <a href="https://winecap.com/wine-track/">Wine Track</a>, our comprehensive fine wine index that enables you to identify investment grade wines, spot trends and wine investment opportunities.
Marchesi di Barolo Barolo Riserva leads the way among Piedmont’s biggest risers, up an impressive 128% in the last year. However, the rest of the wines have made gains between 39% and 47%.
Tuscany
<img loading="lazy" decoding="async" class="alignnone wp-image-1658" src="https://wp.winecap.com/wp-content/uploads/2023/08/Tuscany-best-performers-375x184.png" width="800" height="393" srcset="https://wp.winecap.com/wp-content/uploads/2023/08/Tuscany-best-performers-375x184.png 375w, https://wp.winecap.com/wp-content/uploads/2023/08/Tuscany-best-performers-768x378.png 768w, https://wp.winecap.com/wp-content/uploads/2023/08/Tuscany-best-performers.png 1139w" sizes="(max-width: 800px) 100vw, 800px" />
From Tuscany, Bibi Graetz Testamatta has seen the biggest rise in value in the last year, up 93%. The wine has an attractive point of entry, with an average case price of £1,530. Some of its best value vintages include 2011, 2012, 2015 and 2016. The 2021 vintage is expected to be released next month, as part of this autumn’s La Place de Bordeaux campaign.
The rest of Tuscany’s best performers have risen between 40% and 67%, with Antinori’s Guado al Tasso at the higher price end and Montevertine Rosso being the lowest priced.
The significant growth observed in individual brands from both regions accentuates Italy’s investment potential. Despite the recent bearish trend in the market, Italy has continued to deliver and attract greater demand.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Italian fine wine shows resilience amid market corrections

<ul>
<li>Risk in investing refers to the potential for higher long-term rewards but also the possibility of losses.</li>
<li>High-risk investments can provide significant returns, but they also come with increased potential for losses.</li>
<li>Fine wine can be a low-risk investment with high growth potential and a hedge against inflation.</li>
</ul>
<h2>Understanding risk in investing</h2>
In the context of investing, risk signifies the potential variability of returns. It reflects the likelihood that the actual return on an investment may deviate from its expected return, which could mean either losing money or making more than anticipated.
Risk is usually calculated using statistical measures such as standard deviation and variance, which represent the degree to which an investment&#8217;s returns can vary from its average return. Greater variability implies higher risk and vice versa.
<h2>What does risk tolerance really mean?</h2>
Contrary to popular belief, risk tolerance is not about being an adrenaline junkie or being willing to lose all your money. It&#8217;s about your ability to endure potential losses in your investment portfolio without panicking or making rash decisions.
Risk tolerance depends on various factors, including your financial capacity to absorb losses, your investment goals, your time horizon (the length of time you plan to keep your money invested), and your emotional comfort with uncertainty and potential loss.
In long-term investments, it can actually be riskier for your wealth to invest solely in traditionally &#8220;low-risk&#8221; assets. This is because these assets may not provide the growth needed to achieve your investment goals, especially after accounting for inflation.
<h2>High-risk investments: high return or high loss?</h2>
<a href="https://www.investopedia.com/terms/r/risk-asset.asp#:~:text=Risk%20assets%20are%20assets%20that,%2C%20real%20estate%2C%20and%20currencies.">High-risk investments</a> experience significant price volatility, such as equities, commodities, high-yield bonds, and currencies. These usually have the potential to generate substantial returns; however, they can also lead to significant losses, including the entire amount invested in some cases.
While high-risk investments can be a part of a diversified portfolio, it is crucial to only invest money that you can afford to lose in these types of assets. And, most importantly, these investments should align with your risk tolerance.
<h2>Fine wine: a low-risk asset with high growth potential</h2>
Fine wine presents an intriguing investment prospect, particularly for those with a lower risk tolerance. As a tangible, finite asset, fine wine tends to appreciate with time and offers a level of stability that is often appealing to risk-averse investors.
Moreover, fine wine has shown high growth potential, with certain wines appreciating significantly over time. Some of the best investments in the last five years have been <a href="https://winecap.com/wine-track/france/burgundy/vosne-romanee/prieure-roch/vosne-romanee-clos-goillotte">Prieure Roch Vosne-Romanee Le Clos Goillotte</a> (588%), <a href="https://winecap.com/wine-track/france/champagne/na/egly-ouriet/brut-millesime">Egly-Ouriet Brut Millesime Grand Cru</a> (340%) and various wines from Domaine Leroy and Domaine Arnoux-Lachaux. Similarly, the fine wine regions that have seen the highest return on average in the last semi-decade have been Champagne (69.9%) and Burgundy (35.5%).
Our Wine Track tool allows you to explore the <a href="https://winecap.com/wine-track/">best performing wines over different time frames</a>, the price point upon which they are available, and their <a href="https://winecap.com/learn/the-role-of-wine-ratings-in-fine-wine-investment">average critic score</a>.
Understanding risk and your personal risk tolerance is essential in making sound investment decisions. Whether it&#8217;s high-risk or low-risk assets, or a combination of both, the key is to align your investments with your personal risk tolerance and financial goals. With its unique attributes, fine wine offers an exciting avenue for those seeking lower-risk investments with substantial potential returns.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Risk tolerance in investing: the role of fine wine

<ul>
<li>France&#8217;s 2023 wine harvest projects between 44-47 million hectolitres, benefiting from potentially strong yields in Champagne and Burgundy.</li>
<li>Italy anticipates up to 14% reduction in its 2023 harvest due to extreme weather, marking it among its smallest harvests.</li>
<li>Historical trends showcase climatic vulnerabilities, emphasising the need for sustainable viticulture practices.</li>
</ul>
As harvest time approaches, we take a look at forecasts for the 2023 vintage in France and Italy. While France appears to be set for a stable year – in line with the five-year average, Italy’s harvest might shrink as a result of extreme weather, as climate change continues to leave its mark.
<h2>French wine regions face diverse conditions</h2>
According to the French agriculture ministry, France&#8217;s wine harvest in 2023 looks promising, with estimates suggesting a national production between 44 million and 47 million hectolitres. This figure nudges slightly ahead of the previous year&#8217;s 45.4 million hectolitres. One reason for optimism is the performance in regions like Champagne and Burgundy, which is expected to offset challenges in Bordeaux.
Indeed, Bordeaux has not had it easy. Consecutive thunderstorms, high temperatures, and downy mildew have plagued the region. Notably, Gironde&#8217;s chamber of agriculture reported that a whopping 90% of vines have been affected by downy mildew. Languedoc and Roussillon have also been suffering from persistent drought.
Meanwhile, Champagne and Burgundy are set for an above-average harvest. Champagne has successfully averted frost and hail damage and diseases have been contained. Similarly, Burgundy looks poised for grape production higher than the five-year average. The situation in neighbouring Beaujolais is also looking better than last year.
If projections hold, France may place as Europe&#8217;s largest wine producer in 2023, especially given the challenging outlook for Italy.
<h2>Italy’s climate woes</h2>
Italy is staring at a potentially reduced harvest in 2023. From searing heatwaves to devastating floods, the nation&#8217;s vintners have confronted multiple challenges. Extreme weather events could result in a harvest that is up to 14% smaller than in 2022. If this forecast proves accurate, 2023 could rank with years like 1948, 2007, and 2017 as one of Italy&#8217;s smallest harvests on record.
However, while the national outlook seems daunting, the situation varies by region. The north, including areas like Piedmont, Lombardy, and Veneto, has remained relatively stable despite recent fierce hailstorms. By contrast, southern and central Italy might see significant drops in production, with Sicily in particularly struggling with wildfires, heat, and mildew. Still, the Assovini Sicilia wine association noted that grape quality remains intact for 2023.
<h2>Historical context</h2>
France and Italy have witnessed harvest highs and lows over the decades. Historically, France&#8217;s most significant harvest was in 2004 with a record 58.3 million hectolitres. In contrast, 2017 saw a decline of almost 20% due to weather adversities.
Italy&#8217;s bumper harvest year was 1982, with a record production of 65 million hectolitres. The country&#8217;s most challenging years have been spaced apart, with significant lows in 1948, 2007, and potentially 2023.
In conclusion, the 2023 harvest projections for France and Italy offer a revealing snapshot into the challenges and opportunities presented by the ever-shifting climate. While France gears up for a potentially favorable yield, owing largely to robust performances in regions like Champagne and Burgundy, Italy grapples with the stark realities of climate change, which threatens to render 2023 one of its leanest harvests. These trends not only highlight the adaptability of the wine industry but also underscore the urgent need for sustainable practices and proactive measures to mitigate the impacts of adverse weather patterns on viticulture. As the historical data indicates, while wine-producing regions have faced fluctuations in the past, the growing unpredictability of climate patterns demands heightened vigilance and innovation in the realm of winemaking.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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2023 harvest forecasts for France and Italy: a balancing act

<ul>
<li>Diversification is a risk management strategy that involves spreading investments across various financial instruments, sectors, and regions.</li>
<li>It is not just about different sectors and asset classes but also about different revenue streams.</li>
<li>Fine wine can serve as a practical alternative investment, providing portfolio diversification and being a hedge against inflation.</li>
</ul>
<h2>Understanding diversification</h2>
Diversification, often referred to as the only ‘free lunch’ in investing, is a cornerstone of modern portfolio theory. At its core, it is a risk management strategy used in investing where one spreads their investments across various financial instruments, sectors, and regions.
The goal of diversification is to mitigate risk by reducing the negative impact of a poor-performing investment on the overall portfolio. This is achieved by investing in assets that are not perfectly correlated. In simpler terms, when some investments are down, others may be up.
<h2>Debunking the diversification myth</h2>
A common myth in investing is that diversification only means investing in different sectors, asset classes, and locations. While these are significant aspects of diversification, it is not the whole story.
The essence of diversification is about establishing multiple revenue streams. The importance of different revenue streams cannot be overstated. The reason being, if one stream suffers due to economic downturns or sector-specific issues, the impact on the total income is cushioned by the performance of other streams. It is all about not putting all your eggs in one basket.
For instance, consider an investment portfolio that has stocks, bonds, and real estate investments. Even if the stock market faces a downturn, the bond market may still perform well, and rental income from real estate could continue to provide stable income. This way, different revenue streams ensure the portfolio remains balanced and resilient in the face of volatility.
<h2>Fine wine: an alternative avenue for diversification</h2>
When we talk about diversification, alternative investments often come into play. These can range from art and antiques to cryptocurrencies and fine wine. Fine wine as an asset class for investment purposes has been gaining traction over the past decade.
Fine wine offers several attractive characteristics as a diversification asset. It is tangible, finite, and its value tends to increase with age, making it a useful hedge against inflation. Moreover, the performance of wine as an asset class does not necessarily correlate with traditional financial markets, providing the much-needed diversification.
In periods of financial crisis, where traditional stocks and bonds may underperform, alternative investments like wine often remain steady or even appreciate. This is partly because they are driven by different demand dynamics – for example, the increasing global appreciation of fine wines, especially in emerging markets.
Investing in wine also offers the potential for impressive returns. A well-chosen wine portfolio can deliver strong performance over time. You can now see the best and worst performing wines over the last year on <a href="https://winecap.com/wine-track/">Wine Track</a>.
<a href="https://winecap.com/wine-track"><img loading="lazy" decoding="async" class="alignnone wp-image-1640" src="https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track-375x123.png" width="750" height="246" srcset="https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track-375x123.png 375w, https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track-768x252.png 768w, https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track-1536x503.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track-1200x393.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/08/Wine-Track.png 1826w" sizes="(max-width: 750px) 100vw, 750px" /></a>
<h2>Diversification within fine wine</h2>
Diversification also exists in the fine wine market. All wines are not made the same. Wines from different regions can deliver varying returns so it is important to have a broad understanding of the market dynamics that may affect performance over time.
For instance, rare Burgundies are known for delivering exceptional returns; however, the entry point tends to be higher, prices are more volatile, and the wines are harder to source. Bordeaux and the Rhône tend to offer greater stability at lower price points, but returns might not be as impressive.
Moreover, different factors may affect performance: while Champagne prices tend to exhibit greater correlation with age – as the wines mature, prices rise – the Bordeaux market tends to be influenced by critic scores and vintage quality. Scarcity, demand and supply, significant events, critic rankings, changes in ownership and the ‘death effect’ are other fine wine specific factors that can affect the performance of different regions.
In conclusion, while diversification may seem like a complex concept, it is a fundamental strategy in managing risk and ensuring the growth of your investment portfolio. Whether it is stocks, bonds, real estate, or fine wine, the idea is to spread out your investments, thereby creating different revenue streams to safeguard against market volatility. With its unique characteristics, fine wine offers an exciting opportunity to achieve portfolio diversification.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The art of diversification: can fine wine create it?

<ul>
<li>Wine ratings play a crucial role in wine investment, with high scores from influential critics impacting demand and market value.</li>
<li>To use ratings effectively, investors should consider both the initial score and potential for growth.</li>
<li>The Wine Track score provides a broader view of a wine&#8217;s quality across multiple vintages and publications, helping investors assess wines at a glance.</li>
</ul>
For many investors, fine wine offers a fascinating, enjoyable, and potentially profitable venture. However, the wine market is highly nuanced, requiring a keen understanding of various factors influencing wine values. One such factor, critical to successful wine investment, is the wine rating system. This score, given by wine critics to a particular bottle or vintage, can dramatically impact its market value and demand.
Wine ratings, typically on a 100-point scale, offer a quantitative measure of the wine&#8217;s quality. The ratings of influential critics such as Robert Parker, Neal Martin and Wine Spectator can have a significant impact on the market value of a wine. This is why savvy investors pay close attention to these scores, as they can quickly identify high potential investments.
<h2>The power and influence of ratings</h2>
However, it&#8217;s not enough to simply buy wines with high ratings. The rating system is far more nuanced, with the potential for dramatic shifts in a wine&#8217;s rating over time. A wine may be rated in its youth, then again as it matures. In some cases, a wine&#8217;s rating may increase as it develops, making it an excellent investment if purchased early. Conversely, a wine that doesn&#8217;t mature as expected can see its rating (and value) drop.
<h2>How critics have moved the wine market</h2>
Some historical examples illustrate the power that critics wield in the wine investment market:
<ul>
<li>Robert Parker and the 1982 Bordeaux vintage: Parker’s high scores for the 1982 Bordeaux wines went against the grain of other critics, and as the wines matured and proved him right, their market values soared.</li>
<li>James Suckling and Super Tuscan wines: Suckling&#8217;s high scores and positive reviews in the 1980s and 90s for these non-traditional Italian wines helped elevate their status and market prices.</li>
<li>Jancis Robinson and Austrian wines: Robinson&#8217;s praise for the quality and complexity of wines from Austria increased their international profile and market value.</li>
<li>Robert Parker and Napa Valley: Parker’s positive reviews of Napa Valley Cabernet Sauvignon and Bordeaux blends in the 1990s contributed to increased demand and higher prices for these wines.</li>
<li>Wines Spectator’s Wine of the Year: Wine Spectator, one of the most influential wine publications globally, selects its &#8220;Wine of the Year&#8221; based on quality, value, availability, and an X-factor they call &#8220;excitement.&#8221; The wine usually becomes a hot commodity in the secondary market, breaking all-time trading record within the day of the announcement, like Marques Murrieta Castillo Ygay Gran Reserva Especial 2010 in 2020.</li>
</ul>
<h2>Knowing the critics and selling wine</h2>
To use ratings effectively, investors should consider both the initial score and potential for growth. Some wines, especially those from renowned producers in prestigious regions like Bordeaux or Burgundy, are consistently well-rated and have a history of aging well. However, there are also opportunities to find &#8220;sleeper&#8221; wines – those with moderate initial ratings that improve significantly over time.
A key part of understanding and using wine ratings is understanding the critics. Each has a different palate and preference, and their ratings reflect these tastes. Robert Parker, for instance, was known for favouring bold, robust wines from Bordeaux, California, and the Rhône. However, since Parker&#8217;s retirement, the wine criticism landscape has been undergoing a gradual shift, reflecting changing consumer preferences and a growing appreciation for diversity in wine styles, such as lighter and lower-alcohol wines.
<h2>The Wine Track score – ratings at a glance</h2>
Now it is also possible to access a brand’s average score thanks to the <a href="https://winecap.com/wine-track">Wine Track score</a>. The Wine Track score provides a broader view of a wine&#8217;s quality across multiple vintages, which can be particularly useful for potential investors seeking a more comprehensive evaluation of a wine&#8217;s investment potential.
It aggregates multiple wine vintages of a wine to create a score out of 100. It unifies more than 100 wine critics’ scores from 12 global publications that use different methodologies. By providing a combined score, it helps investors assess wines on the fine wine market at a glance.
In conclusion, while wine ratings are not the sole determinant of a wine&#8217;s investment potential, they play an integral part in the wine investment strategy. With careful consideration and a well-rounded understanding of the wine market, investors can utilise these ratings to guide their purchases and optimise their portfolios.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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The role of wine ratings in fine wine investment

<ul>
<li>The fine wine market softened in H1 2023 amid a complex economic landscape, creating opportunities for savvy investors to purchase well-priced stock. </li>
<li>The 2022 Bordeaux En Primeur campaign stimulated demand for older Bordeaux vintages, which in turn pushed their prices.</li>
<li>Sweet Bordeaux dominated the best-performing wines in H1 2023, with Château Climens 2014 claiming the top spot.</li>
</ul>
<h2>Market overview </h2>
The first half of 2023 brought a mixed bag of developments for the fine wine market, with interesting shifts underway. Amid a complex economic landscape, the market softened, creating opportunities for savvy investors to purchase high-quality stock at appealing prices. Major fine wine indices experienced a minor slump when calculated in sterling but remained steady in other currencies.
Meanwhile, the 2022 Bordeaux En Primeur campaign generated excitement among critics and buyers due to the high quality of the wines, yet its pricing underlined the value that back vintages offer. Indeed the majority of the best-performing wines so far this year have been older Bordeaux vintages, with two exceptions.
<h2>The top performers so far this year</h2>
While major fine wine indices have experienced a slowdown, demand remains robust and some wines have continued to overdeliver. The table below shows the best performers in H1 2023, which have all risen between 18% and 78%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1625" src="https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-wines-h1-375x127.png" width="750" height="253" srcset="https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-wines-h1-375x127.png 375w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-wines-h1-768x259.png 768w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-wines-h1-1200x405.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-wines-h1.png 1351w" sizes="(max-width: 750px) 100vw, 750px" />
Five out of the top ten spots, including the prime position, have gone to Château Climens. Much of this stellar growth happened in the last quarter. Back vintages saw increased demand, following the 2022 En Primeur release, which was offered with a 139.4% increase on the 2016. Château Climens has also been one of the best-performing Bordeaux brands so far this year, according to <a href="https://winecap.com/wine-track/france/bordeaux/barsac/chateau-climens/climens">Wine Track</a>, rising 36%.
Another wine from Barsac, Château Coutet 2014, has also risen an impressive 32.8% in value over the past six months, cementing the prevalence of sweet Bordeaux among the biggest risers. It seems that a category often overlooked has come to the investment spotlight in 2023, replacing the stars of 2022 – Burgundy and Champagne.
The sixth and seventh spots went to red Bordeaux, with Château Palmer 2013, up 27.4%, and Le Clarence de Haut-Brion 2015, up 24.1%.
The exceptions to the Bordeaux-themed half were Giacomo Conterno Barolo Monfortino Riserva 2001 (22.8%) and Joseph Drouhin Montrachet Grand Cru Marquis de Laguiche 2011 (18.2%).
To find out more about the most recent developments in the fine wine market, download our <a href="https://winecap.com/learn/q2-2023-fine-wine-report">Q2 2023 wine investment report</a>.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The best-performing wines in H1 2023

<ul>
<li>The Bordeaux 2013 vintage saw a tepid response at release due to challenging weather conditions that impacted its quality and quantity.</li>
<li>The vintage provided a low entry point into top Bordeaux brands, and interesting investment opportunities.</li>
<li>Ten years on, some wines have risen over 200% in value, including second wines Petit Mouton and Carruades de Lafite. </li>
</ul>
As the 2013 Bordeaux vintage sees its tenth anniversary, critics are once again turning their attention to these wines. Our retrospective provides a glimpse into the market performance of the vintage, and the best-performing wines today.
<h2>Bordeaux 2013: a difficult year for winemaking</h2>
Bordeaux&#8217;s 2013 vintage was met with lukewarm reception upon release, primarily due to adverse weather conditions that took a toll on both its quality and quantity. Coming on the heels of two poorly priced campaigns did not help either.
A wet winter transitioned into an equally damp spring, delaying budburst and resulting in many grapes suffering from coulure. Unpredictable temperature fluctuations, frost, and an extraordinarily rainy May led to a disrupted flowering in June, further complicating the growing season.
July brought extreme heat, one of the hottest in over six decades, culminating in torrential rainstorms that significantly reduced yields in the Médoc and Pessac-Léognan appellations. August continued the trend with destructive hailstorms in the Entre-deux-Mers region. Consequently, growers were forced to discard damaged and unripe berries, causing further reductions in yield.
<h2>A mixed bag</h2>
Despite the less-than-ideal weather conditions, certain areas and grape varieties fared better than others. Saint-Estèphe, for instance, benefited from a drier growing season, resulting in some of the most successful wines of that year. Late-ripening varieties like Cabernet Sauvignon also made the best of the limited summer weather. However, earlier-ripening varieties like Merlot struggled due to the damp, cold start to the year.
In general, the 2013 vintage yielded smaller quantities of wine with dramatic variations in quality. The best reds were light, with lower alcohol content and a fresh fruity character, whereas the less successful examples were marked by overextraction and astringent tannins. Whites performed better overall, the best of which possessed aromatic freshness.
In terms of style, Bordeaux 2013 significantly deviates from the richer, sunnier vintages of recent years. It has produced lighter-bodied wines imbued with a tangy acidity, making them more suitable for short- to medium-term drinking rather than long-term cellaring. Many of the wines are now ready to drink.
<h2>A lower entry point into the market for Bordeaux</h2>
The inconsistency in quality led to a range of price points in the market. This presented an opportunity to acquire Bordeaux wines at lower prices than usual, especially those from estates with a proven track record of producing high-quality wines in challenging years.
This made the vintage an interesting entry point for those looking to invest in Bordeaux without the high initial price that other ‘on’ vintages command – a trend identified among buyers in Asia, and particularly for the First Growths and their second wines.
This has stimulated investment interest in the vintage, and some Bordeaux 2013 wines have seen considerable price appreciation, delivering over 200% returns in less than a decade.
<img loading="lazy" decoding="async" class="alignnone wp-image-1613" src="https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-Bdx-2013-wines-375x113.png" width="750" height="226" srcset="https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-Bdx-2013-wines-375x113.png 375w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-Bdx-2013-wines-768x232.png 768w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-Bdx-2013-wines-1200x362.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/07/best-performing-Bdx-2013-wines.png 1482w" sizes="(max-width: 750px) 100vw, 750px" />
<h2>A vintage for second wines</h2>
Four second wines are among the best performing Bordeaux 2013s. The second wine of Château Mouton Rothschild, Petit Mouton, leads the way with a 233% rise since release. The wine offered a low entry point into the brand at £750 per case; by comparison, this year’s 2022 vintage was released for £2,196 per 12&#215;75.
The second wine of Château Lafite Rothschild has been the second-best performing label, up 230% in value since release.
Pavillon Rouge du Château Margaux and Le Clarence de Haut-Brion also feature among the biggest risers, with increases of 163.9% and 142.4% respectively.
<h2>Bordeaux 2013 – an unexpected opportunity</h2>
A decade on, the Bordeaux 2013 vintage has shown that even in challenging growing conditions, wines of interest and value can be produced. The vintage offered a lower entry point into Bordeaux, resulting in several significant performers. The legacy of the Bordeaux 2013 vintage may well be seen as a fascinating anomaly – an unexpected opportunity for wine collectors and investors.
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WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

Ten years on: the top-performing Bordeaux 2013 wines

Our Q2 2023 report has now been released. The report examines the macroeconomic factors affecting fine wine demand, the Bordeaux 2022 En Primeur campaign, recent winery acquisitions and other industry news.
<h2>Key findings include:</h2>
<ul>
<li>UK and US stocks experienced a positive upswing, but a note of caution prevails for the second half of the year.</li>
<li>Major fine wine indices drifted in Q2, partly due to stronger sterling.</li>
<li>Fine wine demand remains solid, with wealth managers and financial advisors predicting it is set to increase.</li>
<li>Bordeaux enjoyed sustained interest in Q2, due to the release of the high-quality 2022 vintage.</li>
<li>The high release prices, however, led buyers to older vintages of comparable quality and the majority of the best-performing wines in Q2 were Bordeaux.</li>
<li>Marchesi Antinori took full ownership of Napa Valley’s iconic winery Stag’s Leap, while Joseph Drouhin expanded its Burgundy vineyard holdings.</li>
<li>New World releases will likely dominate the Q3 headlines.</li>
</ul>
Click below to download your free copy of our quarterly investment report.

Q2 2023 Fine Wine Report

Bordeaux 2022 is a great vintage that, despite its high quality, failed to reverse the waning sentiment for En Primeur. The excitement of the new was counteracted by the value on offer.
Although there was a significant increase in the number of visitors at the En Primeur tastings this spring, the campaign did not succeed in capitalising on this positive momentum.
Our latest report, Bordeaux 2022: Unfulfilled Potential, delves into the reasons why the campaign didn’t quite deliver on hopes and the event’s place within the industry in coming years.
<h2>Key findings:</h2>
<ul>
<li>Bordeaux 2022 is a high-quality vintage that has surpassed expectations, given the challenges of the growing season.</li>
<li>Neal Martin’s average 2022 in-barrel score was below 2020, 2019, and 2016, with most critics noting that it is a vintage to be selective.</li>
<li>The En Primeur tastings saw a significant increase in the number of visitors this spring, indicating continued interest in the region.</li>
<li>Some wines managed to offer value and were met with high demand upon release, including Château Cheval Blanc, Château Beychevelle, and Château Lafleur.</li>
<li>Average price increases between 15% and 25%, and as high as 55%, did not resonate well with the soft Bordeaux market.</li>
<li>Bordeaux 2022 vintage failed to reverse the declining sentiment for En Primeur due to high release prices in the context of older vintages offering better value.</li>
<li>Producers should evaluate the market dynamics to navigate the evolving fine wine market, and the role of En Primeur within it.</li>
</ul>
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En Primeur Report – Bordeaux 2022: Unfulfilled Potential

<ul>
<li>Our special report, entirely based on primary research, reveals wealth managers&#8217; and financial advisers’ attitudes toward fine wine.</li>
<li>Almost all (96%) UK wealth managers expect demand for fine wine to increase.</li>
<li>Fine wine is ahead of watches (86%) and luxury handbags (80%) in second and third place respectively.</li>
</ul>
UK wealth managers see demand for fine wine comfortably outstripping other passion assets, such as watches, luxury handbags, and art. This is one of the findings in our special UK report, Fine Wine: The Journey from Passion Asset to Mainstream Asset Class.
<h2>Fine wine – the most in-demand passion asset</h2>
The report, based on a study conducted among 50 UK-based wealth managers and financial advisers who only deal with high-net worth clients (£100K+), revealed that fine wine will attract most demand from investors over the coming year amongst all leading passion assets. 96% expect demand to increase, of which three out of five (60%) said that it will increase “significantly”.
This placed fine wine comfortably ahead of watches (86%) and luxury handbags (80%) in second and third place respectively. Other well-established passion assets such as art (68%) and classic cars (62%) placed much lower in sixth and tenth place.
<h2>Fine wine in investment portfolios</h2>
The report found that fine wine is already featuring prominently in many wealth managers’ client portfolios. UK wealth managers and advisers estimated that over 40% of their high-net-worth (“HNW”) client base invest in fine wine with an average portfolio allocation of around 10%.
Fine wine’s growing prevalence among HNW client portfolios provides compelling evidence, if any is needed, that it has graduated to a genuine alternative asset, a highly effective portfolio diversifier, operating alongside other popular alternatives such as hedge funds, real assets, and private capital as well as mainstream assets such as fixed income and equities.
In common with other alternative assets, fine wine tends to feature more prominently in larger portfolios belonging to more sophisticated investors where there is a greater premium on diversification. Almost all respondents (98%) said that clients investing in fine wine are mainly experienced investors, with 62% saying they were “very experienced”.
Please fill in the form below to download your complimentary copy of the report.

Special UK Report – Fine wine: the journey from passion asset to mainstream asset class

<ul>
<li>Our special report reveals how US wealth managers and financial advisers perceive fine wine as an investment. </li>
<li>Almost all (92%) US wealth managers expect demand for fine wine to increase.</li>
<li>Fine wine is ahead of jewelry (78%) and antique furniture (78%) in joint second. </li>
</ul>
In recent years, fine wine has grown in popularity among affluent and high-net worth individuals in the US, driven by a greater recognition of the role it can play in delivering stability, attractive returns, and diversification to investment portfolios.
To date, there has been limited research into how fine wine is perceived by the key gatekeepers to sophisticated private investors, namely wealth managers and financial advisors.
Our special US report, Fine Wine: The Journey from Passion Asset to Mainstream Asset Class, seeks to bridge this gap by drawing on independent primary research among 50 US-based wealth managers and financial advisors.
<h2>Fine wine demand to increase</h2>
Our findings revealed that fine wine will attract most demand from investors over the coming year amongst all leading passion assets, with almost all (92%) of the surveyed expecting demand to increase.
This placed fine wine comfortably ahead of jewelry (78%) and antique furniture (78%) in joint second. Other well-established passion assets such as classic cars (64%) and art (54%) placed much lower in sixth and ninth place.
<h2>Fine wine’s place in a portfolio</h2>
The report found that fine wine is already featuring prominently in many wealth managers’ client portfolios. US wealth managers and advisors estimated that almost half (45%) of their high-net-worth (“HNW”) client base invest in fine wine with an average portfolio allocation of around 13%.
Fine wine’s growing prevalence among HNW client portfolios provides compelling evidence, if any is needed, that it has graduated to a genuine alternative asset, a highly effective portfolio diversifier, operating alongside other popular alternatives such as hedge funds, real assets, and private capital as well as mainstream assets such as fixed income and equities.
The report further provides in-depth research on the most common reasons for US investors to consider fine wine, and catalysts for further growth.
Please fill in the form below to download your complimentary copy of the report.

Special US Report – Fine wine: the journey from passion asset to mainstream asset class

A version of this article by WineCap’s CEO Alexander Westgarth was first published in <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/06/05/what-investors-and-wealth-managers-need-to-know-about-wine-investing/">Forbes</a>.
<ul>
<li>Fine wine has been traded for millennia although its popularity as an investment is more recent. </li>
<li>The fine wine market&#8217;s stability compared to stocks make it an effective volatility smoother, preserving wealth during market downturns.</li>
<li>Investors should consider factors such as illiquidity risk, storage costs, and insurance coverage, while positioning wine as a complementary asset within a diversified portfolio.</li>
</ul>
The world of fine wine has long captivated investors with its timeless allure. Wine appreciation and collection is one of the oldest practices; the ancient Greeks, Egyptians, Phoenicians and Romans were all big traders of wine. Perhaps the first evidence of wine investment in the more traditional sense can be found in the writings of Thomas Jefferson, America’s third president. In 1787, he wrote that the 1786 vintage for top Bordeaux wines cost 1800 livres per tonneau compared to 2000 livres for the older 1783.
Today, the fine wine market is gaining popularity, not just among oenophiles; investors and wealth managers are looking to reap the benefits of this diverse asset class. New participants are eager to ensure they avoid potential pitfalls and make informed investment decisions. This article provides some of the key considerations for successful wine investing, showcasing the market&#8217;s potential at a glance.
<h2>Wine as a hedging asset</h2>
When constructing a well-rounded investment portfolio, it is crucial to consider the inclusion of fine wine as a hedging asset. Fine wine has a historical track record of retaining and increasing its value, even during periods of economic recession or financial uncertainty. Recent years are a case in point. While the world grappled with pandemics, wars and inflation, fine wine enjoyed an incline. Over the last half-decade, the average bottle of fine wine has increased in value by a notable 45%, according to the Liv-ex 1000 index.
Certain wines did exceptionally well over the pandemic. The standout players were Burgundy, Champagne and Bordeaux. At the start, fine bottles of Burgundy were selling for just under £200 (May 2020). But within two and a half years, average prices soared to over £325 (September 2022)—a return of 62%.
There are several reasons why wine tends to buffer against market shocks. Firstly, as a physical asset, it is less sensitive to inflation – just like property, gold or excellent art. Secondly, the market is private. Buyers are often high net worth or ultra-high net worth individuals, so they are wealthy and passionate. Thirdly, it is a rare and depleting asset.
The scarcity factor of fine wine makes it increasingly valuable over time. As purveyors open bottles, the demand outweighs supply and prices can soar. For instance, Domaine Leroy&#8217;s Nuits-Saint-Georges&#8217; Aux Lavieres has experienced a remarkable 353% increase in value over the past five years, driven by its scarcity.
<h2>Wine can smooth out volatility</h2>
An excellent wine must be enjoyed slowly. In the same way, the wine market tends to move at a more gentle pace too. While stocks can sky-rocket or plummet in weeks, wine movements often take months. This can add much-needed stability to investment portfolios.
Wealth managers have harnessed the volatility-smoothing properties of wine to offset the erratic performance of other assets. Even a modest allocation of up to 10% can significantly reduce overall portfolio volatility and act as a valuable tool during market downturns. When inflation rockets, it can also help to preserve some of the wealth eroded through bonds and cash-like instruments.
<h2>Liquidity, storage and insurance considerations</h2>
Potential investors should be mindful of the illiquidity risk associated with wine investments. While the wine itself is a liquid asset, the investment tends to lack immediate liquidity. Investors should carefully assess their liquidity needs before embarking on a wine investment journey. Those who might need quick access to cash may want to include some cash-like investments like T-Bills or Bank CDs in their portfolio.
A buy-and-hold strategy typically yields the best results in wine investment. Selling too early can result in missed opportunities for substantial profits, especially when considering the maturity of the vintage. While digital platforms offer relatively quicker selling options, physical auction routes may take longer but can still deliver favorable outcomes.
Investors must also factor in the costs associated with wine investments. Unlike investing in public markets, fine wine incurs additional expenses such as secure storage and temperature control. Investors may also consider insurance, particularly when transporting wines between locations. Although these costs are generally affordable, it is advisable to research storage options, seek reviews, and negotiate insurance coverage within annual fees.
In the United Kingdom, fine wine investments often benefit from exemptions from capital gains tax. This favorable tax treatment can offset storage costs multiple times over, further enhancing the investment&#8217;s attractiveness.
<h2>Investing soberly</h2>
While the potential for substantial returns in fine wine investment is evident, it is crucial to navigate the market with prudence and awareness of potential pitfalls. Investors should maintain sufficient liquidity in their portfolios to handle unforeseen emergencies and consider the long-term costs associated with wine investments.
The key to successful wine investing lies in positioning wine as a hedging asset and volatility smoother within a broader array of assets. Although an exceptional bottle of wine holds its own allure, it should not overshadow the rest of the portfolio. Wine should be viewed as a stable and valuable component, working harmoniously with other investments to help investors achieve their long-term financial goals.
With careful consideration of market dynamics, wine&#8217;s inherent hedging properties, and a prudent approach to investment, investors can embrace the timeless elegance of fine wine while capitalising on its investment potential.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Navigating the fine wine market: insights for savvy investors

<ul>
<li>Rising production costs and inflationary pressures in Champagne have raised concerns around its accessibility and its appeal to consumers.</li>
<li>Higher interest rates pose challenges for financing grape supplies, potentially eroding profit margins for smaller Champagne producers.</li>
<li>Champagne’s investment market has also been undergoing a similar shift, which has diminished its relative affordability compared to other fine wine regions.</li>
</ul>
Champagne has experienced a period of remarkable success, with a new record turnover set for the region in 2022, <a href="https://www.thedrinksbusiness.com/2023/06/does-champagne-risk-becoming-too-expensive/">The Drinks Business</a> highlighted in an article this week. However, leading figures in the region have noted that inflationary pressures and rising production costs could potentially make Champagne too expensive. This is a particular concern at the lower end of the market where fixed costs make up a larger proportion of the value of the wine and the need to keep prices affordable is more pronounced. But prices have come under pressure in the secondary market too, which has shifted its dynamics.
<h2>Champagne’s rising costs spark concerns among smaller producers</h2>
The escalating prices of grapes, along with increasing costs of labour, energy, packaging materials, and glass, have placed significant financial pressures on some Champagne houses. According to the article, the price of grapes from the 2022 harvest rose by as much as 10% compared to the much smaller 2021 vintage.
Rising interest rates, which were sitting below 1% two years ago and have now reached 3% and higher, have added extra pressure on financing grape supplies, potentially eroding profit margins of smaller producers. Meanwhile, various packaging materials, including paper, foils, cases, and glass, are up by around 40%.
The rising production costs may lead to further price increases for Champagne. This situation raises concerns around Champagne&#8217;s accessibility and its appeal to consumers. Some producers fear that higher prices could deter customers and potentially drive them towards alternative sparkling wines.
<h2>The shifting dynamics of Champagne’s investment market </h2>
The dynamics of Champagne’s secondary market have also been undergoing a clear shift. Previously, everything seemed to work in Champagne&#8217;s favour: abundant stock, strong distribution, consistent demand, and relative value compared to other fine wines.
Speculators have taken advantage of Champagne&#8217;s strengths, fuelled by a string of excellent vintages that increased demand. This has altered the traditional rules of the Champagne market, as speculators often hold onto their stock without consuming it, resulting in potential oversupply. The sustainability of rising prices in the face of a potential stock overhang can present a challenge.
Meanwhile, the rising price of Champagne has diminished its relative price advantage compared to other fine wine regions. Previously considered an affordable entry point into the world of fine wine, Champagne&#8217;s average prices now rival those of Bordeaux. For instance, the average case price of <a href="https://winecap.com/wine-track/france/champagne/na/krug/vintage-brut">Krug Vintage Brut</a> (£5,001) is higher than that of the First Growth <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-haut-brion/haut-brion">Château Haut-Brion</a> (£4,802).
<img loading="lazy" decoding="async" class="alignnone wp-image-1544" src="https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-375x237.png" alt="Champagne vs Bordeaux" width="750" height="474" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-2048x1294.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/06/Champagne-vs-Bdx-1980x1251.png 1980w" sizes="(max-width: 750px) 100vw, 750px" />
*Over the last five years, Champagne prices are up 76.8%, compared to 15.3% for Bordeaux. Champagne experienced stellar price performance between mid-2021 and the end of last year. Year-to-date, its index is down 9.1%.
Some producers have also displayed an ambition to raise prices. Notable brands, such as Philipponnat&#8217;s Clos des Goisses and Lanson&#8217;s Le Clos Lanson, have joined La Place de Bordeaux, signaling their intent to push their brands. Last year, <a href="https://winecap.com/news/champagne-jacquesson-purchased-by-pinault-family">François Pinault&#8217;s Artemis Group</a> acquired a majority stake in Champagne Jacquesson. While this highlighted Champagne’s investment potential, it also indicated a departure from offering wines at entry-level prices.
All of this presents a complex landscape for Champagne&#8217;s future pricing and market positioning; particularly, for smaller more affordable producers, less able to spreads costs over multiple products and absorb the rising costs. Is the era of affordable Champagne over?
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Champagne’s financial bubbles: rising costs spark concerns over affordability

<ul>
<li>Both bonds and fine wine can help to mitigate short-term risk in a portfolio.</li>
<li>After ten years the average bond delivers a 15% return, while fine wine – 78%.</li>
<li>Fine wine is an inflation-resistant asset, unlike bonds. 
</li>
<li>Bonds are generally much more liquid than fine wine.</li>
</ul>
Bonds are one of the most popular ways to invest. For decades, investment managers would opt for a strategy known as “60/40”, where 60% of the portfolio was allocated to equity and 40% to debt instruments. The idea was that the riskier equity (stocks and shares) would shield against inflation while helping to generate returns. By contrast, the more stable debt instruments (bonds and credit) would ground the portfolio and prevent it from plummeting during market downturns.
However, a lot has changed since then. Today, many experts comment that the 60/40 rule no longer applies. Instead, investors need to diversify much more to achieve more market stability. And they need to go further afield – <a href="https://winecap.com/learn/7-under-used-alternative-investments">into alternative assets</a> – to find true inflation resistance.
In this article, we’ll compare the risk, value drivers, return, liquidity, and inflation characteristics between bonds and fine wine.
<h2>Both wine and bonds can mitigate short-term risk</h2>
Bonds come with many different risk levels. Some borrowers – like fledgling start-ups – are extremely likely to default. While there are others – like the governments of developed nations or blue-chip companies – that are almost definitely going to meet the repayments.
Occasionally investment managers will opt for extremely risky debt – known as a High Yield Bond strategy. But generally, most will allocate a greater portion of the portfolio to low-risk bonds, which tend to be rated AAA or Aaa by specialist agencies. This is usually to anchor the portfolio and help bring in stable fixed income.
Like bonds, fine wine is also <a href="https://winecap.com/learn/five-low-risk-assets-to-hedge-against-inflation">generally a low-risk investment</a>. Because the value is intrinsic, it is unlikely to plummet overnight. After all, fine wine will always be valuable. No matter what’s going on in the stock market, somebody will almost always want to buy it.
Investment managers will often add a small allocation to fine wine to help preserve wealth and mitigate risk. We have noticed that the wealthier the client, the higher the proportion tends to be. So, ultra-high net worth (UHNW) individuals and family offices generally have more fine wine in their portfolios.
<h2>The sources of value are different</h2>
While AAA bonds and fine wine may have similar risk levels, their revenue sources couldn’t be more different.
Investors make money from debt instruments like bonds by collecting the repayments from the initial sum, plus interest (the extra interest is known as “coupons”). With bonds, investors get regular revenue, which is why the asset falls under the category of “fixed income”. The repayments and coupons are usually paid quarterly.
By contrast, fine wine investors generally need to wait until they have sold the cask or bottle before they can access any returns. However, the returns are usually much more lucrative than bonds.
<h2>Wine has a stronger return profile</h2>
The <a href="https://www.bankrate.com/investing/good-return-on-investment/#key-roi-stats">average annual return</a> of a bond is 1.6%. Usually, bonds will last for longer than a year though. Short-term bonds are around three years, mid-term is about five years and long-term is anything over a decade. Over ten years, investors gain an average of <a href="https://investor.vanguard.com/investment-products/mutual-funds/profile/vbtlx#performance-fees">15% returns</a>. This means that if you invested £1,000, you could expect to get around £1,150 back.
One of the useful things about a bond is that investors should be able to clearly know how much they will get in advance. This is because the repayment terms and interest are already agreed upon, it does not depend on the ebbs and flows of market sentiment.
Like bonds, fine wine can also take some time to realise its return potential. But, on average, it’s much more profitable for investors than bonds. Figures from the Liv-ex 1000 index show that the average bottle of fine wine already brings returns of <a href="https://app.liv-ex.com/#/analysis-tool/charting-tool">23% after two years</a>. After five years, that increases to <a href="https://app.liv-ex.com/#/analysis-tool/charting-tool">34%</a>, and after ten to 78%. So, if you had invested £1,000, you could expect to get back £1,780%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1539" src="https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-375x237.png" alt="Liv-ex Fine Wine 1000 ten years" width="750" height="474" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-2048x1294.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/06/Index_ten-years-1980x1251.png 1980w" sizes="(max-width: 750px) 100vw, 750px" />
You can follow how specific bottles have performed over the past decade <a href="https://winecap.com/wine-track">with Wine Track</a>.
<h2>Bonds are more liquid than fine wine</h2>
There are two main ways to invest in bonds. You can buy them on the primary market and lend money directly to borrowers, or you can trade bonds on the secondary market. In the secondary market, the new buyer will then own the debt and pick up the repayments. This makes bonds quite liquid, meaning they are fairly easy to sell and turn into cash if you suddenly need the money. For publicly traded loans (rather than private debt) you should usually be able to sell a bond and expect the money in your bank account within a week.
Fine wine investors also have a primary and secondary market, but the process of trading is not usually so quick. For the best results, investors should wait until the wine matures before selling. But this can mean that the money is locked-up for months or years at a time. Some vintages, for example, can take upwards of twenty years to peak. If you sell early, you could miss out on valuable returns.
Before investing in wine, always consider your liquidity needs. It can be helpful to add-in some cash or cash-like investments into your portfolio in case you need to access funds quickly.
<h2>Fine wine is more inflation-resistant than bonds</h2>
Inflation occurs when the value of money decreases. Usually, this is because a central bank (like the Bank of England) prints more money to help the economy overcome a crisis, known as Quantitative Easing. While this measure may help to prevent a recession, sooner or later it usually needs to be reversed. When the economy is red hot, central banks normally need to hike up the interest rates to cool things down again. This can be painful for debt investors, and especially those holding long-term bonds.
Imagine that in 2019, you bought a ten-year bond to lend £1,000. At this time, the bank rate was set at <a href="https://www.bankofengland.co.uk/monetary-policy-summary-and-minutes/2019/may-2019#:~:text=At%20its%20meeting%20ending%20on,reserves%2C%20at%20%C2%A310%20billion.">0.75%</a>. Today (in 2023), you would still have six years left on your bond, but the bank rate has soared to <a href="https://www.bankofengland.co.uk/monetary-policy/the-interest-rate-bank-rate">4.5%</a>. The borrower will still be paying you the rate that was agreed in 2019. You could be paying more for your own mortgage or credit card than you’re getting back from your investment.
What’s more, the initial sum is becoming worth less by the day as <a href="https://tradingeconomics.com/united-kingdom/inflation-cpi">high inflation</a> of 8.7% grips the economy. If the inflation continues, by the time the bond is repaid, that £1,000 is the real value equivalent of just <a href="https://www.in2013dollars.com/uk/inflation/2019?endYear=2029&amp;amount=1000&amp;future_pct=-0.087">£740.55 today</a>.
The downside of investing in bonds is that they don’t really protect you from inflation, especially over the long term.
Fine wine, on the other hand, <a href="https://winecap.com/learn/is-fine-wine-inflation-proof">is a good example of an inflation-resistant asset</a>. Over the years, the value of precious bottles tends to keep up or even outpace Quantitative Easing.
There are many reasons for this. First and foremost, it is a physical asset like property and art, which acts like a wealth store. It is rare and depleting. Furthermore, the passionate and global market usually keeps prices at a healthy level.
<h2>The best approach is probably a mix of investments</h2>
As Nobel-prize laureate Harry Markowitz famously quipped, “Diversification is the only free lunch in finance”. This philosophy marks the cornerstone of modern portfolio theory. The idea is that you should invest in as many different revenue sources as possible to mitigate against risk. This means that for most portfolios there should be a blend of equity, debt (like bonds), alternative investments (like fine wine), real estate and some cash. Usually, the allocation to cash is about 5%.
Both bonds and fine wine have different investment characteristics. The trick is to use them in the most beneficial way to investors. For example, if you’re looking to grow your wealth over the long-term, fine wine is probably a better option. However, if you’re looking to generate regular income, investing in bonds could be a better bet.
There are interesting examples of bonds and fine wine working together within retirement portfolios. <a href="https://winecap.com/learn/pension-fund-managers-are-turning-to-fine-wine">Fine wine is increasingly used as a growth generator</a> to boost the investor’s wealth at the start of their pension journey. Meanwhile, bonds normally provide stable and regular income after the investor retires.
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WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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Bonds vs fine wine: what should you invest in?

<ul>
<li>Back vintages can often offer better investment prospects than new releases.</li>
<li>Looking at Bordeaux 2022 so far, the wines have been offered at a 16% premium on last year on average; some as high as 40%.</li>
<li>Prices for physical Bordeaux have declined since the start of the campaign, making older vintages even more affordable.</li>
</ul>
With the annual En Primeur campaign in full swing, many consider the investment opportunities in Bordeaux futures. What has become clearer in recent years, however, is that back vintages can often offer better prospects than the new releases.
For many châteaux, En Primeur is no longer the cheapest time to buy a bottle, with older vintages available in the market for less. This goes against the original premise of buying futures, which was an opportunity to acquire the wines at the lowest price possible.
<h2>Price and score inflation</h2>
Although Bordeaux has experienced improvements in quality, a trend evident in critic scores inflation, the price increases have been even more noticeable.
Looking at Bordeaux 2022 so far, the wines have been offered at a 15.6% premium on last year on average; some as high as 40%. For instance, <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-rauzan-segla/rauzan-segla">Château Rauzan Segla</a> was released with a 40.3% increase and <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-beau-sejour-becot/beau-sejour-becot">Château Beau-Séjour Bécot</a> – up 37.2%.
Château Climens, which did not produce wine in 2017, 2018 and 2021 due to weather challenges, launched its 2022 with a 139.4% increase on the 2016. As a result, back vintages like 2007, 2010 and 2011 enjoyed heightened demand, which in turn pushed prices. <a href="https://winecap.com/wine-track/france/bordeaux/barsac/chateau-climens/climens">Château Climens</a> has become one of the best-performing Bordeaux brands so far this year, according to Wine Track, rising 39%.
<h2>Prices for physical Bordeaux decline</h2>
Not all releases have enhanced a brand’s value. Since the start of the campaign, prices for physically available Bordeaux wines have declined 1.3% on average, according to the Liv-ex Bordeaux 500 index.
<img loading="lazy" decoding="async" class="alignnone wp-image-1514" src="https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-375x237.png" width="750" height="474" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-2048x1294.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/06/bdx500-1980x1251.png 1980w" sizes="(max-width: 750px) 100vw, 750px" />
This is making back vintages look especially good value, in the context of rising En Primeur prices.
Take for instance one of the most recent releases, Château Lynch-Bages 2022, which was offered at £1,280 per 12&#215;75, up 20.8% on last year. The 2022 surpasses the price of any vintage younger than 2010. The 2019 and 2016 look particularly good value, with higher critic scores and lower prices.
<img loading="lazy" decoding="async" class="alignnone wp-image-1516" src="https://wp.winecap.com/wp-content/uploads/2023/06/Lynch-Bages-2022-375x196.jpg" alt="Lynch-Bages " width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Lynch-Bages-2022-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Lynch-Bages-2022-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Lynch-Bages-2022.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
Buyers will find opportunities in old vintage Bordeaux, such as 1995 and 1996, as well as the most recent years – 2021, 2020, 2019 and 2018. The recent trilogy of greats (2018-2020) offers plenty of options, with comparable quality to the new releases and lower prices.
For instance, the average Neal Martin score for the 2022 vintage is 94.8; in comparison, his 2019 is 95.2 and 2020 – 95.1.
<h2>The campaign’s successes</h2>
As discussed in a <a href="https://winecap.com/news/en-primeur-round-up-the-best-bordeaux-2022-releases-so-far">recent article</a>, there have been some successful En Primeur releases such as Cheval Blanc, Beychevelle, and most recently, Les Carmes Haut-Brion. These wines were offered higher than last year but still represented an attractive point of entry into the brand, and immediately enjoyed demand.
<img loading="lazy" decoding="async" class="alignnone wp-image-1518" src="https://wp.winecap.com/wp-content/uploads/2023/06/EP-Socials-LinkedInAll-6-375x196.jpg" alt="Carmes Haut-Brion" width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/EP-Socials-LinkedInAll-6-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/06/EP-Socials-LinkedInAll-6-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/06/EP-Socials-LinkedInAll-6.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
Les Carmes Haut-Brion has become a collector’s favourite as quality has improved. Until 2010, 93-points was the highest score the wine had received. The newest release achieved 98-100 points from Antonio Galloni (<a href="https://vinous.com/">Vinous</a>) and 99-100 from Yohan Castaing (<a href="https://www.robertparker.com/">Wine Advocate</a>). Neal Martin also credited it ‘as the best Carmes the new owners have overseen’. Its average score was higher than the more expensive Ausone, Haut-Brion, Lafite Rothschild, Margaux, Mission Haut-Brion and Le Pin.
At a quarter of the price of a First Growth, and half the price of wines like Léoville-Las Cases and Palmer, the wine has demonstrated considerable potential for continued appreciation. This has been reflected in the performance of its index, which has <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-les-carmes-haut-brion/carmes-haut-brion">risen 41% over the last five years</a>, making it one of the best-performing Bordeaux properties.
The successful 2022 releases have taken into consideration existing demand for the brand, vintage quality and, most importantly, offered value compared to back vintages.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Investment opportunities in back vintage Bordeaux

A version of this article by WineCap’s CEO Alexander Westgarth was first published in <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/04/05/the-pairing-of-old-wine-and-new-markets-trends-in-the-wine-industry/?sh=324dd99b29ee">Forbes</a>.
<ul>
<li>The wine investment landscape has evolved significantly, with younger, international buyers increasingly shaping the market.</li>
<li>Growing global demand has made the market more liquid, transparent and efficient. </li>
<li>New investors are exploring assets beyond traditional stocks and bonds such as wine and other collectibles.</li>
</ul>
The image of the traditional wine investor is changing. Gone are the days of gentlemen with monocles and fur coats. Today, the reality of who purchases fine wine may surprise you.
In this article, we explore the changing demographics of wine buyers and highlight modern investment trends for wealth managers looking to incorporate wine into their portfolios.
<h2>Shifting demographics: younger generations enter the market</h2>
The average wine buyer has become considerably younger in recent years. Jamie Ritchie, Head of Wine at Sotheby’s Auction House, <a href="https://areni.global/debt-death-divorce-fine-wine-and-the-auction-world-in-conversation-with-jamie-ritchie/">said</a> that in the 1990s the average wine buyer was 65. However, according to a <a href="https://www.sothebys.com/en/docs/pdf/jk-22907254-feb-2022-wine-market-report-2021-final.pdf">2021 report</a>, only 7% of wine buyers are now over 60, while 37% are under 40. Nearly 270 millennials and Gen Zs placed the winning bid for Sotheby’s finest wines and spirits.
This shift is particularly relevant for wealth managers, as fine wine aligns well with younger investors who have long-term investment horizons. Most fine wines have potential for ageing – a good Bordeaux, for instance, can be cellared for 50+ years. This can add stability to an investment portfolio. Over the past two decades, the average price of <a href="https://app.liv-ex.com/#/analysis-tool/charting-tool">fine wine has risen 380%</a>, suggesting a potential for continued growth as demand increases and supply diminishes.
<h2>The liquidity challenges of wine investment</h2>
While investing in fine wine offers long-term benefits, one should not ignore the liquidity aspect. Younger investors may require quicker access to funds, which poses a challenge as wine can take time to trade. Selling wine investments prematurely may result in missing out on substantial profits. Wealth managers should, therefore, consider diversifying portfolios by combining fine wine with other liquid assets, such as cash-like securities, blue-chip stocks, and bonds. Striking the right balance between illiquid and liquid investments is key to maximising returns.
<h2>Global appeal</h2>
The international appeal of wine has grown significantly over the past two decades. According to Sotheby’s Wine &amp; Spirits Market Report 2021 referenced earlier, North American bidders have been drawn to the market to make up nearly half of Sotheby’s new buyers.
This could be partly attributed to the power of currency. On the first day of 2021, 1 pound was worth $1.37. But by mid-December, it had zigzagged down to $1.32. As the green bills swelled in purchasing power, fine wine (usually denominated in sterling) grew increasingly tempting to U.S. investors. Today sterling continues to weaken against the dollar. As of June 7th 2023, 1 pound costs $1.24.
Additionally, Asian buyers now make up 52% of wine sales at Sotheby’s, with American investors representing 18%, and Europe (primarily split between the UK and France) accounting for the remaining 30%.
Growing global demand for wine offers some serious advantages for existing investors. As well as bringing in more potential buyers, the value of fine wine tends to rise above regional shocks. As the market base grows, the market becomes more liquid and efficient, improving price transparency.
<h2>A thirst for inflation-hedging and nostalgia</h2>
Historically, fine wine has been difficult to access. Investors needed to be deeply entrenched in elusive private markets. Owning an investment portfolio at all was generally reserved for the wealthy few.
But today, spurred by a boost in financial literacy and digital investment platforms, new groups are entering. Alongside wine, today’s digital investors are adding cultural timepieces like iconic shoes, sweaters, watches and even Legos to their portfolios. This could be partly due to nostalgia but it could also be the result of an astute investment strategy.
Historical data shows impressive returns for collectibles, with sneakers generating over 2,000% returns and Swatch timepieces delivering over 7,000%. One in-depth study found that from 1987 to 2015, Lego collectibles delivered returns of at least 11%.
Considering the anticipated high interest rates, low growth, and volatility of 2023, physical assets can serve as a hedge against inflation. While certain collectibles may be speculative, wine and art have demonstrated a history of hedging against economic downturns.
<h2>Leveraging online investment platforms and adapting to investor preferences</h2>
Wealth managers can leverage online investment platforms to access performance data, bid-ask spreads, and forecasts. They can also purchase wine directly and handle everything from storage to auctions digitally.
As the investor landscape changes, wealth managers should explore assets beyond traditional stocks and bonds. Incorporating alternative investments, such as wine, can help diversify and enhance portfolio performance. Furthermore, incorporating <a href="https://corpgov.law.harvard.edu/2017/04/25/the-importance-of-nonfinancial-performance-to-investors/">passion assets that resonate with younger investors</a>, such as sustainability-focused investments and items reflecting their values, can strengthen client relationships and attract the next generation of investors.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The pairing of old wine and new markets: demographic shifts and emerging trends

<ul>
<li style="font-weight: 400;" aria-level="1">Joseph Drouhin has acquired two properties, Château de Chasselas in Saint-Véran and Rapet in Saint-Romain.</li>
<li style="font-weight: 400;" aria-level="1">The expansion comes as both producers and buyers seek to find stock and value in an increasingly competitive market for Burgundy.</li>
<li style="font-weight: 400;" aria-level="1">Drouhin has been a brand on the move, with some of its wines rising near 40% in value in the last year.</li>
</ul>
<h2>Joseph Drouhin expands its vineyard holdings </h2>
Rising demand for Burgundy has fueled winery purchases and new investments. One of the most prominent producers, Maison Joseph Drouhin, <a href="https://www.winespectator.com/articles/drouhin-expands-its-burgundy-vineyard-holdings">has expanded its vineyard holdings</a> with the recent acquisition of Château de Chasselas in Saint-Véran and Rapet in Saint-Romain.
Frédéric Drouhin, president of the Maison, explained that this decision was driven by increased competition and challenges in acquiring vineyards and purchasing grapes. The purchase focuses on high-quality yet more affordable areas in Burgundy – outside the main Côte d’Or villages, as both producers and buyers seek to find value in a region that has experienced significant price increases in recent years.
Just in the last five years, Burgundy fine wine prices have risen 75.7% – more than seven times the prices of the Bordeaux First Growths.
<img loading="lazy" decoding="async" class="alignnone wp-image-1502" src="https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-375x232.png" alt="Burgundy vs Bordeaux prices" width="750" height="465" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-375x232.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-768x476.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-1536x952.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-2048x1269.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-1200x744.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/06/Burgundy-vs-LX50-1980x1227.png 1980w" sizes="(max-width: 750px) 100vw, 750px" />
The insatiable demand and investment interest in the region have also <a href="https://www.decanter.com/wine-news/burgundy-grand-cru-vineyard-prices-double-10-years-398125/">impacted the cost of land</a>, creating something of a vicious circle. 
The price of the latest Drouhin purchase was not disclosed.
<h2>The estates</h2>
Château de Chasselas encompasses 17.3 acres and is already a major supplier of Drouhin&#8217;s Saint-Véran wine. The property also includes small parcels in Chasselas and Beaujolais. The Rapet estate spans 19.8 acres and includes both Pinot Noir and Chardonnay vineyards in Saint-Romain, as well as small parcels in Auxey-Duresses, Pommard, and Meursault.
The debut vintage of Drouhin&#8217;s Saint-Romain wine is the 2022, while the first bottling of Saint-Véran Château de Chasselas will be the 2023 vintage, which will be released in 2024. All the newly acquired vineyards are being transitioned to organic farming practices.
With these acquisitions, Maison Joseph Drouhin owns close to 250 acres of vineyards, spanning from Chablis to Mâcon and encompassing 60 appellations. Their portfolio includes 14 Grands Crus and 20 Premier Crus. 
<h2>Drouhin’s place in Burgundy’s secondary market</h2>
Joseph Drouhin has been a Burgundy brand on the move. The brand jumped 142 places in the <a href="https://www.liv-ex.com/2022/11/liv-ex-power-100-2022-burgundy/">2022 Power 100 rankings</a>, thanks to its price performance. 
Four wines from the estate also ranked in the first tier of the <a href="https://www.liv-ex.com/2021/08/liv-ex-classification-2021/">2021 Liv-ex Classification</a>, which ranks the wines of the world solely by price: Montrachet Grand Cru Marquis de Laguiche, Musigny Grand Cru, Chambertin-Clos de Bèze Grand Cru, and Chambolle-Musigny Premier Cru Les Amoureuses.
<h2>The best performing Drouhin wines</h2>
In the last year alone, the best performing Joseph Drouhin wines have risen between 13% and 39%, outperforming the Burgundy 150 index. 
The biggest riser has been their <a href="https://winecap.com/wine-track/france/burgundy/beaune/joseph-drouhin/beaune-clos-mouches-rouge">Beaune Premier Cru Le Clos des Mouches Rouge</a>, which has an average price of £1,403 per case.
You can now explore the historic performance of these wines on <a href="https://winecap.com/wine-track">Wine Track</a>. Our tool provides a clear overview of a fine wine’s track record, including critic scores, average price and investment returns. 
<img loading="lazy" decoding="async" class="alignnone wp-image-1501" src="https://wp.winecap.com/wp-content/uploads/2023/06/Best-performers-375x349.png" width="750" height="698" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Best-performers-375x349.png 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Best-performers-768x715.png 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Best-performers-1200x1118.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/06/Best-performers.png 1223w" sizes="(max-width: 750px) 100vw, 750px" />
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;

Joseph Drouhin expands vineyard holdings to meet rising Burgundy demand

<ul>
<li>Technology has revolutionised various aspects of the wine trade, from ensuring provenance to streamlining valuations.</li>
<li>From blockchain to AI and data analytics, these advancements can improve transparency and efficiency.</li>
<li>Wine investment tools like Wine Track help investors spot opportunities and discover relative value. </li>
</ul>
In the rapidly evolving landscape of fine wine investment, technology has emerged as a transformative force, revolutionising various aspects of the industry. From verifying provenance to streamlining valuation processes, advancements such as blockchain and artificial intelligence (AI) have played a crucial role.
This article explores the impact of technology on fine wine investment, delving into blockchain-based provenance verification, AI-driven wine valuation, and digital marketplaces that are shaping the industry&#8217;s future.
<h2>Blockchain-based provenance verification</h2>
One of the significant challenges in the fine wine market is verifying the authenticity and provenance of bottles. Counterfeit wines can undermine investor confidence and erode market trust.
However, blockchain technology has emerged as a powerful tool to address this issue. By creating a decentralised and immutable ledger, blockchain allows for the transparent recording of a wine&#8217;s journey from vineyard to consumer.
Each transaction and transfer of ownership can be documented, ensuring a reliable and verifiable record of a wine&#8217;s provenance. This technology provides investors with greater confidence in the authenticity and quality of their investments.
However, applying blockchain to tangible assets like wine has some complexities. Unlike virtual transactions, the wine trade involves physical goods with unique characteristics and specific storage requirements. Bottles can be removed from cases, stored improperly, and tax status may vary, posing challenges for a fully distributed ledger system. Despite the existing challenges, blockchain holds significant potential in creating a more secure and trustworthy wine trade ecosystem.
<h2>AI-driven wine valuation</h2>
Accurate and reliable wine valuation is essential for investors seeking to make informed decisions. AI-powered tools and algorithms are transforming the wine valuation process, leveraging vast amounts of data to generate precise and timely assessments.
By analyzing factors such as vintage, producer, critic ratings, market trends, and historical sales data, AI algorithms can provide sophisticated valuation models. These models offer investors insights into the potential appreciation or depreciation of specific wines, enabling more informed investment strategies.
<h2>Digital marketplaces</h2>
Digital marketplaces have disrupted traditional fine wine trading by providing a platform that connects buyers and sellers in a transparent and efficient manner. These platforms leverage technology to facilitate secure transactions, streamline logistics, and expand the reach of the market.
Online marketplaces allow investors to access a global network of fine wines, enabling diversification and providing a more extensive selection to choose from. Additionally, these platforms often offer tools for researching wines, comparing prices, and tracking market trends, empowering investors with valuable information to make informed investment decisions.
<h2>Fine wine investment tools</h2>
One free tool that helps investors is <a href="https://winecap.com/wine-track/">Wine Track</a>. Wine Track is a comprehensive fine wine index that enables investors to identify investment grade wines, spot trends and wine investment opportunities.
The tool uses daily wine price data from multiple sources, tracking over 75,000 investment grade wines. It indexes the prices of multiple vintages of a given wine, and aggregates critics’ scores, to provide a clear overview of a wine’s investment track record.
The tool also highlights the best and worst performing wines over different time periods, and includes a ‘price per point’, which is a clear indicator of relative value to help investing in wine.
<img loading="lazy" decoding="async" class="alignnone wp-image-1496" src="https://wp.winecap.com/wp-content/uploads/2023/06/Academy-news-and-insight-page-image-375x153.jpg" alt="Wine Track" width="800" height="327" srcset="https://wp.winecap.com/wp-content/uploads/2023/06/Academy-news-and-insight-page-image-375x153.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/06/Academy-news-and-insight-page-image-768x314.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/06/Academy-news-and-insight-page-image.jpg 856w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>Data analytics for market insights</h2>
Data analytics has become crucial in fine wine investment, offering investors valuable insights into market trends and patterns. By analyzing vast amounts of data from multiple sources, including auction results, critic ratings, and global demand patterns, investors can gain a deeper understanding of market dynamics.
Data-driven insights enable investors to identify emerging investment opportunities, track the performance of specific wines or regions, and make informed decisions based on historical market trends.
Technology has significantly influenced the landscape of fine wine investment, providing investors with enhanced transparency, efficiency, and analytical capabilities. Digital traceability ensures wines reach the right hands, while AI-driven wine valuation leverages data analytics to generate accurate and timely assessments, guiding investment decisions. As the wine trade continues to adapt the latest technology, investors will be able to navigate the market with greater efficiency and confidence.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

The role of technology in fine wine investment: From blockchain to AI

<ul>
<li>Moët Hennessy has achieved new organic certifications for three estates, highlighting their commitment to sustainability and soil health initiatives.</li>
<li>The wine industry has seen a rise in organic wineries as more producers adopt sustainable practices to promote soil health, biodiversity, and natural pest control.</li>
<li>This is not only beneficial for the environment but presents an opportunity for ESG investors.</li>
</ul>
<h2>Moët Hennessy achieves new organic certifications</h2>
Moët Hennessy has achieved new organic certifications for three of its estates as part of its sustainability initiative called &#8216;Living Soils Living Together’, the <a href="https://www.thedrinksbusiness.com/2023/05/moet-hennessy-awarded-new-organic-certification/">drinks business</a> reported.
One of the accreditations was granted to Château Galoupet in Provence, recognising its commitment to soil regeneration and soil health initiatives.
Additionally, two wine estates in Argentina, Chandon Argentina and Terrazas de Los Andes, were awarded the Regenerative Organic Certified (ROC) status by the non-profit organization Regenerative Organic Alliance.
In line with the program, Moët Hennessy had previously committed to <a href="https://winecap.com/news/champagne-producers-against-zero-herbicide-u-turn">ceasing the use of herbicides</a> in its Champagne vineyards.
<h2>The rise of organic wineries</h2>
Moët Hennessy is not alone in its pursuit of a greener future. There has been a noticeable increase in the number of wineries adopting organic practices in recent years. The organic wine movement has gained significant momentum as consumers and wine investors have become more conscious about sustainable and environmentally friendly products.
Wineries are transitioning to organic farming methods to reduce their use of synthetic chemicals, pesticides, and herbicides in grape cultivation. Such practices focus on promoting soil health, biodiversity, and natural pest control, resulting in healthier vineyards and potentially higher quality grapes.
<h2>Renowned organic producers</h2>
Some of the most renowned organic producers include Burgundy’s <a href="https://winecap.com/wine-track/france/burgundy/batard-montrachet/domaine-leflaive/batard-montrachet">Domaine Leflaive</a>, and the Bordeaux Fifth Growth estate, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-pontet-canet/pontet-canet">Château Pontet-Canet</a>.
While not officially certified, Burgundy’s <a href="https://winecap.com/wine-track/france/burgundy/echezeaux/domaine-de-la-romanee-conti/echezeaux">Domaine de la Romanée-Conti</a> also adheres to organic and biodynamic principles in its vineyard management and produces some of the most sought-after wines in the world.
<h2>A sustainable investment asset</h2>
The increasing adoption of organic and sustainable practices by wineries is not only beneficial for the environment but also presents an opportunity for wine investors. The influence of Environmental, Social and Governance (ESG) factors over investment portfolios has grown dramatically in recent years.
Indeed, <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">fine wine can be considered an ESG investment</a> for the following reasons:
<ol>
<li>Vineyards are a carbon sink. A rugby-pitched-sized area of vineyard soaks up a respectable 2.84 tonnes of carbon every year.</li>
<li>Soil quality can be enhanced through fine wine. Soil degradation is hot on the radar for concerned environmentalists.</li>
<li>Organic wine production supports pollinators. Organic or pesticide-free vineyards – often one of the hallmarks of fine wine – helps bees and other pollinators get back on track.</li>
<li>Fine wine is fighting back against single-use plastic. Unlike disposable plastic, fine wine glass bottles are something to be treasured.</li>
<li>Vineyards help fill rocky terrain and hills with plants. The higher altitude acts as a natural pesticide, making it much easier to create organic wines.</li>
</ol>
The combination of sustainable practices and investment potential makes the growing trend of organic wineries a positive development in the wine industry.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Moët Hennessy’s new organic certifications reflect a growing trend in the wine industry

<ul>
<li>Pension funds have increased investment in alternative assets like fine wine by 25% over the past two decades. </li>
<li>Fine wine provides stability and intrinsic value for pension planners, as it is unaffected by geopolitical events or high inflation levels.</li>
<li>Fine wine has delivered impressive returns of 40.3% over the past five years, making it an ideal asset for retirement planning and diversification.</li>
</ul>
Change is in the air. As both the bond and equity markets get shaken by turbulence, pension fund managers are increasingly turning to alternative assets, to hedge against economic shocks. According to one report, pension funds around the world have <a href="https://www.ubs.com/global/en/wealth-management/our-approach/marketnews/article.1582725.html">increased their exposure by 25%</a> over the past two decades. The <a href="https://www.ubs.com/global/en/wealth-management/our-approach/marketnews/article.1582725.html">New York Teachers Retirement System</a>, for example, is plunging a whooping 35% of money into alternative investments.
Private equity, property, hedge funds and commodities are among the most enduring alternative assets. However, little by little, institutional investors are dipping into collectibles like fine wine too. One of Canada’s mightiest pension funds, <a href="https://citywire.com/au/news/canadian-pension-fund-acquires-35-aussie-wineries/a2403610">The Public Sector Pension Investment Board</a>, recently acquired 35 iconic vineyards. <a href="https://www.marketindex.com.au/news/goldman-sachs-upgrades-treasury-wines-to-buy-on-pivot-to-strong-ex-china">Goldman Sachs</a> has also been investing heavily in wineries, with a focus on <a href="https://www.livemint.com/market/stock-market-news/goldman-sachs-jupiter-india-fund-buy-stake-in-sula-vineyards-details-here-11671767470360.html">medium and longer-term returns</a>.
In this article, we’ll unveil what’s making wine so appealing to managers today, and how investors could use this unique asset to bolster their own retirement funds.
<h2>Fine wine’s intrinsic value is reassuring for pension planners </h2>
Unlike most other investments, wine’s world-famous flavors are not impacted by geo-political events or high inflation levels. Instead, they are affected by storage and temperature.
This gives investors – including fund managers &#8211; a welcome sense of reassurance. While they may have no control over the stock market, they can ensure that the wine is well cared for.
Over the decades, retirement planners can rest assured that their wealth is not subject to the twists and turns of the stock market. Instead, it comes from the intrinsic value and exquisite quality within the bottle. This can help to mitigate risk and offer valuable diversification.
<h2>Investors can find a bottle to match their retirement timeframe </h2>
One of the greatest appeals of fine wine is how it improves over time. Naturally, it’s an asset that complements decades-long investment strategies, like retirement plans.
As our <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/04/05/the-pairing-of-old-wine-and-new-markets-trends-in-the-wine-industry/?sh=1ac34e3429ee">CEO, Alex Westgarth, recently commented for Forbes</a>, ‘Fine wine pairs well with younger investors with long-term horizons. A good Bordeaux, for example, can age up to 50 years. This can add a certain stability to your portfolios’.
An excellent wine will always be in high demand as it reaches maturity. And there will almost always be a passionate buyer willing to pay premium prices.
A great advantage for pension planners is that they can probably find a bottle on the market to match their retirement timeframe. While some wines might be best opened in fifty years, others may need just five. Finding the right wine for your unique timeframe can help you to hedge against market losses and meet your investment goals.
<h2>With time, premium bottles become rarer </h2>
As poet, playwright and novelist, Johann Wolfgang von Goethe famously quipped, ‘Life is too short to drink bad wine’. Ultimately, the asset is made to be enjoyed. People open investment grade wine to celebrate occasions or present as gifts. And, with time, certain vintages will become harder and harder to find.
When demand outstrips supply, prices increase. That’s another reason why long-term investments in wine can be a sensible alternative asset for pension planning.
As the climate crisis continues to impact vineyards, the scarcity factor is likely to further increase prices. The delicate and unique flavors in already-bottled wine could be the last of their kind within just a few years. This will further reduce supply.
Meanwhile, demand is growing by the day. The past decades have seen an impressive rise in Millennial and Gen-Z buyers. Sotheby’s have even noticed the average purveyor’s age <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/04/05/the-pairing-of-old-wine-and-new-markets-trends-in-the-wine-industry/?sh=46473d7829ee">shrink from over 60 to under 40</a>.
What’s more, the vast <a href="https://winecap.com/learn/digital-advancements-bring-a-new-generation-of-wine-investors">surge of digital advancements</a> are also bringing in new generations and groups of wine buyers.
If demand continues to grow, the tightening supply should lead to a continued increase in value.
<h2>Fine wine has an impressive record of beating inflation </h2>
There are several reasons why most pension funds begin by investing in equities. It’s partly because managers can afford to take on more risk with longer timeframes. But it’s also to avoid the devastating effects of inflation. Unlike cash, bonds or other debt instruments, equity is generally more inflation-resistant.
Fortunately, fine wine shares this same inflation-resisting quality. This could make it a strong contender for a pension investment plan.
Fine wine has a history of beating inflation. Since 2021, for example, while the UK has endured inflation rates of over 10%, the Liv-ex 1000 index has risen 33%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1465" src="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x219.png" width="700" height="409" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x219.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/3-768x448.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1536x897.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/3-2048x1196.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1200x701.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1980x1156.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
During the middle and final investment years – when the pension pot is most at risk of inflation erosion – a healthy allocation to wine could help mitigate the risk.
<h2>Fine wine has a history of strong returns</h2>
Over the past five years, the fine wine has delivered returns of 40.3%, according to the Liv-ex 1000 index. What’s more, despite the incredibly erratic market, overall performance has been smooth and steady.
This makes fine wine a strong contender retirement planning. <a href="https://winecap.com/learn/fine-wine-as-a-value-and-growth-asset?utm_source=Klaviyo&amp;utm_medium=campaign&amp;audience=all&amp;_kx=Lr2N_Vmq62b9MC_xz19gFev8BfazMarSR3bmvvYnyd0xCmYqKlNOghBkQ4k7fDfk.KMnNaW">Fine wine has both growth and value characteristics</a>, making it well suited for most pension plans.
<h2>How can fine wine be incorporated into a pension?</h2>
Usually the best way to add wine into private pensions – like workplace and Self-Invested Private Pensions (SIPPs) – is to speak to a financial advisor. This is because they can help you structure the fund in the most tax-efficient way.
When it comes to taxes, fine wine already has a head start. Fine wine is <a href="https://winecap.com/learn/fine-wine-taxation-2023">exempt from Capital Gains Tax</a>. Because of this, your advisor may prefer to leave it out of a SIPP altogether and use the tax perks on other assets instead. But probably they would seek to allocate a proportion of fine wine into your overall retirement plan as a hedging asset or long-term growth generator. As an inflation-resistant and illiquid asset, wine generally lends itself to retirement planning well.
If you’d like to find out more about which wines could best suit your pension goals, <a href="https://winecap.com/contact-us">we’d love to talk to you</a>.
&nbsp;

Diversifying retirement portfolios: Why pension fund managers are turning to fine wine

<ul>
<li>Two weeks into the Bordeaux En Primeur campaign about a third of the most popular estates have released their 2022 vintage. </li>
<li>The releases so far have commanded 5% to 25% price premium on last year.</li>
<li>Some of the most successful releases included Beychevelle and Cheval Blanc.</li>
</ul>
The Bordeaux 2022 En Primeur campaign is now in full swing. The past two weeks have seen about twenty of the most important Bordeaux estates release their latest vintage, including Château Beychevelle, Château Cheval Blanc, Château Suduiraut and Château Lafleur.
The majority of the wines have been released at 5% to 25% premium on last year, with price rises often highlighting the relative value and better investment opportunities that back vintages offer.
The best new releases have represented an attractive point of entry into the brand, a combination of adequate pricing and good quality as measured by critic scores. Below we highlight four of them.
<h2>Château Beychevelle – ‘fabulous’</h2>
&nbsp;
<img loading="lazy" decoding="async" class="alignnone wp-image-1477" src="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x196.jpg" alt="Beychevelle" width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/05/3-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/05/3.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
<a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-beychevelle/beychevelle">Château Beychevelle 2022</a> was released En Primeur at €67.50 per bottle ex-négociant, representing a 17.2% increase on the 2021. The wine was offered at £836 per 12&#215;75, up 18.4% on the 2021’s opening price (£706 per 12&#215;75).
However, in the context of back vintages, the 2022 became one of the most attractive offerings in the market today. The wine boasts 95-97 points from Neal Martin (<a href="https://vinous.com/">Vinous</a>), who said it was ‘one of the most seductive Beychevelles I have tasted from barrel’ and ‘one not to be overlooked’. <a href="https://vinous.com/">Antonio Galloni</a> scored it 94-96 points and called it ‘fabulous’.
<a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-beychevelle/beychevelle">Beychevelle</a> has been a brand on the move, seeing consistent price growth both in the shorter and longer-term. In the past year, prices are up 6% on average; they have increased 24% over the last three, and 68% in the past decade.
<h2>Château Cheval Blanc – ‘wine of the vintage?’</h2>
&nbsp;
<img loading="lazy" decoding="async" class="alignnone wp-image-1478" src="https://wp.winecap.com/wp-content/uploads/2023/05/1-375x196.jpg" alt="Cheval Blanc" width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/1-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/05/1-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/05/1.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
<a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Château Cheval Blanc 2022</a> has been another of this year’s campaign successes. The wine is <a href="https://winecap.com/news/neal-martin-awards-three-bordeaux-2022-wines-potential-100-points">Neal Martin’s highest-scoring vintage ever</a> and the latest well-priced release from the château, which seems to have created a sustainable En Primeur strategy.
When we spoke to Cheval Blanc’s technical director, Pierre-Olivier Clouet, he stated:
“The release price depends on many things. The quality of the vintage, the economic context in the world, and the price of new vintages available on the market. At the end, the definition of the price En Primeur is not something so difficult to do. This is something mathematical. En Primeur should be forever the lowest price you can find in your bottle. If you purchase later, it&#8217;s going to be more difficult to find and it&#8217;s going to be more expensive.”
Cheval Blanc 2022 was released at €470 per bottle ex-négociant, up 20.5% on the 2021, and offered internationally for £5,760 per 12&#215;75, up 21.5% increase on last year.
Numerous critics awarded the wine a potential 100-points, including Neal Martin (98-100), Antonio Galloni (98-100), <a href="https://thewineindependent.com/">Lisa Perrotti-Brown MW</a> (98-100), <a href="https://www.thedrinksbusiness.com/">Colin Hay</a> (98-100), <a href="https://www.jamessuckling.com/">James Suckling</a> (99-100), and <a href="https://quarin.com/fr/accueil.html">Jean-Marc Quarin</a> (100).
Other older vintages that represented good value for money included the 2021, 2020 and 2016. Prices on average have risen <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">20% in the last half decade</a>.
<h2>Carruades de Lafite – ‘a real showstopper’</h2>
&nbsp;
<img loading="lazy" decoding="async" class="alignnone wp-image-1479" src="https://wp.winecap.com/wp-content/uploads/2023/05/4-375x196.jpg" alt="Carruades de Lafite" width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/4-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/05/4-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/05/4.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
<a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/carruades-lafite">Carruades de Lafite</a>, the second wine of <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/lafite-rothschild">Château Lafite Rothschild</a>, is another anticipated release that enjoys high demand year after year. The 2022 was released at €180 per bottle ex-négociant, up 12.5% on the 2021. The wine was offered for £2,256 per 12&#215;75, up 13.9% on the 2021 release, which has since risen in value.
Despite the price increases, the 2022 is the least expensive Carruades on the market today. This has not gone unnoticed and the wine has already <a href="https://www.liv-ex.com/2023/05/bordeaux-2022-en-primeur-campaign-updates/">traded at a premium of 21.2%</a> on the secondary market.
Martin awarded it 90-92 points, and Kelley gave it 91-93. It also received 92-94 points from Galloni, who called it ‘a real showstopper’.
From an investment perspective, Carruades de Lafite prices have risen 22% over the last five years, and 63% in the last decade.
<h2>Château Lafleur – ‘intellectual and delicious’</h2>
&nbsp;
<img loading="lazy" decoding="async" class="alignnone wp-image-1480" src="https://wp.winecap.com/wp-content/uploads/2023/05/Lafleur-375x196.jpg" alt="Lafleur" width="750" height="392" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/Lafleur-375x196.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/05/Lafleur-768x401.jpg 768w, https://wp.winecap.com/wp-content/uploads/2023/05/Lafleur.jpg 1200w" sizes="(max-width: 750px) 100vw, 750px" />
In recent years, <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-lafleur/lafleur">Château Lafleur</a> has been offering considerable value in the high-rolling world of Pomerol. The latest release was no exception.
Lafleur 2022 was released at €610 per bottle ex-négociant, up 8.9% on the 2021. It was offered at £7,440 per 12&#215;75, a 14.3% increase on the 2021 release, which has since experienced a significant price growth.
The 2022 received 97-99 points from Neal Martin, who said it was ‘an intellectual and delicious Lafleur – a lethal combination’. Galloni gave it 95-98 and noted that it was ‘shaping up to be majestic’.
The wine also received 98-100 points from Colin Hay and <a href="https://janeanson.com/">Jane Anson</a>, and 100-points from <a href="https://www.falstaff.com/de">Falstaff</a> and Jean-Marc Quarin.
<a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-lafleur/lafleur">Lafleur prices</a> have risen 38% in the last five years, and 83% in the last ten, making it an attractive investment wine.
You can now explore the historic performance of these wines on <a href="https://winecap.com/wine-track">Wine Track</a>. Our tool provides a clear overview of a fine wine’s track record, including critic scores, average price and investment returns.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

En Primeur round-up: The best Bordeaux 2022 releases so far

<ul>
<li>Fine wine&#8217;s value tends to increase when stock markets fall, making it a great hedge option for investors.</li>
<li>Fine wine is proving to be a better portfolio hedge than gold which is showing greater correlation with the stock market in recent years. </li>
<li>As a precious and depleting asset, wine tends to rise above local shocks and is generally less impacted by cost-of-living pressures.</li>
<li>Fine wine has outpaced inflation since 2021, making it a resilient asset to hold in turbulent times.</li>
</ul>
There is a lot going on in the economy, and most of it is not good. Major financial institutions buckle under high interest rates. Central banks are forced to rethink policies. Inflation continues to flirt with double digit levels. And the stock market lurches from one position to another as world events unfold. According to <a href="https://am.jpmorgan.com/us/en/asset-management/adv/insights/portfolio-insights/asset-class-views/asset-allocation/">JPMorgan’s Q2 outlook</a>, ‘2023 looks overwhelmingly likely to be a year of disappointing growth and ongoing adjustment’. Yet, fine wine is generally standing tall, experiencing little to zero negative performance.
In many situations, the value of fine wine has even climbed. As <a href="https://www.cityam.com/investors-reach-for-the-bottle-as-inflation-soars/">CityAM</a> recently reported, ‘while it might not usurp stocks as the backbone of investors’ portfolios anytime soon, wine is providing some stability and solace amid the turmoil’.
In this article, we’ll uncover how fine wine is reacting to today’s tense economy and why.
<h2>The value of fine wine tends to increase as markets go down</h2>
Fascinatingly, the value of wine tends to increase as the stock markets fall. One of the most notable examples was during the financial crisis of 2008. Over autumn, the world economies went into shock. Within six months, the great S&amp;P 500 had plunged by 52%.
<img loading="lazy" decoding="async" class="alignnone wp-image-1462" src="https://wp.winecap.com/wp-content/uploads/2023/05/SP-375x187.png" alt="S&amp;P finance" width="700" height="349" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/SP-375x187.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/SP-768x383.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/SP.png 842w" sizes="(max-width: 700px) 100vw, 700px" />
Source: <a href="https://finance.yahoo.com/quote/%5EGSPC/chart?p=%5EGSPC#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">Yahoo Finance</a>
Yet, while the world’s stock prices zig-zagged downwards, one asset class held up remarkably well. Fine wine (shown in the graph below in red) did not suffer any major downturns. On the contrary, it seemed to have a negative correlation to the stock market. Fine wine prices soared.
<img loading="lazy" decoding="async" class="alignnone wp-image-1463" src="https://wp.winecap.com/wp-content/uploads/2023/05/1-1-375x208.png" alt="Liv-ex 1000 vs S&amp;P 500" width="700" height="388" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/1-1-375x208.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/1-1-768x425.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/1-1-1536x851.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/1-1-2048x1135.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/1-1-1200x665.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/1-1-1980x1097.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
Time and time again, fine wine has outperformed when the stock market is sinking. <a href="https://winecap.com/learn/how-does-fine-wine-react-in-a-recession">This is because of four essential characteristics</a>.
Most recently, fine wine delivered investors double digit returns over the COVID-19 pandemic and global lockdowns. Between April 2020 and September 2022, the asset shot up a staggering <a href="https://www.liv-ex.com/news-insights/indices/">43.5%</a>.
This makes fine wine an extraordinary hedging option for investors. When stocks are tumbling, a reasonable allocation to wine can help to smooth out the overall performance and absorb losses.
<h2>Today, fine wine is a better portfolio hedge than gold   </h2>
The current economic environment is unsteady. Understandably, global asset managers are now looking to buffer against some of the market shocks by increasing their allocations to alternatives and hedging instruments.
One of the most popular choices is gold. According to <a href="https://www.ubs.com/global/en/wealth-management/insights/chief-investment-office/house-view/2023/weekly-key-messages.html?caasID=CAAS-ActivityStream">UBS’ latest report</a>, ‘we are also most preferred on gold and recommend holding it as a portfolio hedge in the current uncertain times’.
However, over the past couple of years, fine wine has started to beat gold at its own game. Since Covid-19, the prices of gold have become more correlated to the prices of the stock market. Looking at the graph below, the performance of gold (in orange) is becoming increasingly aligned to the stock market (for example, the S&amp;P 500 shown in yellow). By contrast, the value of fine wine (red) is the least aligned.
<img loading="lazy" decoding="async" class="alignnone wp-image-1464" src="https://wp.winecap.com/wp-content/uploads/2023/05/2-1-375x222.png" alt="Liv-ex 1000 vs S&amp;P 500 vs Gold" width="700" height="414" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/2-1-375x222.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/2-1-768x454.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/2-1-1536x909.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/2-1-2048x1212.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/2-1-1200x710.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/2-1-1980x1171.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
When it comes to hedging against a turbulent economy, wine is coming out on top. Some economists are now beginning to question <a href="https://winecap.com/learn/is-fine-wine-the-new-gold">if fine wine is the new gold</a>.
<h2>Since 2021, the performance of fine wine has outpaced inflation</h2>
The US inflation rate is gradually coming back to an almost-reassuring level. At the time of writing (<a href="https://ycharts.com/indicators/us_inflation_rate#:~:text=Basic%20Info,in%20price%20over%20a%20year">May 2023</a>), it sits at 4.98%, down from 8.54% in 2022. But it’s more than double the target rate.
In the UK, it’s not looking so good. Inflation now sits at a nerve-wracking <a href="https://tradingeconomics.com/united-kingdom/inflation-cpi">10.06%</a>, meaning that purchasing power is rapidly draining from the pound. At times like this, it’s generally better to hold long-term wealth in assets rather than cash. Physical assets like property, precious metals and fine wine are especially resilient to inflation risk.
Below is a graph showing the UK’s inflation rate over the past five years. Since 2021, it has soared to double digits.
<img loading="lazy" decoding="async" class="alignnone wp-image-1465" src="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x219.png" width="700" height="409" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/3-375x219.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/3-768x448.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1536x897.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/3-2048x1196.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1200x701.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/3-1980x1156.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
If we compare this to the average performance of fine wine in the same time frame (using the Liv-ex 1000 index), wine hasn’t just kept up with inflation. It has beaten it more than three-fold. Between 2021 and 2023 UK inflation rose by just under 10%. By contrast, the average performance of fine wine has increased by <a href="https://www.liv-ex.com/news-insights/indices/">33%</a>.
There are several reasons why wine is so good at outpacing inflation. Firstly, it’s a global asset so it tends to rise above local shocks. When the pound loses value, <a href="https://winecap.com/learn/opportunity-for-asian-and-american-investors">Asian or American investors tend to step in</a>. The wine markets are generally private too. This means that the groups of buyers tend to be very wealthy and sophisticated investors, who are less impacted by the cost of living pressures. They’re generally less swayed by rumors or economic turbulence too.
Perhaps most significantly, wine is a precious and depleting asset. It grows in value and scarcity over time, which will almost always outpace inflation levels.
<h2>Overall, wine is a useful asset in a turbulent economy </h2>
There are so many reasons for turbulence in the economy. Wars, pandemics, political tensions, inflation or the climate crisis to name a few. Yet, the last few years have shown us that fine wine tends to increase in value during these historical moments.
Global demand for investment grade wine outstrips supply more and more every day. As our CEO Alex Westgarth recently explained for Forbes Business Council, <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2023/04/05/the-pairing-of-old-wine-and-new-markets-trends-in-the-wine-industry/?sh=1ac34e3429ee">wine investors are younger, edgier, and more international than ever</a>. Whichever way you look at it, wine and economic turbulence tend to pair well.
As the markets continue to stride forward into uncertainty, it’s a good moment to reconsider alternative assets and hedging strategies.
<a href="https://winecap.com/learn/seven-delicious-reasons-to-invest-in-fine-wine">Discover seven more delicious benefits to investing in fine wine</a>
WineCap’s market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
&nbsp;
&nbsp;

How fine wine hedges against economic shocks: In four graphs

<ul>
<li>Bordeaux 2022 is predestined for long-term ageing rather than drinking young. </li>
<li>Martin found little difference between the First Growths and ‘the others’ in terms of quality. </li>
<li>He singled out Saint-Julien as an appellation to seek out. </li>
<li>Leoville Las Cases, Cheval Blanc and L’Eglise Clinet received 98-100 points. </li>
</ul>
Yesterday, <a href="https://vinous.com/articles/you-re-unbelievable-bordeaux-2022-may-2023">Vinous</a> published Neal Martin’s much anticipated Bordeaux 2022 report, titled “You’re unbelievable”.
<h2>Vintage observations</h2>
Martin found some ‘snow-capped peaks’, ‘show-offs whose talent cannot be denied’ as well as some ‘caveats’ in Bordeaux 2022. Like other critics, he commented on the ‘unbelievable’ freshness given the heat of the growing season.
He remarked that in 2022 ‘there is partial flattening of the hierarchical pyramid’. While ‘release prices will inevitably amplify differences in ranking, in terms of quality, there’s little difference between First Growths and “the others”,’ he observed.
On the question of Right vs Left Bank, the critic said the ‘vintage is more evenly balanced’ but singled out Saint-Julien as an appellation to watch out for, noting that ‘this is as good as it gets’.
He mentioned the wines’ higher alcohol levels compared to the 2021s, that are ‘often above 14%’ but feel ‘less blowsy than in 2018’. He also said that ‘unlike 2019 and 2020, most wines, particularly within its higher ranks, are predestined for long-term aging’.
However, he advised ‘those with a penchant for drinking Bordeaux young [to] seek out another vintage’.
In terms of buying opportunities, he argued that ‘the question is whether initial prices make any purchase worthwhile vis-à-vis other vintages currently on the market’.
<h2>Top-scoring wines</h2>
<img loading="lazy" decoding="async" class="alignnone wp-image-1452" src="https://wp.winecap.com/wp-content/uploads/2023/05/NM-Bdx-22.png" alt="Neal Martin's top-scoring Bordeaux 2022 wines" width="600" height="277" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/NM-Bdx-22.png 914w, https://wp.winecap.com/wp-content/uploads/2023/05/NM-Bdx-22-375x173.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/NM-Bdx-22-768x355.png 768w" sizes="(max-width: 600px) 100vw, 600px" />
While Martin stated that En Primeur is more than just scores, it is important to note that three wines achieved his highest in-barrel range of 98-100 points.
Cheval Blanc 2022, which was among the first releases this campaign, is ‘a wine for those serious about their Bordeaux,’ according to the critic. Vinous’ Antonio Galloni also rated it 98-100 points, noting that ‘it is shaping up to be one of the wines of vintage’. It also makes an attractive investment, with <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Cheval Blanc prices</a> rising an average of 22% over the last three years.
<img loading="lazy" decoding="async" class="alignnone wp-image-1454" src="https://wp.winecap.com/wp-content/uploads/2023/05/CB-375x248.png" alt="Cheval Blanc prices and scores" width="600" height="397" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/CB-375x248.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/CB.png 740w" sizes="(max-width: 600px) 100vw, 600px" />
For Martin, <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-leoville-las-cases/leoville-las-cases">Leoville Las Cases</a> 2022 ‘surpasses the 2018-2020 trio and […] is a ‘tour de force’’.
He described <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-l'eglise-clinet/eglise-clinet">L’Eglise Clinet</a> as ‘a wine that may leave you spellbound’.
Martin also suggested some wines from the cellar which included <a href="https://winecap.com/wine-track/france/bordeaux/margaux/chateau-brane-cantenac/brane-cantenac">Brane-Cantenac</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/chateau-la-conseillante/conseillante">La Conseillante</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-leoville-barton/leoville-barton">Léoville Barton</a>, <a href="https://winecap.com/wine-track/france/bordeaux/saint-estephe/chateau-phelan-segur/phelan-segur">Phélan-Ségur</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-pichon-baron/pichon-baron">Pichon-Baron</a> and <a href="https://winecap.com/wine-track/france/bordeaux/pomerol/vieux-chateau-certan/vieux-chateau-certan">Vieux-Château-Certan</a>.
You can now explore the historic performance of these wines on <a href="https://winecap.com/wine-track">Wine Track</a>. Our tool provides a clear overview of a fine wine’s track record, including critic scores, average price and investment returns.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Neal Martin awards three Bordeaux 2022 wines potential 100 points

<ul>
<li>The US banking crisis has been the biggest since the 2008 financial crisis and has created uncertainty in mainstream markets. </li>
<li>Revisiting key moments in the history of fine wine investment offers valuable insight into the future of the market. </li>
<li>A key difference between fine wine and equities during the last financial crisis was the speed of recovery.</li>
<li>The fine wine market is braced for challenges due to its diversity as the performance of different wines and vintages can balance a portfolio.</li>
</ul>
The recent banking failures have been the biggest since the 2008 financial crisis. Since the beginning of March, regulators have shut down three mid-size US banks – Silicon Valley Bank, Signature Bank and First Republic. In Europe, Swiss giant Credit Suisse was rescued in an emergency deal with rival UBS, which purchased it at a fraction of its closing market value. UBS itself suffered losses during the acquisition – it slid 13% before making a recovery.
While the news echoes the last financial crisis, governments have been providing reassurance that this is not history repeating itself. The current turmoil is partly down to the sharp increase in interest rates, which was aimed to curb inflation.
Still, the banking collapse has had an immediate effect on investor confidence and mainstream markets. European bank shares remain volatile, while US stock markets opened flat this week. Alternative assets and safe havens such as gold and treasuries have enjoyed a boost, as investors have been considering <a href="https://winecap.com/learn/five-low-risk-assets-to-hedge-against-inflation">low-risk assets</a> to put their money.
Reflecting on how the fine wine market has performed during previous challenging macroeconomic events could offer valuable insights into what to expect in the current uncertain environment.
<h2>The fine wine market during the 2008 financial crisis</h2>
Like other markets, fine wine experiences cycles.
<img loading="lazy" decoding="async" class="alignnone wp-image-1447" src="https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-375x243.png" alt="fine wine performance" width="700" height="454" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-375x243.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-768x499.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-1536x997.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-2048x1330.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-1200x779.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/Indices-all-time-1980x1285.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
During the previous financial crisis, the fine wine market suffered a downturn, but it fared better than some other traditional investments such as equities and real estate. Between June 2008 and June 2009, the Liv-ex 100 index, which was heavily weighted towards wines from Bordeaux, fell 18.8%.  Meanwhile, the broader Liv-ex 1000 index, which includes greater number of wines from other regions, dipped 7.4%.
The Knight Frank Luxury Investment Index, which tracks the performance of luxury assets including fine wine, recorded similar figures, with the value of investment-grade wine declining 15% in 2008. By comparison, the S&amp;P 500, a benchmark index of US equities, fell over 37% the same year.
A key difference between fine wine and equities during the financial crisis was the speed of recovery. While the stock market took several years to recover to its pre-crisis levels, the fine wine market turned bullish relatively quickly. By the end of 2009, investment-grade wine had returned to its pre-crisis levels, and by 2010, it had surpassed its previous peak.
Moreover, the performance of fine wine during the financial crisis varied between different regions and vintages. While the Bordeaux market was hit particularly hard, Burgundy and the Rhône performed relatively well.
<h2>The fine wine market – braced for challenges</h2>
The fine wine market of today looks very different from the shape it had fifteen years ago. There are more investable wines than at any other point in history. If Bordeaux accounted for 90% of the market in 2008, today its share sits at 35%, due to the emergence and the proven investment potential of wines outside this dominant French region.
The diversity of this portfolio diversifier has helped it get through swiftly through other more recent challenges, such as Donald Trump’s 25% tariffs on most European wines, and the Covid-19 pandemic.
For instance, Italy and Champagne, which were exempt from the US tariffs, enjoyed steady price appreciation in 2019, while Burgundy suffered. Throughout and after the pandemic, Burgundy and Champagne turned into the top-performing regions.
California also enjoyed rising prices in 2021, and its index hit an all-time high in September last year.
Bordeaux has been moving quietly and steadily, and its relatively mild performance over the last five years has turned it into a region that can offer value for money, especially in ‘off’ vintages.
<img loading="lazy" decoding="async" class="alignnone wp-image-1448" src="https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-375x233.png" alt="regional fine wine investment" width="700" height="435" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-375x233.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-768x477.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-1536x954.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-2048x1272.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-1200x745.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/regional-indices-5-years-1-1980x1229.png 1980w" sizes="(max-width: 700px) 100vw, 700px" />
<h2>Factors influencing the performance of fine wine</h2>
The fine wine market is different from other markets and operates with its own dynamics, such as rarity and exclusivity. Its unique characteristics make it less vulnerable to market shocks and economic downturns than financial markets.
Indeed, its historic performance has shown very low correlation to mainstream markets. As a tangible good that cannot be traded as quickly as stocks, fine wine is generally insulated from rapid price changes.
In general, prices move based on supply and demand, critics’ scores, vintage quality, age and brand appeal. Find out more about <a href="https://winecap.com/learn/fine-wine-investment-for-beginners">fine wine investment here</a>, or explore the performance of individual brands on <a href="https://winecap.com/wine-track">Wine Track</a>.
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WineCap’s market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Banking failures and the fine wine market: Performance during economic uncertainty

<ul>
<li>Marchesi Antinori has taken full ownership of Napa Valley’s iconic winery Stag&#8217;s Leap. </li>
<li>Stag&#8217;s Leap laid the foundation for the emergence of cult wines after winning the Judgement of Paris in 1976.</li>
<li>Antinori&#8217;s innovations in the &#8216;Super Tuscan&#8217; revolution of the 1970s and recent acquisition of Stag&#8217;s Leap position both for continued success in the fine wine investment market.</li>
</ul>
Marchesi Antinori, one of the oldest and largest wine companies in the world, has gained full ownership of the iconic Napa Valley estate Stag’s Leap. <a href="https://www.winespectator.com/articles/antinori-buys-sole-ownership-of-napas-stags-leap-wine-cellars">Wine Spectator</a> has reported that the current sale includes ‘the winery, the brand and inventory, and close to 300 acres of Napa vines, including the Fay and S.L.V. vineyards’.
Antinori has held a minority stake in Stag’s Leap since 2007, when Ste. Michelle Wine Estates purchased it from founder Warren Winiarksi.
Some of the most prominent wineries owned by Antinori include the Super Tuscan Tignanello and Guado al Tasso, as well as Antica Napa Valley.
<h2>Stag’s Leap performance </h2>
Stag’s Leap was among the pioneering Californian wineries that laid the foundation for the emergence of cult brands.
It was its S.L.V. Cabernet Sauvignon 1973 – the winery’s second vintage, and first produced at the estate and in commercial quantities – that won the Judgement of Paris in 1976. Stag’s Leap put Californian wine on the map by winning over its French competitors, which included the First Growths Château Mouton Rothschild 1970 and Château Haut-Brion 1970.
In the fine wine market, demand for Stag’s Leap has grown considerably over the last decade, with prices for its Cask 23 increasing 59% and for S.L.V. – up 61% on average.
<img loading="lazy" decoding="async" class="alignnone wp-image-1431" src="https://wp.winecap.com/wp-content/uploads/2023/05/Image-for-blog.png" width="750" height="487" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/Image-for-blog.png 1014w, https://wp.winecap.com/wp-content/uploads/2023/05/Image-for-blog-375x244.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/Image-for-blog-768x499.png 768w" sizes="(max-width: 750px) 100vw, 750px" />
The brand has been helped by the relative value for money it offers compared to other Californian ‘cult wines’. The <a href="https://winecap.com/wine-track/united-states/california/napa-valley/stag's-leap-wine-cellars/s.l.v.">average price per point for S.L.V.</a>, for instance, is just £19, compared to £472 for <a href="https://winecap.com/wine-track/united-states/california/oakville/screaming-eagle/cabernet-sauvignon">Screaming Eagle Cabernet Sauvignon</a>.
The 2014 vintage has enjoyed particularly strong price performance. Stag’s Leap S.L.V. is up 80.5% since release. Cask 23 has risen 77.4% over the past two years, placing it among some of California’s biggest risers.
<h2>Antinori’s overarching impact</h2>
If Stag’s Leap has greatly contributed to the emergence of California’s cult wines, Antinori’s innovations played a large part in the ‘Super Tuscan’ revolution of the 1970s. Both have managed to re-define ‘fine wine’ outside the confines of Bordeaux, in USA and Italy respectively.
With history that can be traced back to 1385, Antinori has been one of the most successful wine companies. Its <a href="https://winecap.com/wine-track/italy/tuscany/toscana/antinori/tignanello">Tignanello</a> ranked as the 49th most powerful wine brand in the world, due to high trade volume and value. <a href="https://www.liv-ex.com/2022/11/liv-ex-power-100-2022-burgundy/">Liv-ex noted</a> that it was helped by the remarkable value for money it offers being ‘the cheapest Italian wine in the top 100, with an average case price of £1,076’.
While it is yet to be seen how the full acquisition of Stag’s Leap will play out, it seems like both Antinori and Stag’s Leap are poised for continued success and reaching new heights in the fine wine market.
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WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Marchesi Antinori acquires iconic Napa Valley’s Stag’s Leap

<ul>
<li>Jancis Robinson MW and James Lawther MW reviewed the 2022 Bordeaux vintage. </li>
<li>Both critics found the reds to be extremely impressive, with surprising freshness. </li>
<li>Mouton Rothschild, Lafite Rothschild, Cheval Blanc and Pétrus received the highest scores.</li>
</ul>
<a href="https://www.jancisrobinson.com/articles/bordeauxs-surprising-2022-vintage">Jancis Robinson MW</a> and James Lawther MW reviewed the 2022 Bordeaux vintage and released a series of articles, covering the whites, red-bank and left-bank reds.
Both critics found the wines to be ‘extremely impressive’, with ‘amazing freshness’ given the hot and dry growing season.
In terms of the En Primeur tastings, Jancis remarked on the ‘record number of visitors’, with ‘Americans and Asians back in force’. According to her, the numbers at the UGC tastings were ‘even higher than in spring 2019, when the 2018 vintage was presented almost a year before pandemic lockdowns’.
This gives greater confidence in the success of the En Primeur campaign, which commenced last week.
<h2>Left-bank reds</h2>
According to the report, the 2022 harvest was the earliest on record, with most of the Cabernet Sauvignon and Merlot on the left bank picked before the end of September. Despite the early harvest, the grapes’ maturity reached optimal levels. The sugar levels were similar to those found in recent years, while the phenolic ripeness was comparable to or even higher than previous vintages.
Alcohol levels on the left bank were on the high side, with 14% to 14.5% being a regular occurrence. However, the wines were often balanced with freshness.
Lawther wrote that he ‘found the characteristics of most of the appellations respected’, with Margaux being more varied.
<h2>Right-bank reds</h2>
According to Robinson, Merlot did exceptionally well in 2022, with high sugar levels, deep color and ‘no shortage of tannins for a long life lurking below the alluring surface’.
Lawther also proclaimed the grape variety to be ‘the star of the vintage’. He added that ‘Cabernet Franc was also successful on the right bank in 2022 adding colour, floral fragrance, freshness and length’. The critic claimed that ‘combined with Merlot it has produced some stunning wines, even away from the limestone plateau – witness Cheval Blanc, one of the wines of the vintage’.
<h2>White wines</h2>
The hot and dry growing season led to lower acidity levels in the whites, which translated to lack of freshness in some. Robinson further revealed that Sauvignon Blanc and Sémillon were picked earlier than ever before since Bordeaux University records began. Domaine de Chevalier Blanc stood out among the dry whites, while Château Suduiraut received the highest score of 18+ points among the Sauternes.
<h2>Top-scoring wines</h2>
The First Growth Château Mouton Rothschild topped the list of the highest-scoring wines from the 2022 vintage. Lawther described the palate as ‘truly amazing’ and questioned if this isn’t ‘a modern 1986’.
Château Lafite Rothschild, Château Cheval Blanc and Pétrus followed with 18.5-points.
So far, Lafite and Cheval Blanc have been two of the favourite wines of major critics, also boasting potential 100-points from Jeff Leve, Jean-Marc Quarin, and <a href="https://winecap.com/news/james-suckling-releases-bordeaux-2022-report">James Suckling</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1425 " src="https://wp.winecap.com/wp-content/uploads/2023/05/JR-top-scores.jpg" width="540" height="441" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/JR-top-scores.jpg 1012w, https://wp.winecap.com/wp-content/uploads/2023/05/JR-top-scores-375x306.jpg 375w, https://wp.winecap.com/wp-content/uploads/2023/05/JR-top-scores-768x628.jpg 768w" sizes="(max-width: 540px) 100vw, 540px" />
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Jancis Robinson MW releases Bordeaux 2022 scores

As purchasing power slowly drains, investors with low-risk tolerances are feeling the sting. At the time of writing (May 2023), <a href="https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/february2023">UK inflation</a> sits at an uneasy 10.1%. With the average <a href="https://www.bankrate.com/banking/savings/average-savings-interest-rates/#:~:text=National%20average%20savings%20account%20interest,ll%20earn%20on%20your%20savings">savings account interest</a> at a flimsy 0.23%, cash is going backwards. Meanwhile, high inflation munches away the future value of bonds and debt like a deranged Pac-Man. This represents a real problem for wealth managers. In a constantly shifting sea of interest hikes, inflation, and market shocks, how can they maintain and strengthen lower-risk portfolios without going too overweight on equity? How can they keep the cautious risk profile intact without endangering returns?
This article examines five overlooked assets for cautious investors, which have a history of punching back against inflation.
<h2>Gold</h2>
In the fight against inflation, physical gold is surely Mohammad Ali. Gold tends to increase in value as inflation rises. According to <a href="https://www.gold.org/goldhub/research/gold-outlook-2022-mid-year">World Gold Council</a> data from the past 50 years, when inflation is above 3%, the gold prices jump by 14%.
This asset class has the added benefit of being universally accepted. Unlike interest-generating assets or fine wine, precious metals can be included in Shariah portfolios.
Not only is gold inflation-resistant, but it is also classed as a low-risk asset, which must be a welcome relief for low-risk investors. Arguably, gold is even less risky than cash, as its value is intrinsic.
However, that doesn’t mean that there aren’t bubbles and market corrections. Over the past years <a href="https://winecap.com/learn/is-fine-wine-the-new-gold">gold’s performance has shown more volatility</a> alongside the public markets.
<img loading="lazy" decoding="async" class="alignnone wp-image-1419 " src="https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold.png" width="590" height="372" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold.png 2469w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-2048x1293.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-Gold-1980x1250.png 1980w" sizes="(max-width: 590px) 100vw, 590px" />
<h2>Fine wine </h2>
There are several reasons why fine wine kicks back against inflation. It’s a physical asset. The market is global and wealthy, often relatively unaffected by market shocks. Plus, buyers are usually passionate, so they are unlikely to panic-sell. Perhaps most importantly, bottles are unique, and they deplete over time.
The steady returns can help to smooth overall portfolio volatility and reassure clients. According to an index that tracks the performance of 1,000 fine wines from different regions (<a href="https://www.liv-ex.com/news-insights/indices/">Liv-ex 1000</a>), investors have benefited from average returns of 40.3% over the past five years. By contrast, the FTSE 100 delivered just 4.8%. <a href="https://winecap.com/wine-track">You can see the performance of your preferred wines here</a>.
<img loading="lazy" decoding="async" class="alignnone wp-image-1420" src="https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE.png" width="590" height="373" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE.png 2469w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-375x237.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-768x485.png 768w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-1536x970.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-2048x1293.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-1200x758.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/05/LX-vs-FTSE-1980x1250.png 1980w" sizes="(max-width: 590px) 100vw, 590px" />
However, there are downsides. Although wine shields against inflation, it can be difficult to sell quickly. For clients who need to urgently access funds, this asset might not be ideal. What’s more, clients only realise returns after they sell. Unlike with bonds and shares, investors cannot enjoy gains and stay invested.
One solution for wealth managers could be to offer a mix of assets with different liquidity. For example, by combining fine wine, gold and inflation-linked bonds in one portfolio.
<h2>Sustainable energy </h2>
As the prices of raw materials tend to be the first to rise, <a href="https://www.investopedia.com/articles/investing/020816/importance-commodity-pricing-understanding-inflation.asp">commodities</a> are often used to predict and hedge against inflation.
Traditionally this asset class includes oil and non-renewable energy sources. But with the rising regulations and scientific warnings, this may not be a wise or future-proof investment anymore. The EU, for example, is in the process of amending the <a href="https://www.europarl.europa.eu/news/en/press-room/20220909IPR40134/parliament-backs-boost-for-renewables-use-and-energy-savings">Energy Efficiency Directive</a> so that 45% of all European energy will be renewable by 2030. The Green Deal also imposes carbon taxes on dirty providers. Already, around 29% of the world’s energy comes from <a href="https://www.iea.org/reports/global-energy-review-2021/renewables">clean sources</a>, and that figure is likely to increase over the long term.
While green energy can be higher risk, it’s not as precarious as non-renewables. In the same way that whale oil plummeted in 1860, investors left holding fossil fuel stocks in twenty years’ time could find themselves with stranded assets.
<h2>Inflation-linked bonds</h2>
Unlike other debt instruments, inflation-linked bonds are pegged to the recorded inflation levels. So, even in high-inflationary environments, they should retain their value.
A huge advantage of inflation-linked bonds is that they can usually be traded quickly. This could be helpful for wealth managers looking to balance out the illiquidity of fine wine or property.
However, the success of these assets hinges on the accuracy of the indices. Sometimes the consumer goods selected and measured can lead to artificial results. For example, the <a href="https://www.ons.gov.uk/economy/inflationandpriceindices/datasets/consumerpriceinflationbasketofgoodsandservices">UK index</a> contains DVD players and MP3 players. These are probably cheaper than they would have been a decade ago, but it is not because inflation is lower.
<h2>Affordable property</h2>
Property is a classic inflation-resistant investment. But what kind should today’s cautious investors go for? Property addressing the UK’s housing crisis could be fruitful. Despite strong demand, there is currently a shortage of over 4 million homes.
Another interesting area for low-risk investors to consider could be affordable student accommodation. Applications to universities tend to rise during recessions. After 2008, they <a href="https://kpmg.com/uk/en/home/media/press-releases/2022/12/living-standards-take-a-hit-as-the-uk-enters-protracted-recession.html#:~:text=The%20UK%20economy%20will%20shrink%20by%201.3%25%20in%202023%2C%20amidst,see%20GDP%20rise%20by%200.2%25.">increased 31%</a> in the UK. And since 2020, they have reached record-levels. <a href="https://kpmg.com/uk/en/home/media/press-releases/2022/12/living-standards-take-a-hit-as-the-uk-enters-protracted-recession.html#:~:text=The%20UK%20economy%20will%20shrink%20by%201.3%25%20in%202023%2C%20amidst,see%20GDP%20rise%20by%200.2%25.">KPMG</a> anticipate a 16% increase in the number of undergraduates searching for rooms by 2030.
The risk is relatively low, as in many cases, the accommodation will be handled and managed by the university itself. <a href="https://content.knightfrank.com/research/169/documents/en/uk-student-housing-2023-9846.pdf">Yields</a> for investors average at around 5% for London-based lets and 4% for accommodation outside the capital.
But a word of caution, the buy-to-let market is becoming less lucrative every day, with high interest rates and increasing regulations. In the current climate, some are wondering <a href="https://winecap.com/learn/could-fine-wine-be-better-investment-than-property">if the money would be better placed elsewhere</a>.
<h2>Chartering a new course</h2>
Record-levels of inflation are transforming the investment landscape. What made sense yesterday no longer adds up today.
This article aims to help spark ideas for wealth managers. It presents five potential lower-risk investments, that also have famous inflation-shielding qualities.
As wealth managers re-balance portfolios and seek new assets, they can also make the world a better place. Now is the ideal time to incorporate social and environmental factors into the investment strategy. After all, to truly future-proof portfolios, we need a healthy planet.
<a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">Discover five ways fine wine investments are good for the environment.</a>
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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Five low-risk assets to hedge against inflation

<ul>
<li>Bordeaux 2022 is a vintage of ‘potential greatness’ but also ‘heterogeneity’, according to the Wine Advocate’s En Primeur report.</li>
<li>The reviewers, William Kelley and Yohan Castaing, found potential for perfection in eight wines, and included a list of En Primeur recommendations.</li>
<li>Kelley noted that the second wines ‘merit more serious consideration than usual this year’.</li>
</ul>
<h2>Potential greatness and heterogeneity</h2>
During the En Primeur trade tastings last week, and following <a href="https://winecap.com/news/james-suckling-releases-bordeaux-2022-report">James Suckling’s report</a>, another major publication released its assessment of the 2022 Bordeaux vintage – <a href="https://www.robertparker.com/articles/qmTRywWJDRjqcyW6p/france-bordeaux-2022-en-primeur-futures">Robert Parker’s Wine Advocate</a>. William Kelley and Yohan Castaing reviewed 459 wines ‘after several weeks of intensive tasting and hundreds of visits to wineries’.
The critics found ‘potential greatness’ in this vintage that has surprised many, but also ‘heterogeneity’.
Kelley explained that ‘Bordeaux has produced some monumental wines in 2022, but unlike many of the great vintages of the 20th century, the year was not a rising tide that raised all boats’.
He added that ‘at its best, this is a vintage of remarkable concentration, energy and harmony’. According to him, ‘the accumulated experience of 2015, 2018, 2019 and 2020 meant that intelligent winemakers were ready to harvest at the right time, a choice of decisive importance’. However, he noted that ‘the less-successful wines are jammy, astringent and rustic’.
The vintage heterogeneity means that buyers will have to be selective; 2022 ‘is not a year to buy blind,’ the critic argued.
<h2>Top-scoring wines</h2>
<img loading="lazy" decoding="async" class="aligncenter wp-image-1407" src="https://wp.winecap.com/wp-content/uploads/2023/05/WA-Bdx-22.png" width="640" height="354" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/WA-Bdx-22.png 912w, https://wp.winecap.com/wp-content/uploads/2023/05/WA-Bdx-22-375x207.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/WA-Bdx-22-768x424.png 768w" sizes="(max-width: 640px) 100vw, 640px" />
The critics found potential for perfection in eight wines, with <a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-canon/canon-(saint-emilion)">Canon</a>, <a href="https://winecap.com/wine-track/france/bordeaux/pessac-leognan/chateau-les-carmes-haut-brion/carmes-haut-brion">Les Carmes Haut-Brion</a> and <a href="https://winecap.com/wine-track/france/bordeaux/saint-estephe/chateau-montrose/montrose">Montrose</a> coming on top (99-100 points).
Among the three, Les Carmes Haut-Brion has been the best performing investment wine over the last five years, up 56%, while also having the lowest average case price. Castaing singled it out as ‘a strong candidate for the title of wine of the vintage’.
<img loading="lazy" decoding="async" class="alignnone wp-image-1408" src="https://wp.winecap.com/wp-content/uploads/2023/05/LCHB.png" width="660" height="69" srcset="https://wp.winecap.com/wp-content/uploads/2023/05/LCHB.png 1128w, https://wp.winecap.com/wp-content/uploads/2023/05/LCHB-375x39.png 375w, https://wp.winecap.com/wp-content/uploads/2023/05/LCHB-768x80.png 768w" sizes="(max-width: 660px) 100vw, 660px" />
One First Growth, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-latour/latour">Château Latour</a>, was also among contenders for perfection, although the wine is not released En Primeur. Meanwhile, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-mouton-rothschild/mouton-rothschild">Château Mouton Rothschild</a>, received 96-99 points. Kelley called it ‘a brilliant wine that likely sits somewhere between the 2019 and 2020 in quality’.
Kelley also noted that second wines ‘merit more serious consideration than usual this year’. In 2022, they ‘often exhibit similar structure and texture to their grand vin counterparts’.
Apart from their top-scoring wines, the critics made a list of En Primeur recommendations to buy, which included <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-branaire-ducru/branaire-ducru">Branaire-Ducru</a> and <a href="https://winecap.com/wine-track/france/bordeaux/saint-julien/chateau-langoa-barton/langoa-barton">Langoa Barton</a>.
<h2>En Primeur pricing</h2>
A great vintage usually translates to expensive releases.
However, Kelley suggested that there were grounds ‘for optimism with regard to pricing this year,’ if the chateaux take into account the global economic uncertainty and the state of the secondary market.
He remarked that ‘it is not always necessary to purchase great Bordeaux as futures,’ as sometimes older vintages might represent better value today.
To spot the best value opportunities and explore the historic performance of any fine wine brand, visit <a href="https://winecap.com/wine-track">Wine Track</a>. Our tool provides a clear overview of a fine wine’s track record, including critic scores, average price and investment returns.
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WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

Wine Advocate Bordeaux 2022 - Château Canon

Wine Advocate’s top-scoring Bordeaux 2022 wines

The first Bordeaux 2022 En Primeur releases are expected early next month. Ahead of the campaign, we examine the key factors that shaped the 2022 vintage and the current market for Bordeaux.
<h2>Vintage overview</h2>
Bordeaux 2022 is full of promise. Early critical reports suggest that the winemakers have overcome the challenges of the growing season, characterised by extreme heat and drought, and have achieved quality on par with the recent trilogy of great vintages, namely the 2018, 2019 and 2020.
Rainfall levels in 2022 were similar to one of Bordeaux’s greatest vintages, the 2010, although temperatures were higher last year. According to Bordeaux expert, <a href="https://janeanson.com/">Jane Anson</a>, this led to ‘small grapes, thick skins, and clear concentration’.
While one might expect to find ripeness and boldness in the wines, the first En Primeur tasting report, published by <a href="https://winecap.com/news/james-suckling-releases-bordeaux-2022-report">James Suckling</a> last week, suggested that the winemakers have prioritised freshness and lower alcohol, and that the resultant wines have fine structured tannins. Moreover, the critic noted consistent excellence from bottom to top.
However, the apocalyptic hailstorms in June devastated the crop at some estates but provided needed respite from the heat for others. As such, there will be variation in yields between the chateaux.
In terms of overall volumes, the 2022 vintage sits about 15% below the ten-year average but is up 9% on last year. It is also higher than the low-yielding 2013 and 2017 vintages.
<h2>Bordeaux – back in vogue </h2>
The 2022 vintage arrives in a market that is experiencing somewhat of a Bordeaux renaissance.
While on the surface Bordeaux might be losing market share to other regions, secondary market reports suggest that trade for the region has continued to increase in absolute terms: close to 50% since 2010.
Bordeaux has come to represent good value for money, in the context of Burgundy’s, and most recently, Champagne’s relentless price rise.
Moreover, as the bedrock of an investment portfolio, Bordeaux continues to offer the best liquidity in the fine wine market. There is consistent demand for the classed growths, across the full spectrum of vintages, both young and mature. As <a href="https://winecap.com/learn/q1-2023-fine-wine-report">our Q1 report highlighted</a>, some Bordeaux 2011s have broken pricing records since the beginning of the year, spurred by purchasing of ‘rabbit’ vintages for Chinese New Year. Bordeaux proves its relevance again and again.
En Primeur is only one of the ways in which the region cements its place in the world of fine wine. The annual campaign generates considerable attention from trade and critics, the volume and value of wine released is unmatched anywhere in the world, and the best releases offer excellent returns on investment – often at the lowest possible point of entry into a top brand.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.
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Bordeaux 2022 – what to expect?

Our Q1 2023 report has now been released. The report examines how the global financial turmoil of the first quarter impacted the fine wine market, the factors affecting demand, and the best performing wines and regions. Download your free copy today.
<h2>Key findings include: </h2>
<ul>
<li>Mainstream markets had a rollercoaster quarter, but fine wine remained relatively unaffected.</li>
<li>Fine wine prices have risen for two consecutive months after a slow start to the year.</li>
<li>Several Bordeaux 2011s enjoyed heightened demand and rising prices in light of Chinese New Year.</li>
<li>The Burgundy 2021 campaign was met with mixed sentiment from the trade due to low allocations and high prices.</li>
<li>Axel Heinz has left Ornellaia to join Château Lascombes and bring fresh life into the estate, which has been underperforming the Super Tuscan in recent years.</li>
<li>The spotlight is now on Bordeaux, with the En Primeur release of the 2022 vintage, which has been described as ‘very promising’.</li>
</ul>
Click below to download your free copy of our quarterly investment report.

Q1 2023 Fine Wine Report

<h2>‘A new benchmark’</h2>
<a href="https://www.jamessuckling.com/wine-tasting-reports/bordeaux-en-primeur-report-astonishing-2022-sets-a-new-benchmark/">James Suckling</a> has released his report on the Bordeaux 2022 vintage ahead of the upcoming En Primeur campaign. The critic claimed that in the 40 years he has tasted Bordeaux in-barrel, he had ‘never come across anything like the 2022 vintage’.
2022 will stay in memory as one of the hottest years on record, featuring severe droughts and heatwaves. Despite the challenges, Suckling suggested that 2022 ‘gives us hope that both man and nature can adapt to these circumstance and produce outstanding wines, both red and white’.
He further observed that dryness and heat no longer mean bold ripeness in the resultant wines. Most winemakers have prioritised freshness and lower alcohol, ‘picking their grapes at optimal ripeness, with this “al dente” fruit giving a crunchy and clean character to the wines, with fine yet structured tannins’.
Suckling found the young wines to be ‘dynamic and fascinating’ and noted that ‘there was high quality from top to bottom’ – a sign of a great vintage.
<h2>Top-scoring wines</h2>
<img loading="lazy" decoding="async" class="alignnone wp-image-1391 size-full" src="https://wp.winecap.com/wp-content/uploads/2023/04/Table-1.png" width="858" height="350" srcset="https://wp.winecap.com/wp-content/uploads/2023/04/Table-1.png 858w, https://wp.winecap.com/wp-content/uploads/2023/04/Table-1-375x153.png 375w, https://wp.winecap.com/wp-content/uploads/2023/04/Table-1-768x313.png 768w" sizes="(max-width: 858px) 100vw, 858px" />
Suckling found nine candidates for perfection in Bordeaux 2022, awarding them a barrel range of 99-100 points.
<a href="https://winecap.com/wine-track/france/bordeaux/saint-emilion-grand-cru/chateau-cheval-blanc/cheval-blanc">Cheval Blanc</a> stood out as his potential ‘wine of the vintage’, which ‘soars to new heights with its brightness and weightlessness’.
The critic was also full of praise for two Sauternes from <a href="https://winecap.com/wine-track/france/bordeaux/sauternes/chateau-lafaurie-peyraguey/lafaurie-peyraguey">Château Lafaurie-Peyraguey</a>, calling the Crème du Tête ‘magical. The new 1929?’
Only one First Growth made the list, <a href="https://winecap.com/wine-track/france/bordeaux/pauillac/chateau-lafite-rothschild/lafite-rothschild">Château Lafite Rothschild</a>, which Suckling described as ‘a classical Lafite that reminds me of something like the 1986 […] but it&#8217;s so today with its purity and precision’.
A white wine also featured among the top-scoring – Pavillon Blanc du Château Margaux. According to him, this ‘feels like a great Montrachet’ and is ‘one for the cellar’.
<h2>The question of pricing</h2>
Suckling’s verdict on the 2022 vintage is that the quality of the wines is ‘exceptional’ but ultimately ‘the market will decide’ the success of the new releases. ‘High interest rates, volatile stock prices and recent bank failures’ are some of the factors that will influence purchasing of young Bordeaux.
While the excitement of the new is guaranteed, high release prices might make older vintages look more attractive – especially if they offer value, and faster returns on investment.
 
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. <a href="https://winecap.com/schedule-a-call">Schedule your free consultation today</a>.

James Suckling releases Bordeaux 2022 report

<h2>Axel Heinz joins Château Lascombes</h2>
Longtime director and winemaker at Ornellaia, Axel Heinz, is leaving Tuscany to join the Second Growth Château Lascombes as CEO and bring the estate ‘to its full potential,’ reported <a href="https://www.thedrinksbusiness.com/2023/03/ornellaia-winemaker-axel-heinz-to-join-chateau-lascombes/">The drinks business</a>. After 18 years in Italy, Heinz will join Lascombes in time for the 2023 harvest.
Carlton McCoy, managing partner at Lawrence Family Wine, who own the Margaux property, said that the work Heinz ‘has done while overseeing Ornellaia and Masseto have taken this already heralded estate to new heights’.
Indeed, Ornellaia and Masseto have become established as two of the most prominent Super Tuscans, enjoying continuous demand and steady price appreciation. In <a href="https://files.liv-ex.com/Liv-ex_Power_100_Drinks_Business_2020.pdf">2020</a>, they placed among the top ten most powerful wine brands in the world.
<h2>Investment performance of Ornellaia and Lascombes</h2>
The appointment of Heinz is intended to breathe new life into Lascombes, which has seen much slower growth than the Super Tuscan. Over the past five years, Lascombes prices have risen just 2.5%, compared to a move of 45% for Ornellaia.
<img loading="lazy" decoding="async" class="alignnone wp-image-1379 " src="https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes.png" alt="Ornellaia and Lascombes" width="628" height="416" srcset="https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes.png 4300w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-375x248.png 375w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-768x508.png 768w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-1536x1017.png 1536w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-2048x1355.png 2048w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-1200x794.png 1200w, https://wp.winecap.com/wp-content/uploads/2023/04/Ornellaia-Lascombes-1980x1310.png 1980w" sizes="(max-width: 628px) 100vw, 628px" />
At present, the 2012 is Lascombes’ highest-scoring vintage, with 94-points from Robert Parker (<a href="https://www.robertparker.com/wines/yAQKMctavGdmygRzy#professional-notes">Wine Advocate</a>). It is also one of the best offerings on the market, together with the less expensive 2011 (RP 93).
With Heinz soon to be at its helm, Lascombes will be an estate to watch; one likely to generate more critical attention, and rising prices.
You can explore the price performance of both estates on <a href="https://winecap.com/wine-track">Wine Track</a> – our tool, which enables you to identify investment grade wines, spot trends and wine investment opportunities.
Stay tuned – this analysis and more is part of our Q1 2023 report, published next week.

Ornellaia’s Axel Heinz to breathe new life into Château Lascombes

Fine wine offers the benefits of different asset classes. As a long-term investment, due to the inherent premise that it gets better with age, fine wine would traditionally fall under the ‘value asset’ category. This is especially true as investors tend to buy and hold wine for decades before selling at a premium. 
However, since fine wine is a highly sought-after and depleting investment, it shows tremendous growth characteristics too. Over the past year, fine wine has delivered strong returns, with some bottles increasing in value by as much as 550%. This makes it more akin to growth assets. 
Could fine wine be considered both a value and growth asset?
<h2>Value assets have intrinsic value and are usually undervalued</h2>
When investors talk about value and growth assets, they are generally referring to publicly-traded stocks. This could mean huge blue-chip corporations like Coco-Cola, Microsoft, or Tesla, or it could be little-known and up-and-coming stocks. Generally, the market is extremely efficient and so finding an underpriced stock is hard work. Those who dedicate time and research to discovering these undervalued assets are known as value investors. 
Warren Buffet is perhaps the most famous value investor of all time. “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price,” he declares. For Buffet, seeking intrinsic value is the only real way to invest. Perhaps that is why he is such a fan of fine wine investments. Buffet has reportedly said that every portfolio should have at least a 1% allocation to fine wine. 
<h2>The value of fine wine can’t be measured the same way as a stock</h2>
To understand whether an investment offers good value or not, investors usually need to crunch a lot of numbers. But the process is a little harder outside of the stock market. Unlike traditional stocks and shares, analysts would be hard-pushed to calculate the price-to-earnings, debt-to-equity, or price-to-book ratios of fine wine. 
Firstly, this is because bottles, casks or barrels of fine wine do not offer “earnings” in the stock market sense. Bottles cannot pay dividends, and so buyers instead collect all their returns when they sell the asset.
Secondly, prices are variable. As fine wine is usually traded privately or through prestigious auction houses, the final sum is not always predictable – especially if you have two or more extremely passionate bidders in the room. As a result, bid-ask spreads are significantly greater than you’d find on the stock market. 
Finally, forecasting these values can be unreliable because in some cases wine prices are not always publicly available. However, as industry leaders, we do have a lot of this information. If you would like to get <a href="https://winecap.com/wine-track">an insider idea of the latest auction results and performances, check Wine Track</a>. 
While we may not be able to scrutinize the value of fine wine in the traditional sense, we can analyse the general trends and characteristics. From here, we can see how they hold up against traditional value stocks. 
<h2>Fine wine shares many of the long-term characteristics of value investments</h2>
As an asset class, fine wine behaves like a value investment. Some of the main characteristics are the “buy low, sell high” strategies, the long-term investment horizon, and stable financial returns. 
<ul>
<li style="font-weight: 400;" aria-level="1">
<h3>“Buy low, sell high” strategies </h3>
</li>
</ul>
Value stocks are generally underpriced on the market, meaning investors expect to make profits over time as the asset realises its true worth. This is remarkably similar to fine wine investments. Many purveyors will purchase the wine en primeur before it is even bottled to secure the best price. 
 
At the time of writing, wines such as <a href="https://winecap.com/wine-track/france/burgundy/bourgogne-aligote/domaine-d'auvenay/bourgogne-aligote-sous-chatelet">Domaine d’Auvenay</a> have already delivered returns of nearly 8,500% over a ten-year period. This shows the incredible power of buying wine early, and holding. 
<ul>
<li style="font-weight: 400;" aria-level="1">
<h3>Buy and hold over the long-term</h3>
</li>
</ul>
As the adage goes, fine wine gets better with age. High-quality Bordeaux, for example, takes 20-30 years to mature. Successful investors will generally buy and hold fine wine over the long-term. 
This approach mirrors the “value” philosophy perfectly. As Buffet himself warns, “If you aren&#8217;t willing to own a stock for 10 years, don&#8217;t even think about owning it for 10 minutes”.
<ul>
<li style="font-weight: 400;" aria-level="1">
<h3>Steady returns</h3>
</li>
</ul>
Stability is another key characteristic of value investments. These assets should be able to <a href="https://winecap.com/learn/3-rules-for-fine-wine-investors">sail through all kinds of market storms with minimal or zero disruption</a>. Fine wine has delivered exceptionally stable returns over the last year, <a href="https://winecap.com/learn/how-does-fine-wine-react-in-a-recession">holding up against recessions</a> and incrementally gaining value despite stock market chaos. 
<h2>Fine wine has compelling growth attributes too</h2>
On the face of it, fine wine seems to be a value investment. It is a steady long-term asset which gains value over time. Yet, despite its famous stability, this investment has also delivered some impressive short-term returns and it is an alternative asset, which push it more into the growth category. 
<ul>
<li style="font-weight: 400;" aria-level="1">
<h3>Fine wine is an alternative asset </h3>
</li>
</ul>
Investors looking for growth assets tend to accept volatility risk, as part of the trade-off for superior returns. Because of this, they are more inclined to look away from the reassurance of the stock market to find new revenue streams. Increasingly, unlisted property, private equity, hedge funds, high yield credit, long-duration bonds and alternative debt are finding their way into growth funds and portfolios.
 As an alternative asset, fine wine seems to fit snugly into the “growth” category. Yet, unlike these investments, fine wine is generally not volatile. 
<ul>
<li style="font-weight: 400;" aria-level="1">
<h3>Exceptional short-term returns </h3>
</li>
</ul>
Wine can, however, deliver exceptional short-term returns. Over just five years, <a href="https://winecap.com/wine-track/france/burgundy/saint-aubin/hubert-lamy/saint-aubin-derriere-chez-edouard-cuvee-haute-densite">fine wines such as Hubert Lamy have seen values increase by 1,223%.</a> This is an extraordinary performance. To put this it into context, it took value stock Coco-Cola 24 years to deliver returns like this. 
Some fine wines are even demonstrating market-beating returns in extremely short timeframes too. Some brands like <a href="https://winecap.com/wine-track/france/burgundy/saint-aubin/hubert-lamy/saint-aubin-derriere-chez-edouard-cuvee-haute-densite">Hubert Lamy</a> have enjoyed increases of over 450% in just three months. If you’d like to explore the greatest gains and losses in the industry, <a href="https://winecap.com/wine-track">Wine Track is a useful resource</a>. As you read, please remember that experts do not recommend investing for less than five years. 
<h2>Fine wine offers the best of both worlds </h2>
Fine wine is a fascinating alternative investment because it seems to offer the best of both value and growth without the downfalls.  
Fine wine is a buy-and-hold asset which increases in intrinsic value over several decades, while offering historically-superior returns. It also holds up well in recessions and <a href="https://winecap.com/learn/is-fine-wine-inflation-proof">fights back against inflation</a>. These are all classic characteristics of value investments. 
Meanwhile, some bottles have proven to be extremely lucrative over the short-term. These boosts in value are likely to continue <a href="https://winecap.com/learn/how-climate-change-affects-value-of-fine-wine">as climate change ramps-up demand for scarce flavours</a>. High gains in short periods of time – especially from alternative assets – are usually more commonly associated with growth investments. 
Therefore, fine wine is an incredibly versatile asset, suitable for different kinds of investment strategies. Whether you’re looking for value, growth or both, fine wine could help you reach your goals faster. 
<a href="https://winecap.com/start-investing">Explore your investment options</a>
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Fine wine as a value and growth asset

The “60% stocks and 40% bonds” rule is outdated. While this approach may have offered stable and diversified returns several decades ago, in today’s difficult economic climate it’s not enough. This is where collectable assets come in.
To preserve and grow wealth, <a href="https://winecap.com/learn/7-under-used-alternative-investments">strategic investors must hedge their portfolios with alternative sources of value</a>. One way to do this is with collectable assets. As a unique form of asset class, collectables offer investors extraordinary diversification and inflation-shielding properties – perfect for today’s economic storm. What’s more, many of these assets – like jewellery, classic cars, and art – can be enjoyed while they hold their value.
In this article, we’re looking at the six most popular collectable assets globally<a href="#_ftn1" name="_ftnref1">[1]</a>, and what to consider as you explore your options.
<h2>Art</h2>
As with most collectables, original art is about more than simply the financial return. Art is a passion asset – it represents a unique timestamp in our history, emotions, and popular culture. But there are great investment benefits too.
Original art is unique, and – just like with fine wine &#8211; rarity is highly prized. Famously, Leonardo di Vinci’s “Salvatore Mundi” was auctioned for a record-breaking $475 million<a href="#_ftn2" name="_ftnref2">[2]</a>.
Importantly, original art is also inflation-resistant. This is an excellent quality for the current economic climate. Unlike cash or bonds, the investment return will not erode over high-inflation periods because it has intrinsic value. Instead, market demand is driven by the artist, story, quality of the work, whether it represented a new technique, mindset or time, the materials and of course, the way it looks.
However, this doesn’t mean art is immune to volatility. The art market has trends and bubbles too. In 2018, for example, the resale market for art by Damien Hirst was declared a “bloodbath” as the hype ended and investors lost millions<a href="#_ftn3" name="_ftnref3">[3]</a>. Before diving in, pay close attention to any potential risks in the market.
Research from Unbiased found that overall contemporary art has delivered annualized returns of 7.5% to investors since 1985<a href="#_ftn4" name="_ftnref4">[4]</a>. Another index, created by Masterworks suggests blue-chip paintings (the crème de la crème of art) increased in value by 13.8% each year since 1995<a href="#_ftn5" name="_ftnref5">[5]</a>. However, each artwork is unique and so individual returns vary significantly.
In today’s market, <a href="https://winecap.com/learn/digital-advancements-bring-a-new-generation-of-wine-investors">NFTs</a> (non-fungible tokens) and sustainable processes are trending strongly in the art world. The average collector invested $46,000 in digital art last year and would be <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">willing to pay more for environmentally-friendly works</a><a href="#_ftn6" name="_ftnref6">[6]</a>.
<h2>Whisky</h2>
As well as an appreciation for the craft and heritage, there are compelling investment benefits to whisky. Firstly, like all the collectable assets on this list, it is a great hedge against inflation. This helps to offset some of the losses from cash, debt, and bond instruments.
Secondly, it’s a booming market, as whisky has become popular. Just like fine wine, <a href="https://winecap.com/learn/digital-advancements-bring-a-new-generation-of-wine-investors">this has largely been fuelled by younger investors</a>.  In 2021, the Knight Frank Luxury Index even named this liquid gold as its best-performing asset class<a href="#_ftn7" name="_ftnref7">[7]</a>. Over the previous decade, Scotch whisky racked up impressive returns of 428% on average. In July 2022, one rare bottle pulverised all records, going for a whopping £16 million at auction.
Thirdly, whisky is increasingly perceived as reliable. Since Brexit and the war in Ukraine, many investors have turned to whisky as a more dependable and palatable choice of beverage. Naturally, the ingredients come from Scotland, so global grain and raw goods shortages should not hinder production. What’s more, the whisky trade looks set to increase, as the UK government draws up new deals with India.
Just like fine wine, one of the greatest benefits of whisky is that it is classed as a “wasting asset” and is not subject to capital gains tax. If you’d like to find out more about this tax break<a href="https://winecap.com/learn/fine-wine-taxation-2022">, you can download our free guide.</a>
To get an idea of the financial returns of whisky, we can look at two indices. The BC20 index reported 14.36% returns for the asset in 2021<a href="#_ftn8" name="_ftnref8">[8]</a>. And the SWI’s year-on-year historical performance sits at 12.5%<a href="#_ftn9" name="_ftnref9">[9]</a>. Of course, whisky is a buy-and-hold asset, meaning that investors should not try to “flip” it, but rather hold the asset for years.
<h2>Classic cars</h2>
Of all the passion investments, classic cars are probably among the most loved. Collectors are often people who would tack magazine cut-outs of Ferraris, Maseratis and Bugattis to their walls as teenagers, and dream of buying the car one day. They tend to be looking to fulfil a lifelong dream as well as investing. Perhaps for this reason, the price tags are usually emotional, and they can make for uncertain investments.
The factors which make a car a worthwhile collectable asset closely mirror the art market. The historic significance of the model, rarity, beauty, racing history or associations with celebrities all add to the value.
HAGI (Historic Automobile Group International) tracks the market with several indices. Their findings show that between 2008 – 2021 the average price increased by 264.49%<a href="#_ftn10" name="_ftnref10">[10]</a>. However, this doesn’t appear to factor in the cost of repairs, renovations, or storage. Even if you plan to restore a classic car yourself, the associated costs can exceed the end-value.
As you plan your investment strategy, scrutinise the financials of classic cars, including tax implications. For example, selling a classic car for a profit will incur capital gains tax, as well as road tax and MOT. Certain countries also have combustion engine regulations and low-emission zones that could make it difficult to drive your car. What’s more, incoming legislation around petrol cars may affect the desirability of the vehicle.
<h2>Diamonds</h2>
They’re forever, they’re a girl’s best friend … but are diamonds really a good investment asset? Looking at the Idex Diamond Index, on average, the precious stones have delivered returns of 8% over the past five years<a href="#_ftn11" name="_ftnref11">[11]</a>. Natural blue diamonds have particularly fared well, with one rare 15-carat blue diamond selling for $57.5 million in April 2022<a href="#_ftn12" name="_ftnref12">[12]</a>.
As with most collectable investments, quality, rarity, historical significance and whether it was owned by a notable person, all make a difference to the value. For jewellery, connections with royalty can especially add lasting value<a href="#_ftn13" name="_ftnref13">[13]</a>. When considering diamonds, scrutinize the following “Cs”: Carat, clarity, cut, colour and certificate<a href="#_ftn14" name="_ftnref14">[14]</a>.
However, there are some risks for diamond investors too. The market is notorious for its bubbles. Between November 1st 2021 and March 7th 2022, for example, prices suddenly jumped by 17% and then fell back down.
Investors should also be aware that this asset – while not directly impacted by inflation – does tend to stumble following a crisis, although it usually bounces back quickly. This indicates that during a recession is a good time to buy. As the prices tend to drop in the rough diamond market first, investors may be able to use this information to predict trends and inform their selling strategy on the secondary market.
<h2>Watches</h2>
Watches are a relatively new investment vehicle, and the market is white-hot. They really began to take off during the first months of the pandemic. Between January 2020 and April 2022, the value of used luxury watches jumped by around 115%<a href="#_ftn15" name="_ftnref15">[15]</a>. According to the Watch Charts Market Index, prices surged from $25,420 on average to $54,461 in less than two years<a href="#_ftn16" name="_ftnref16">[16]</a>.
Today, however, the market is cooling. Prices have dipped back down to $39,397 on average<a href="#_ftn17" name="_ftnref17">[17]</a>. After this burst, it is also extremely difficult now to access an investment-grade watch unless you have exceptional contacts or a broker. However, with patience and research, it is still possible.
For investors looking for a wearable investment, a classic brand like Rolex, Patek Philippe, Audemars Piguet or Breitling could be a good inflation-resistant option.
<h2>Fine wine</h2>
Of course, our favourite collectable asset to preserve and grow wealth is fine wine. Unlike diamonds, the value of fine wine does not tend to dip with recessions. On the contrary, after the 2008 financial crisis and the 2020 pandemic, it soared. From April 2020 until September 2022, prices steadily increased by over 40%<a href="#_ftn18" name="_ftnref18">[18]</a>.
Like whisky investments, fine wine also benefits from a generous tax break. Investors are exempt from capital gains tax, meaning they can keep significantly more of their profits. This tax perk applies to very few investments, and certainly none on the publicly traded stock market. It helps investors to preserve, reinvest and grow their wealth faster.
Like all the collectable assets on this list, fine wine is also extremely inflation-resistant. As the market is quite closed and determined by passionate investors, it is not directly impacted by the ebbs and flows of the wider economy.
Better still, unlike newer whisky and watch trends, fine wine is one of the oldest investment assets. Over centuries wine has proved its place as a valuable source of wealth growth and preservation. <a href="https://winecap.com/learn/is-fine-wine-the-new-gold">Today, it is even more stable than gold</a>.
<h2>Invest with passion</h2>
Perhaps most importantly of all, fine wine is a revered and much-loved product. Who could imagine a world without a sparkling <a href="https://winecap.com/news/moet-hennessys-champagne-stocks-running-low">Moët Hennessy Champagne</a>, or a <a href="https://winecap.com/learn/insights-from-leading-bordeaux-fine-wine-producers">beautifully bold Bordeaux</a>?
When you invest in collectable assets, you are not simply making a financial decision. You’re helping to preserve and cherish that which you love about life. Whether it’s a vintage Porsche or a stand-out piece from your favourite artist, your wealth can revive your most meaningful moments in history. With investments like fine wine, you can also help to preserve and <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">nurture the planet for future generations too.</a>
If you’d like to discover more, <a href="https://winecap.com/">getting started with WineCap is simple and straightforward</a>.
<a href="#_ftnref1" name="_ftn1">[1]</a> Source: <a href="https://www.knightfrank.com/wealthreport/luxury-investment-trends-predictions/">Knight Frank</a>
<a href="#_ftnref2" name="_ftn2">[2]</a> Source: <a href="https://artincontext.org/most-expensive-paintings/">Art in Context</a>
<a href="#_ftnref3" name="_ftn3">[3]</a> Source: <a href="https://www.arthistorynews.com/articles/5279_The_Hirst_sale_bloodbath">Art History News</a>
<a href="#_ftnref4" name="_ftn4">[4]</a> Source:<a href="https://www.unbiased.co.uk/discover/personal-finance/savings-investing/how-to-invest-in-art-is-it-a-good-investment"> Unbiased</a>
<a href="#_ftnref5" name="_ftn5">[5]</a> Source: <a href="https://www.masterworks.com/">Masterworks</a>
<a href="#_ftnref6" name="_ftn6">[6]</a> Source: <a href="https://www.artbasel.com/stories/seven-key-takeaways-from-the-2022-art-market-survey-collectors">Art Basel</a>
<a href="#_ftnref7" name="_ftn7">[7]</a> Source: <a href="https://www.knightfrank.com/wealthreport/luxury-investment-trends-predictions/">Knight Frank</a>
<a href="#_ftnref8" name="_ftn8">[8]</a> Source: <a href="https://braeburnwhisky.com/whisky-casks-offer-investors-protection-against-volatility/">Braeburn</a>
<a href="#_ftnref9" name="_ftn9">[9]</a> Source: <a href="https://www.insider.co.uk/news/whisky-investment-scams-27635375">Insider</a>
<a href="#_ftnref10" name="_ftn10">[10]</a> Source: <a href="https://www.investopedia.com/articles/investing/101915/investing-collectible-cars-top-tips-and-risks.asp">Investopedia</a>
<a href="#_ftnref11" name="_ftn11">[11]</a> Source: <a href="http://www.idexonline.com/diamond_prices_index">Idex Online</a>
<a href="#_ftnref12" name="_ftn12">[12]</a> Source: <a href="https://www.forbes.com/sites/carlieporterfield/2022/04/27/rare-15-carat-blue-diamond-sells-for-575-million-barely-under-world-record/?sh=7ff3dc9c66f3">Forbes</a>
<a href="#_ftnref13" name="_ftn13">[13]</a> Source: <a href="https://www.bloomberg.com/news/features/2022-03-10/jewelry-as-investment-how-to-build-portfolio-with-best-gems-designers?leadSource=uverify%20wall">Bloomberg</a>
<a href="#_ftnref14" name="_ftn14">[14]</a> Source: <a href="https://www.newbondstreetpawnbrokers.com/blog/how-to-invest-in-diamonds-what-you-should-know/#:~:text=While%20prices%20can%20and%20do,to%20market%20price%20as%20possible.&amp;text=It's%20not%20always%20possible%20to,makes%20for%20a%20viable%20asset.">New Bond Street Pawn Brokers</a>
<a href="#_ftnref15" name="_ftn15">[15]</a> Source: <a href="https://watchcharts.com/watches/price_index">Watch Charts</a>
<a href="#_ftnref16" name="_ftn16">[16]</a> Source: <a href="https://watchcharts.com/watches/price_index">Watch Charts</a>
<a href="#_ftnref17" name="_ftn17">[17]</a> Source: <a href="https://watchcharts.com/watches/price_index">Watch Charts</a>
<a href="#_ftnref18" name="_ftn18">[18]</a> Source: <a href="https://app.liv-ex.com/#/analysis-tool/charting-tool">Liv-ex</a>
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Collectable Assets to Help Shield Inflation and Boost Diversification

For more than 6,000 years gold has been revered and collected by people hoping to store, preserve and even grow their wealth. But in recent times, the stability of gold has been called into question. Prices have been on almost as much of a journey as the stock markets. Whether it’s because Central Banks are buying record amounts of the precious metal, or because investors are trading emotionally, the asset is no longer such a dependable source of alternative value.
In this article, we’re taking a closer look at gold’s investment performance over the past year, and how it compares to fine wine.
<h2>Gold is becoming more volatile</h2>
Investors have been on a tumultuous journey. Over the past year, the price of gold plummeted by -21% between March and October<a href="#_ftn1" name="_ftnref1">[1]</a>. Then it rose again by +15% from November through to January. At the time of writing (January 2023), one ounce of gold costs $1,868<a href="#_ftn2" name="_ftnref2">[2]</a>, but economists are already predicting further movements ahead.
<h2>Performance of gold over the past twelve months</h2>
Over 2023, a range of factors is likely to influence the price of gold. The mild global recessions, geopolitical uncertainties and continued high inflation levels will probably increase its value. But on the other hand, pressure on commodities and the gradual easing of inflation could bring the prices down. Over the next year, it’s unlikely that prices will remain stable.
<h2>Gold is becoming increasingly correlated to the stock market</h2>
As gold usually <a href="https://winecap.com/learn/how-does-fine-wine-react-in-a-recession">rallies in a recession</a> and falls during periods of prosperity, investors have traditionally added this to portfolios as a hedge. When the stock markets are down, they look to their gold investments to buffer some of the losses. However, over the past few years, something strange has happened. Instead of gold going up when the markets go down, the two are starting to correlate.
<h2>Fine wine delivered returns that were uncorrelated to the market</h2>
By contrast, over the past year fine wine have exhibited the very characteristics that investors usually look for in gold. Performance has been stable, steady and – best of all – uncorrelated to the stock market. The graph below shows the comparison of fine wine (green), gold (red) and the S&amp;P 500 performance over the past year.
Unlike gold, the fine wine index (Liv-ex 1000) didn’t demonstrate any periods of correlation with the wider stock market during 2022. Overall, wine steadily trended upwards, slightly increasing when the wider markets plummeted and slightly dipping when the wider markets soared. This makes fine wine an exceptionally stable diversifier for investors. Not only did it hedge portfolios over 2023, but it also helped to smooth out overall volatility.
If you’d like to analyse the performance of fine wine, you can <a href="https://winecap.com/wine-track">find the prices for regions, bottles, wines and more on Wine Track</a>.
<h2>Is fine wine the new gold?</h2>
While it may not be exactly true that fine wine is the “new gold”, over the past year this asset class has been significantly more stable and less correlated to the wider market. It’s provided investors with a more calm and smooth positive performance than gold, throughout the economic storm.
Like gold or property, <a href="https://winecap.com/learn/is-fine-wine-inflation-proof">fine wine has intrinsic value and compelling inflation-resistance</a>. As a tangible asset, it will almost always be worth something – unlike stocks, bonds or cash which could crash. But different from gold, the kind of buyers who invest in fine wine are not cut from the same cloth as stock market investors.
Fine wine is generally bought and sold in exclusive private markets, far away from public trading forums. The asset is also usually purchased and treasured by passion investors, who tend to hold it for decades. By contrast, <a href="https://winecap.com/learn/could-fine-wine-be-better-investment-than-property">more people seem to be “flipping” gold and property</a>, which ramps-up volatility.
So, is fine wine the new gold? Not really… If you’re looking for stability, alternative returns, and uncorrelated market value, we think it’s superior.
<a href="#_ftnref1" name="_ftn1">[1]</a> Source: <a href="https://www.monex.com/gold-prices/">Monex</a>
<a href="#_ftnref2" name="_ftn2">[2]</a> Source: <a href="https://www.monex.com/gold-prices/">Monex</a>

Is Fine Wine the New Gold?

Last week we saw the release of the much-anticipated newest vintage of Pauillac’s revered first growth, Château Latour 2015. Having renounced their involvement in the yearly en primeur campaign back in 2012, the acclaimed producer focuses on releasing wines on their own terms after several years of aging, a strategy that reinforces the exclusivity of celebrated vintages such as this. This is the first “prime” vintage of Latour to come onto the market since 2011.
In the years immediately following their withdrawal, trading volumes of Latour on Liv-ex reduced, as was to be expected. However, since new vintages began to release in 2020 trading volumes have increased, with price performance also improving as the greater volumes available leads to more eyes on the brand.
2015 saw excellent conditions thanks to a hot and dry early summer followed by a cooler, damper August shortly after. With healthy, uniform fruit at harvest, critics were quick to declare it as one of the best vintages of the century so far. Adhering neatly to Jancis Robinson’s rule of fives, whereby vintages divisible by five are often of excellent quality, the vintage has shown remarkable tannic structure and power in similar, left-bank wines. Latour 2015, however, offers even greater longevity and will likely develop into a serious wine of quality and value over several decades.
Decanter Bordeaux expert Georgie Hindle rated the vintage at 98 points, describing it as “still youthful and quite serious but there’s something so appealing about it.” As the youngest vintage available on the market, coming in at a price below the much-hyped 2009 and 2010 vintages, Latour 2015 represents a very exciting prospect for investors given its iconic reputation and impressive performance in the past.
As a whole, Bordeaux offers fantastic value this year, considering the rising prices of Burgundy and Champagne, and with new measures coming into effect regarding <a href="https://winecap.com/news/fine-wine-as-a-wasting-chattel">capital gains tax thresholds</a>, a well-priced vintage such as Latour 2015 that will likely perform well could be an excellent addition to any portfolio.
If you’d be interested in adding Latour 2015 to yours, do not hesitate to get in touch. Keep an eye out for email offers soon.

Latour 2015 Released

From April 6, the British government will move to reduce the deficit through a number of <a href="https://www.cnbc.com/2022/11/17/uk-finance-minister-announces-tax-hikes-and-spending-cuts-says-country-is-in-recession.html#:~:text=Finance%20Minister%20Jeremy%20Hunt,%20in%20his%20hotly%20anticipated%20inaugural%20Autumn%20Statement,%20outlined%20spending%20cuts%20and%20tax%20hikes%20worth%20%C2%A355%20billion.">measures</a>, including very significant changes to capital gains tax thresholds. However, investors may find that “wasting chattel” investments could be a worthwhile solution to this.
From the new financial year 2023-2024, the threshold for paying capital gains tax (CGT) will be <a href="https://www.gov.uk/government/publications/autumn-statement-2022-documents/autumn-statement-2022-html#:~:text=reduce%20the%20Capital%20Gains%20Tax%20Annual%20Exempt%20Amount%20from%20%C2%A312%2C300%20to%20%C2%A36%2C000%20from%20April%202023%20and%20to%20%C2%A33%2C000%20from%20April%202024.%20These%20measures%20will%20raise%20over%20%C2%A31.2%20billion%20a%20year%2C%20from%20April%202025.">slashed</a>, from £12,300 to £6,000 this year, and then again to £3,000 the following year – a full 75% fall. This added tax burden will inevitably eat into investor returns. However, the category of investments known as &#8220;wasting chattel&#8221; is exempt from CGT altogether, meaning that any gains made on these investments will allow investors to keep more of their profits.
Wasting chattel investments are assets with a predictable useful life not exceeding 50 years and can include things such as art, furniture, vehicles, and most importantly, fine wine. These may provide investors with a tax-efficient way to profit.
If you&#8217;re looking to balance out tax losses and protect your portfolio against inflation, then allocating more of your portfolio to wasting chattels may be a smart move. Collectible assets such as fine wine are often <a href="https://winecap.com/learn/is-fine-wine-inflation-proof">inflation-resistant</a> and have a long history of good returns. They can therefore provide a much-needed buffer against the current economic environment; helping ensure the long-term success of your portfolio and the security of your financial well-being.
In these difficult economic times, adaptability is paramount, and it is essential for investors and portfolio managers to remain flexible by considering all investment tools and vehicles. Wasting chattels kick back against the upcoming tax hits, and can be an excellent option.
If this sounds like something of interest to you, why not schedule a <a href="https://winecap.com/start-investing">consultation</a> with WineCap? Our wine investment experts would be only too happy to guide you through the process.

Fine Wine as a Wasting Chattel

Fine wine offers you a sound and lucrative investment. While traditional investors have only fairly recently discovered the tremendous opportunities available with fine wine, collectors have known about its profit-making value for hundreds of years. Through the centuries, shrewd wine lovers have been selling part of their collections as a way of subsidising their consumption, leveraging the gains of a uniquely rarifying asset against their own cellars.
Granting easy access to this highly lucrative asset, WineCap offers extensive advice from a team of seasoned experts who can help with sourcing, storage and other crucial aspects to wine investment. With the benefit of our industry-leading technology, we can help you make the most of a bespoke portfolio and reach your investment goals. 
Acting as agents, we take care of sourcing your wine and organising its storage and insurance while you remain in complete control over your investment. Thanks to our links to the UK, you’ll benefit from the most developed secondary fine wine market there is. You’ll also enjoy access to the worldwide wholesale market via the London International Vintners Exchange known as Liv-ex, allowing you to secure a fast and fruitful sale once you’ve reached your investment goals. Lastly, we feature an unparalleled global reach while being tactically positioned in London, the fine wine market’s premier hub.
Click the button below to download our Fine Wine Taxation Guide and learn more about our proven strategy for investment success. Do not hesitate to get in touch and speak to one of our wine investment advisors for further information and to reserve your allocations.

Two fine wine bottles next to an oak barrel

Fine Wine Taxation | Guide

Chinese wine imports have begun their revival as borders reopened to international travel following three long years of Covid restrictions that isolated the world’s most densely populated country.
As families reunite and look forward to a much needed period of recovery, the wine trade breathes a collective sigh of relief after surviving <a href="https://asiawinenews.com/2022/04/chinas-q1-2022-wine-imports-fall-20/">2022</a>, the year that saw the wine industry “hit rock bottom in both <a href="https://winecap.com/news/china-suspends-aus-nz-imports">import</a> and domestic market[s]”
An <a href="https://vino-joy.com/2023/02/04/chinese-wine-trade-bullish-on-rebound-but-cautions-remain/">article</a>, published by China’s leading wine news site Vino Joy News, examines the potential for a rebound in Chinese wine imports which dropped significantly in 2020 due to the successive lockdowns of the pandemic. The decline in corporate activities and cultural gatherings which usually drive crucial sales peaks saw revenues affected drastically. Experts are positive that the recent lifting of Covid restrictions will rejuvenate the market akin to the swift recovery of the restaurant industry since December’s relaxation of pandemic constraints.
The key factor driving this optimism is the increased demand for better quality wine from China&#8217;s increasingly affluent middle class. This is set to be further boosted by the recent relaxation of import tariffs, making wine more affordable for Chinese consumers. This year’s Spring Festival has seen revenues spike which suggests that other events like the Mid-Autumn Festival and National Day will have a similar effect.
Though there is a potential for the relaxation of Chinese food and beverage standards this is unlikely to affect the fine wine market, and overall the long-term outlook for Chinese wine imports remains very promising.
A key indicator of the market’s recovery will be the upcoming Chengdu wine fair in April, an event considered “a bellwether of China’s drinks industry” and likely a strong reflection of the country’s enthusiasm for fine wine.
With any luck, this will be the year that sees this major player in the fine wine market return to form.

Chinese Wine Imports on the Road to Recovery

A number of key critics have delivered their thoughts on the third and final of the vintage triumvirate – Bordeaux 2020. The wines are characterized by lower alcohol levels, tension, and precision as a result of the warm and dry conditions with well-timed rainfall.
As the wines continue to become available in bottle, attentions have refocused on this vintage thanks to the unusual circumstances that surrounded it. With summer ripening and harvest taking place in the thick of the Covid-19 lockdown, restricted access to the estates meant that the growing season and processes took place relatively quietly and without the usual commentary. En primeur tastings were undertaken either remotely, or under tightly controlled conditions.
More recent tastings have revealed, however, that Bordeaux 2020 might be the champion of the three. Antonio Galloni concluded in his <a href="https://vinous.com/articles/bordeaux-2020-saving-the-best-for-last-feb-2023">report</a>, titled “Saving the Best for Last”, that “2020 is a great modern-day Bordeaux vintage. From the standpoint of both peaks and overall consistency, it surpasses 2018 and 2019.” Neal Martin notes in his <a href="https://v1.vinous.com/articles/thrice-is-nice-bordeaux-2020-in-bottle-feb-2023">report</a> that “Overall, the 2020 vintage delivers the goods. It seals the trio of great Bordeaux vintages, albeit sculpted in a modern style” referencing that of the three vintages that encountered warmer conditions “by 2020, they knew a hell of a lot more than in 2018”.
Both praised Pauillac’s Lafite Rothschild and <a href="https://winecap.com/news/2020-chateau-mouton-rothschild-label-unveiled">Mouton Rothschild</a>, as well as the “epic” Château Margaux, powerful Montrose, and Pétrus, which Neal Martin proclaimed “an absolute killer”.
Jane Anson was fortunate enough to be one of a handful of people able to experience en primeur in Bordeaux itself. In her Bordeaux 2020 vintage <a href="https://janeanson.com/2020-in-bottle-vintage-overview">overview</a> she mentions the significance of a more focused year. Where producers could be fully dedicated to winemaking alone, this “allowed estates to put the spotlight on their own processes, and perhaps question certain accepted practices, or double-down on others.”
Anson also notes that Bordeaux 2020 has seen only limited trading so far, but that it is likely to pick up the pace soon as more wines become available.
Bordeaux 2020 looks to be a vintage with a lot to offer, and potentially one of those rare occasions where the third in the series is considered the best. At WineCap, we see excellent performance potential here and will be in touch with new offers on this promising offering soon.

Bordeaux 2020 in Bottle

NFTs (Non-Fungible Tokens) and fine wine may seem like an unlikely pairing. After all, wine is one of the very oldest investments, while NFTs are among the newest digital advancements. The markets couldn’t be more different either. While 20-somethings snap up digital tokens in the metaverse, 60-somethings traditionally dominate the fine wine universe at auction houses. But it’s precisely this titanic clash of old and new which is firing up the market so vigorously.
Like a jolt of electricity, a surge of digital advancements is jump-starting the established wine industry … and it’s bringing floods of eager new buyers along with it.
<h2>Vineyards get a taste for blockchain</h2>
Over the past year, esteemed vineyards have started to sell NFTs with bottles attached to them. Just like a certificate or receipt of purchase, but far more secure. When the investor is ready, they will redeem the NFT for the physical bottle. In the meantime, it’s usually stored securely for them.
Since blockchain cannot be altered or tampered with, some wineries are using the technology to guarantee quality and combat fraud. In recent years, counterfeit bottles and scammers have plagued the industry, costing wine investors upwards of 2.7 billion euros a year<a href="#_ftn1" name="_ftnref1">[1]</a>. Using certified NFTs reassures buyers that the bottles they’re paying for are indeed the ones they’re getting.
Some vineyards, such as Màquina y Tabla, use this technology to sell wine en primeur<a href="#_ftn2" name="_ftnref2">[2]</a> &#8211; or as wine futures. The international nature of NFTs lends itself well to this. Within the blockchain, investors can check exactly what chemicals, conditions and processes were used to make the wine. They can closely scrutinize the sustainability levels too.
Some experts are even suggesting that the default currency of fine wine could soon become crypto as the pound continues to encounter volatility.
<h2>New investors enter the wine market</h2>
The emerging NFT space couldn’t be more different from the traditional wine market. At the time of writing, most NFT investors come from India, Vietnam, Hong Kong, Singapore, and Brazil<a href="#_ftn3" name="_ftnref3">[3]</a>. The age demographic is different too. Most NFT investors are between 18 and 34 years old.
While most NFT investors are true digital natives, they’ve also grown up in a snowball of recessions. This makes asset-backed digital investments like fine wine a welcome and intriguing option. Unlike most other NFTs, it’s something you can touch, with intrinsic value.
At the time of writing, this new breed of wine NFT investors seem keen, and they have money. Penfold’s 2021 NFT famously sold within just 12 seconds<a href="#_ftn4" name="_ftnref4">[4]</a>. And in summer 2022, an NFT linked to an exclusive champagne bottle went for an eyewatering $2.5 million<a href="#_ftn5" name="_ftnref5">[5]</a>.
<h2>Additional income streams will benefit vineyards</h2>
As well as the new clientele, there’s another compelling reason why vineyards may be keen to sell NFTs with bottles attached. Perhaps it’s the strongest incentive of them all. Each time the NFT is traded, the vineyard can opt to get a small cut of the price.
Over time, as the wine NFT changes wallets, these incremental profits can stack up.
Extra streams of passive income will surely be very welcome to vineyards, as <a href="https://winecap.com/news/heatwave-provokes-bordeaux-fires">the industry grapples with climate change and forest fires</a>. Producers can use the revenue to continue adapting, experimenting, or simply making up a cash shortfall – all of which is good news for wine investors.
Vineyards are keen to develop and invest in the NFT space. Some of the most famous wine families, including the houses of Rouzaud (Champagne Roederer and Château Pichon-Comtesse), Reybier (Saint-Estèphe’s Château Cos d’Estournel), Moueix (Videlot) and Perrin (Château de Beaucastel) poured a whopping 6 million euros into Winechain, a new wine NFT platform. It surely goes without saying that they’re likely looking for a return on their investments.
<h2>Vineyards can be more creative with NFTs</h2>
Trading NFTs online also gives vineyards a chance to include the kind of extras and luxuries that investors enjoy. There is almost unlimited room for creativity.
Château Angélus, for example, also include digital artwork and virtual wine-tasting sessions in the fine wine NFT package. The art appeals to NFT investors keen to build on their collection of unique digital assets. They can showcase these in their metaverse home or sell on to others. The wine tasting, of course, appeals to almost everyone.
New Zealand-based vineyard, Hello Fam, took things even further. This vineyard partnered with Graham Norton – voice of Eurovision and host of the One Show – to offer NFTs for their limited edition “HeDevil” wine. The NFT includes two bottles, physical artwork, and one lucky buyer got to attend a virtual tasting with Norton himself.
Unlike traditional bottles and barrels, vineyards can truly tailor wine investments and experiences around buyers. This opens the door to new potential, new markets, and new possibilities.
<h2>Investors should be wary of risks</h2>
While there is a world of possibility around these new digital advancements, there are drawbacks too.
The world of NFTs moves fast… a little too fast. With all the hype and possibilities around these digital advancements, it can be easy to get carried away. But – as always with investing – it’s important not to get swayed by the market noise.
As the oracle of Oklahoma, Warren Buffet, famously said, “The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd nor against the crowd”.
Before diving into the fast-paced world of NFT wines and metaverse investments, <a href="https://winecap.com/learn/6-questions-to-ask-yourself-before-investing-in-fine-wine">investors should consider their long-term strategy and conduct careful analysis</a>. Although vineyards create authentic NFTs, there are likely to be fakes around.
What’s more, NFTs are traded using cryptocurrency, so investors cannot buy and sell them with fiat money like pounds, euros, or dollars. This comes with its own set of headaches. Firstly, these digital coins are famously volatile. In March 2022 – an especially bad time – the value of Bitcoin fell by a colossal 60%<a href="#_ftn6" name="_ftnref6">[6]</a>. Over 2023, some experts are predicting a further 40% drop<a href="#_ftn7" name="_ftnref7">[7]</a>. The second largest cryptocurrency, Ethereum, has also been on a rollercoaster. In December 2021, a single coin was worth $4,624, fast-forward one year and it’s $1,296 – less than a third of the value<a href="#_ftn8" name="_ftnref8">[8]</a>.
The process of mining and trading cryptocurrencies – and by extension – NFTs is also reportedly detrimental to the environment. By contrast, <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment">fine wine investments are usually quite sustainable</a>, and so NFTs could undo many of those important benefits.
Another consideration consideration of digital advancements in the industry is that cryptocurrency has been banned in nine countries, including China. This means that the <a href="https://winecap.com/learn/opportunity-for-asian-and-american-investors">waves of Asian investors entering the wine market</a>, are probably coming through the traditional route.
<h2>The value of fine wine is likely to increase … But at what cost?</h2>
The new generation of buyers is likely to increase the market value of fine wine. As any economist will tell you, when demand outstrips supply, prices go up. It’s excellent news for today’s investors who may find that they can sell bottles for higher prices with greater liquidity.
However, investors who are looking to buy into NFT wines themselves should exercise caution. The space is still new and emerging, and regulations are being discussed as we write.
The environmental impact of NFTs and cryptocurrency on vineyards is already raising some eyebrows. Climate change <a href="https://winecap.com/learn/how-climate-change-affects-value-of-fine-wine">alters the value of fine wine more than almost any other factor</a>. While the marketplace welcomes new buyers and innovations, the integrity of fine wine must always come first.
<a href="https://winecap.com/wine-track">Find out more about the latest fine wine trends and prices.</a>
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<a href="#_ftnref1" name="_ftn1">[1]</a> Source: <a href="https://euipo.europa.eu/tunnel-web/secure/webdav/guest/document_library/observatory/docs/Full%20Report/Full%20Synthesis%20Report%20EN.pdf">EU IPO</a>
<a href="#_ftnref2" name="_ftn2">[2]</a> Source: <a href="https://cluboenologique.com/story/nfts-and-wine-whats-the-deal/">Club Enologique</a>
<a href="#_ftnref3" name="_ftn3">[3]</a> Source: <a href="https://www.finder.com/uk/nft-statistics">Finder</a>
<a href="#_ftnref4" name="_ftn4">[4]</a> Source: <a href="https://www.decanter.com/wine-news/penfolds-to-release-second-rare-wine-nft-472517/">Decanter</a>
<a href="#_ftnref5" name="_ftn5">[5]</a> Source: <a href="https://nftevening.com/bored-apes-nft-champagne-bottle-sells-for-record-2-5m/">NFT Evening</a>
<a href="#_ftnref6" name="_ftn6">[6]</a> Source: <a href="https://www.cnbc.com/2022/12/05/btc-bitcoin-could-fall-to-5000-standard-chartered-predicts.html#:~:text=Bitcoin%20has%20already%20fallen%20more,to%20spread%20through%20the%20market.">CNBC</a>
<a href="#_ftnref7" name="_ftn7">[7]</a> Source: <a href="https://www.cnbc.com/2022/12/01/bitcoin-price-could-fall-40percent-to-10000-in-2023-mark-mobius-says.html">CNBC</a>
<a href="#_ftnref8" name="_ftn8">[8]</a> Source: <a href="https://nz.finance.yahoo.com/quote/ETH-USD/history?period1=1438905600&amp;period2=1670976000&amp;interval=1mo&amp;filter=history&amp;frequency=1mo&amp;includeAdjustedClose=true">Yahoo Finance</a>
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Digital Advancements Bring a New Generation of Wine Investors

In his new <a href="https://vinous.com/articles/2019-barolo-back-on-track-jan-2023">report</a> reviewing 2019 Barolo releases, Antonio Galloni has showered this “stellar vintage” with praise, noting that even though the summer brought intense heat, opportune rain and instinctive decision-making on the winemakers’ part led to wines that “don’t taste like wines from a warm vintage at all.” Following an inconsistent 2018, this return to form might very well signal a new cycle of strong to exceptional vintages for this storied appellation.
Those who value Nebbiolo&#8217;s complexity and finesse will be enthralled by the 2019 Barolo wines and their powerful, tightly-wound structures, which currently have the sort of youthful austerity akin to vintages like 2016, 2005, and 1999.
A relatively dry winter and typically warmer-than-average temperatures marked the start of the year before colder conditions and rainfall saw bud break delayed by two weeks. Though persistent rain threatened a repeat of the previous year, thankfully it turned out to be quite benign. The summer months were met with warmer weather balanced with rainfall and cool nights which led up to an ideal, slightly later harvest.
Among the stars are Vietti, with Barolo Ravera earning 100 points from Galloni, citing its energy and tension as exciting characteristics. Giacomo Conterno’s Barolo Riserva Monfortino comes in just behind at 97-99 points showing incredible refinement for its relative youth, and showing plenty of tannin and structure. Also, following the sad passing of Luciano Sandrone, both Barolo Le Vigne and Aleste scored 97 points and were praised for their energy and potential development.
WineCap sees a real opportunity in Italy at the moment and the wines of Piedmont in general. Keep an eye out for offers coming over the next few weeks. Many of these wines are not available yet, but rest assured that when they are, we will be certain to let you know.
Read more about <a href="https://winecap.com/news/why-fine-wine-might-be-a-better-investment-than-you-thought">Why Fine Wine Might be a Better Investment Than You Thought</a>.

Antonio Galloni’s 2019 Barolo Report

Our Q4 report, analysing the trends that shaped the fine wine market over the past three months, <a href="https://wp.winecap.com/wp-content/uploads/2023/01/Q4-Report-2022.pdf" target="_blank" rel="noopener">is now available to download</a>. The report also provides a summary of the year in fine wine and a look ahead to 2023, accounting for the macroeconomic environment and core factors such as inflation, currency moves, new releases, supply, and levels of demand.
<h2>Fine wine shows remarkable resilience in 2022</h2>
The fine wine market remained bullish in the face of severe headwinds, which only started to impact its performance in the final quarter. 2022 brought a perfect storm of pandemic, war, inflation, climate change and unsteady politics, which led currencies, bonds and equities spiralling downwards. But fine wine did not experience any of the volatility that affected mainstream markets. Instead, all major fine wine indices finished the year with increases. Rare Burgundy and vintage Champagne enjoyed soaring demand and peaking prices.
<img loading="lazy" decoding="async" class="aligncenter wp-image-1265" src="https://wp.winecap.com/wp-content/uploads/2023/01/Liv-ex100vsmainstreamequities-375x224.png" alt="graph of liv-ex 100 performing well against mainstream equities" width="800" height="478" srcset="https://wp.winecap.com/wp-content/uploads/2023/01/Liv-ex100vsmainstreamequities-375x224.png 375w, https://wp.winecap.com/wp-content/uploads/2023/01/Liv-ex100vsmainstreamequities-768x459.png 768w, https://wp.winecap.com/wp-content/uploads/2023/01/Liv-ex100vsmainstreamequities.png 1030w" sizes="(max-width: 800px) 100vw, 800px" />
<h2>What to expect in 2023</h2>
If 2022 was all about Burgundy and Champagne, 2023 is likely to see the return of more subdued market players, which offer value and quality. Stability will be a key theme in the new year as the economic outlook remains uncertain.
Although fine wine might experience a temporary drift following its bull run, many wines continue to set trading records. Among them in Q4 were some of the critics’ ‘wines of the year’ such as Talbot 2019 and Lynch Bages 2014. Bordeaux remains the market’s driving force, with heightened demand across both ‘on’ and ‘off’ vintages. But demand is also getting broader, with more wines considered investment-worthy than at any other point in history, be it grower Champagne, the Rhône, Italy, California or further afield.
WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by fine wine. Download our brand new report below for your summary of the past quarter in fine wine.

Q4 2022 | Report

Investments in fine wine have <a href="https://winecap.com/news/increased-global-demand-for-fine-wines" target="_blank" rel="noopener">proved exceptionally popular over the recent years</a>, bringing in new buyers and record trades[1]. And it’s easy to see why! <a href="https://winecap.com/learn/seven-delicious-reasons-to-invest-in-fine-wine" target="_blank" rel="noopener">There are many advantages to investing in fine wine</a>, especially in the current high-inflation environment. However, before diving in, it’s important to take a step back and consider how fine wine could fit into your overall investment strategy.
Here are six questions to ask yourself before investing:
<h2>1. What is your investment goal?</h2>
Investment goals are unique to the investor. Some people dream of going on a lavish round-the-world trip, while others are simply looking to afford a comfortable retirement. Whatever your personal goal (or goals), take a moment to write it down.
Calculate how much your goal will cost and how much time you’ve got to get there. This forms the backbone of your investment strategy.
For example, if you’re hoping to put down a £150,000 deposit on a property in a decade, and you can afford to put aside £1,000 a month towards it, you will need to find the additional £30,000. This means your investment goal is to generate £30,000 over the next ten years. The way that you approach it depends on your unique time horizon and risk tolerance.
<h2>2. What is your time horizon?</h2>
The general rule is the more time you have, the more risk you can afford to take. Of course, there is always a chance with investing that you may get back less than you put in, but over longer periods this risk is mitigated.
Experts mostly agree that if you will need your money in less than five years &#8211; say one or two &#8211; it’s normally better to put it in a high-interest savings account. If you need it within the next five to ten years, a lower-risk and highly diversified portfolio could be the best option. Blue chip stocks, AAA graded bonds and market index funds could make up the bulk of your portfolio. If you have more than ten years to invest, you can probably afford to take more risk.
Pension fund managers normally follow this rule. Generally, young employees – who have multiple decades of work ahead – will be invested in high-risk illiquid assets. By contrast, those closer to retirement will be transitioned to low-risk, liquid investments.
Time is an important factor to consider as you begin to explore fine wines and consider how they could complement your strategy. As you research bottles, check that the maturity date matches your strategic timeline. Luckily, there are many different fine wines out there to suit different investors. You can <a href="https://winecap.com/wine-track" target="_blank" rel="noopener">effortlessly stay updated on the latest trends fine wine with Wine Track</a>.
<h2>3. How much tolerance do you have for risk?</h2>
Your investment risk tolerance is nothing to do with your normal risk appetite. It’s about how you feel when the markets are volatile. It’s about whether the idea of your investments soaring and plunging in value makes you excited or nauseous. You could be a sky-diving, base-jumping crocodile physiologist and still feel queasy at thought of market downturns.
Figuring out the level of risk you’re prepared to take with your wealth is a crucial part of designing your investment strategy. After all, you don’t want to lose sleep over your investments, they are there to help you dream – not give you nightmares!
Different asset classes can be broadly grouped into different risk levels. On the lower-risk side, there’s investments like gold, property, or fine wine. These tend to provide stable and steady returns over time. On the higher risk-side are assets like crypto assets, high yield bonds, derivatives, or equity in start-ups. These are more volatile in nature, often soaring and plummeting quickly.
In the current environment, <a href="https://winecap.com/learn/is-fine-wine-inflation-proof" target="_blank" rel="noopener">investors looking to mitigate their risk might be interested in inflation-shielding assets</a>. These are usually physical and tangible investments like property, art, gold, collectibles, and of course, fine wine.
<h2>4. How much liquidity do you need?</h2>
If things take a turn for the worse, how much money will you quickly need to access from your investment portfolio? Or in other words – how much liquidity do you need?
Ideally, investors should not liquidate their portfolio before the right time. Doing so could unbundle the entire investment strategy and mean missed opportunities later down the line. For this reason, experts recommend keeping three to six months’ worth of living costs aside in a high-interest savings account. And many will also advocate to have a healthy surplus in a current account too.
However, sometimes life happens, and investors have no choice but to liquidate. Think carefully about how much of your portfolio you would need to sell in an emergency and how quickly you’d need the cash. This is an important part of planning your strategy.
Some assets can be quickly converted into cash. For example, many of the blue-chip shares and funds – such as those on the FTSE100 or S&amp;P500 could usually sell within 24 hours. However other assets – especially those on the private market – can take several weeks, months or even years.
Generally, for fine wine it can take between weeks and months to sell bottles. But it depends on the time of year, type of bottle and asset maturity. With <a href="https://winecap.com/wine-track" target="_blank" rel="noopener">Wine Track, you can keep a close on the demand and prices of fine wine</a>, so that you’re always up-to-date.
<h2>5. How diversified are you? </h2>
Nobel-prize laureate Harry Markovitz famously revealed, “Diversification is the only free lunch in investing”. As you build your investment portfolio, it’s important to diversify your revenue streams. This can help to shield your overall wealth from market shocks and prevent one downturn from slashing the value across your entire investments.
<a href="https://winecap.com/learn/7-under-used-alternative-investments" target="_blank" rel="noopener">Alternative investments &#8211; such as art, antiques, commodities, and fine wine</a> – are often used to boost diversification and provide different sources of returns (hence the name).
Because assets like fine wine derive their value intrinsically, <a href="https://winecap.com/learn/3-rules-for-fine-wine-investors" target="_blank" rel="noopener">they are less affected by the market turbulence outside</a>. They are also traded away from the stock market. This provides a different source of revenue and helps to diversify portfolios.
As you build your overall portfolio, experts recommend aiming for a blend of different asset classes, sectors, and geographical locations. Reaching as far and wide as possible is one of the most effective ways to mitigate exposure to market shocks.
<h2>6. What’s your impact on the world?</h2>
One of the most profound questions for investors to ask themselves is what effect they’re having on the world around them. How their money is invested can make a dramatic difference on the planet.
Fortunately, many vineyards and fine wine investors care deeply about the environment. The <a href="https://winecap.com/learn/how-climate-change-affects-value-of-fine-wine" target="_blank" rel="noopener">quality of grapes is closely linked to the climate</a>, and many wineries are working hard to adapt and mitigate the effects of the crisis. As an investment that thrives on the prosperity of vines, <a href="https://winecap.com/learn/5-ways-fine-wine-investments-good-for-environment" target="_blank" rel="noopener">there’s a strong case to be made that fine wine is an ESG investment</a>.
As you build your portfolio, consider carefully what your wealth is being used for and whether you agree with it. Your choice of investment gives you power and influence, use it wisely.
<a href="https://winecap.com/learn/how-does-fine-wine-react-in-a-recession" target="_blank" rel="noopener">Discover more about how fine wine reacts in a recession</a>.
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[1] Source: <a href="https://www.liv-ex.com/2022/11/number-wines-traded-surpasses-2021-record/" target="_blank" rel="noopener">Liv-ex</a>

6 Questions to Ask Yourself Before Investing in Fine Wine

Fine wine and spirits sales at Sotheby’s hit a record-beating $150 million last year, an increase of 14% compared to the year before. 
69 wine and spirits auctions were held by the top auction house during 2022, which represents 30% more than in 2021. This new record for fine wine and spirits sold at auction doesn’t include private sales and retail sales.
The main revenue source was fine wine: delivering a total of $121 million last year. Spirits also contributed double-digit growth of 15% year-on-year with a total of $29 million, underlining the rising interest in investment-grade whiskies and fine spirits. 
One particular highlight included a unique assortment case of 12 bottles from the 1990 vintage of Domaine de la Romanée-Conti which sold for an estimate-breaking $118,750.
The Macallan The Reach 81 Years Old single malt, an incredibly rare special edition, went on auction in September at Sotheby’s in London. It was the oldest whisky ever to be entered into an auction and sold for £300,000 (or $325,740).
In the US, spirits sales doubled: up from $5 million to $12 million. The key driver can be attributed to a stronger demand for luxury bottles.
Asia remains a key focus for Sotheby’s, with the auction house’s 2023 continued expansion plans in the region. Sales in Asia contribute the most to the house’s total revenue from auctions: $54 million. What’s more, the auction house reported that Asian buyers represented 41% of sales by value in 2022.
Commenting on total sales, Yves de Launay, Head of Auction Sales, said: ‘Overall 2022 saw a very strong performance in a very challenging market.’ ‘Bordeaux and Burgundy clearly led the way with an increasing demand for vintage Champagne and rare wines for other regions such as Tuscany or Rhône. Demand should remain strong for the finest and rarest wines in 2023.’
Read about <a href="https://winecap.com/news/christies-london-auction-reaches-over-2-million" target="_blank" rel="noopener">Christie’s December 2022 London auction</a> that reached over £2.12 million in sales.

Sotheby’s Wine & Spirits Auction Sales Top Record $150 Million in ’22

François Pinault, owner of Artémis Domaines, has finalised the acquisition of Champagne Jacquesson.
In February last year, Artémis Domaines took control of a minority stake of 33% in Champagne Jacquesson. At the time there was speculation that a full takeover would ensue later in the year. Managing the Dizy-based operation with his brother Laurent since 1990, Jean-Hervé Chiquet has confirmed that the complete takeover happened in December 2022. Chiquet commented: ‘When we bought back Michael Mackenzie’s shares (in the company) at the end of 2020, we started to think about a new partner and found that Artémis Domaines was interested. We started to discuss options with them and agreed on their arrival as a minority shareholder last February.’
‘Since then, we have had time to get to know each other and, as Laurent and I have no successor in our family, we have decided to put Jacquesson in the best hands possible to guarantee its future and to be sure that our dedication to quality will remain or even be improved,’ Chiquet added. Although he and his brother won’t be actively involved in managing the company, ‘we will continue to supply the company with grapes from our own vineyards and I will stay on as a member of the board but without an operational role,’ Jean-Hervé added.
Located in Dizy outside of Epernay, the Jacquesson estate was purchased by Jean-Hervé and Laurent’s father in the 1970s. The estate dates back to the 18th century and Joseph Krug worked there before he founded his own house in 1843. The brothers have shaken up the ‘Brut sans année’ market with the introduction of their Cuvée 700 concept. Their first release – Cuvée 728 – centred on the 2000 harvest and was released in 2004.
Chiquet, who has previously spoken about his and his brother’s approach, said: ‘The Cuvée 700 concept is unique in Champagne and is the opposite of a non-vintage wine. We seek excellence rather than homogeneity, respect for the character of the vintage rather than its denial, and the preference to create a “house style”, the doctrine most other producers in Champagne follow for their non-vintage blends. Our Cuvée 700 is the only blended wine we produce; it is meant to be the expression of a year and thus each year offers a different identity which we recognise by numbering the cuvée.’
Read more about the <a href="https://winecap.com/news/pinault-familys-new-merger" target="_blank" rel="noopener">Pinault family’s 2022 acquisition of Champagne Henriot</a>.

Champagne Jacquesson Purchased by Pinault Family

For centuries, property has been hailed as the sturdiest of investments. After all, what could be more solid than bricks and mortar? But with the five or six figure price tags, near-constant renovation or service work and gut-wrenching taxes, is it really such a wise investment? In this article, we compare the performances, costs and returns of fine wine against property to see which one works out better for investors.
<h2>What returns could investors expect?</h2>
Investors in fine wine have reaped significant returns, especially over the past years. The Liv-ex Wine 1000, which tracks the overall performance of fine wines, shows how the asset has grown in value by 45% over the past five years alone[1] (at the time of writing). And since the index was created in 2004, fine wines have steadily risen to almost five times their original price. Over the past year, fine wine investors have enjoyed returns of 13.6% on average[2]. While past performance is no guarantee of future returns, fine wine has a strong track record of delivering smooth and stable value for investors.
Property market values are a little more complicated to measure, as they are influenced by politico-economic factors. For example, the 2020-2021 UK Stamp Duty cuts impacted price movements significantly. However, we can still compare returns.
Most real estate investors will opt for a Buy-to-Let property. Depending on the area they select, rental profits generally range from between 3% to 8% each year. 2022 research from Zoopla reveals that UK rental yields are the highest in East Ayshire, Scotland. Here, investors pick up average yields of 8.5%[3]. By contrast – and perhaps surprisingly – the location with the lowest rental yields is the London Borough of Kensington and Chelsea. Despite the average property values of £1.7 million, investors reap just 3.3% profits[4]. Even the highest yielding rental properties are not delivering the superior returns of fine wine.
Comparing like-for-like, the average rental yield for a UK property today is 4.7% annually[5]. By contrast, wine investors have enjoyed returns of 13.6% on average over the past year[6].
<h2>Costs associated with buying and selling</h2>
Unless you chose to buy into a fund, purchasing the investment-grade wine of your choice can take a little longer than trading stocks and shares on the public markets. However, <a href="https://winecap.com/start-investing" target="_blank" rel="noopener">reputable online services like WineCap</a> make the process simple and straightforward.
Signing up to the WineCap platform and linking your desired investment amount takes just a few moments. From there, investors can effortlessly view, track, and purchase the finest wines available. They can even benefit from state-of-the-art analysis tools, and experts are on hand to recommend the best brands. Selling wine with us is just as painless. We are extremely well positioned to trade wine, reaching keen audiences and investors across the globe. When investors sell fine wine, WineCap charges a brokerage fee of 10%.
Buying a property, on the other hand, is almost always a drawn-out and complicated procedure. Investors looking for a buy-to-let will need to visit multiple different properties and locations, requiring time and planning. They’ll also need to deal with estate agents, surveyors, conveyancers, lawyers, banks and possibly mortgage brokers, adding around £5,000 to the cost[7]. Plus, if tenants are already living in the property, it problematic for investors who want to renovate or increase rents.
Selling a property means going back through the same laborious process, especially if the new buyer is part of a chain. It also occurs additional costs such as estate agents fees, EPC energy certificates, conveyancing fees and removal services, adding around £6000 in total[8].
Buying and selling a property comes with a lot more hassle and fees than fine wine. When fine wine is sold using online services like WineCap, a one-off 10% brokerage charge applies. By contrast, when buying and selling a property, investors are inundated with charges and requirements, adding thousands to the bill. 
<h2>Inflation-hedging and interest factors</h2>
Fine wine is <a href="https://winecap.com/learn/is-fine-wine-inflation-proof" target="_blank" rel="noopener">famously inflation-resistant</a>. Over centuries it’s demonstrated that returns are not corelated to the wider financial markets, and over the last years it’s become even more stable than gold. As a scarce and depleting asset, fine wine investments are a promising hedge against inflation.
However, the same cannot be said for buy-to-let mortgages. Unless investors can purchase property outright, they are likely to get hit with annual interest rates of around 5%[9]. Considering that the average property in the UK comes to £296,000[10], mortgage holders will pay out £14,800 each year. What’s more, since 2017, buy-to-let tax relief has been gradually decreasing in the UK. As of 2022, it became zero. Property investors will be feeling the rising interest more than ever.
Inflation and interest rates are closely linked. When inflation rises too much, central banks will attempt to “cool” the economy by raising interest. At the moment, we are in a high inflation environment, and so interest rates are unlikely to drop back to pre-pandemic levels for the foreseeable future. This is bad news for landlords and property investors, but it doesn’t negatively impact fine wine holders.
When it comes to inflation-hedging and interest, fine wine investments have the edge over property. Unless the investor can pay for the entire estate without any mortgage, they will be hit with higher rates and less tax perks. 
<h2>Ongoing maintenance costs</h2>
Some investors already have a temperature-controlled cellar at home. But for those that don’t, there are storage facilities available. Ensuring that the bottles are stored in the right conditions is crucial for maintaining and increasing value.
While storage costs vary from place to place, it’s usually between £10 and £40 for a case of twelve for a year. Some facilities may include insurance, or investors may prefer to purchase it themselves. Investors may also wish to have the wine delivered to a new location, which adds to the overall cost.
If you would like to <a href="https://winecap.com/schedule-a-call" target="_blank" rel="noopener">talk to an expert about fine wine and the maintenance costs, we’d be happy to help</a>.
Investing in property also comes with maintenance charges, which are often far more troublesome and costly. The estate may need renovation, cleaning, plumbing work, building work, decorating and more. Those planning to rent out also need to stay on top of regulations, such as fire safety measures. Many investors will employ a property manager to ensure that day-to-day issues are dealt with quickly, which is a drain on profits.
In addition, properties such as flats often require quarterly service charges, to pay for the communal maintenance, cyclical charges (like repairs) and reserve funds. Most service charges are between £1,000 to £2,000 a year.
Both fine wine and property investments come with maintenance charges. However, the cost of storing, insuring, or transporting fine wine is usually much less than the costs associated with properties.
<h2>Tax considerations</h2>
One of the major advantages of fine wine investments is the generous tax status. Under the UK HMRC, fine wine usually falls under the category of “wasting chattel”. This means that since it needs to be consumed within the next 50 years, it is exempt from Capital Gains Tax (CPT). Investment-grade wine which valued at less than £6,000 is also usually free from CPT. You can read more about the <a href="https://winecap.com/learn/fine-wine-taxation-2022" target="_blank" rel="noopener">taxation rules of fine wine with our comprehensive guide</a>.
However, the same cannot be said for almost all property investments. Property investors in the UK must normally pay stamp duty, capital gains tax and income tax. Buy-to-let investors will need to pay more in stamp duty than other homebuyers, as they have an additional 3% surcharge. And foreign property investors may face yet more taxes from both their own state and the one they are buying in.
Depending on the type of service property investors want to offer renters, they may also take on the Council Tax as well.
Property investors will probably need to pay stamp duty, CPT and income tax. Meanwhile, nearly all fine wine investments are exempt.
<h2>Is fine wine the new property?</h2>
In the current environment, fine wine has many desirable qualities and benefits over traditional property investments. While wine does have some associated costs, they are usually much lower and more straightforward than buying property. And, unlike property investments, the returns on fine wine are not directly impacted by tax, interest rates or inflation.
Perhaps most importantly of all, <a href="https://winecap.com/learn/how-does-fine-wine-react-in-a-recession" target="_blank" rel="noopener">fine wine tends to preserve or increase in value during a recession</a>. It is not linked to the wider economy and government intervention in the same way that the housing market is. On the contrary, in the aftermath of the 2008 housing collapse, fine wine rallied[11].
So, is fine wine the new property? We think it’s better.
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[1] Source: <a href="https://login.liv-ex.com/login?state=hKFo2SBaZlV1Umtsa1hwekZ3dVJqQUEya3JIVUs0UGtWS2ZHWqFupWxvZ2luo3RpZNkgN2RobEEyOHJ3RjVxQlVGVEE2c3Z3d01oZGl1aXNjMTKjY2lk2SAzc2NZcHA4N3VNYlZLSHFrN0FvaHk1NG92ODA0WnBWNg&amp;client=3scYpp87uMbVKHqk7Aohy54ov804ZpV6&amp;protocol=oauth2&amp;response_type=token%20id_token&amp;scope=openid%20email%20profile&amp;audience=https%3A%2F%2Fliv-ex.eu.auth0.com%2Fapi%2Fv2%2F&amp;redirect_uri=https%3A%2F%2Fapp.liv-ex.com%2F%3Ftarget_url%3Dhttps%253A%252F%252Fapp.liv-ex.com%252F%2523%252Fanalysis-tool%252Findices-explorer%252FLX1000&amp;nonce=srgEhLSOlugcei7fQh~k9_SUfwulXq3D&amp;auth0Client=eyJuYW1lIjoiYXV0aDAuanMiLCJ2ZXJzaW9uIjoiOS4zLjAifQ%3D%3D" target="_blank" rel="noopener">Liv-ex</a>
[2] Source: <a href="https://login.liv-ex.com/login?state=hKFo2SBoajdUY1ZDRlhkUjJ6TlQxUk16TEZFZVB2VUM0ZHphY6FupWxvZ2luo3RpZNkgY2Y5ZEF2UzdPMEVGQ3dOSFpLNzZQbFRqSGQ4QXNETXCjY2lk2SAzc2NZcHA4N3VNYlZLSHFrN0FvaHk1NG92ODA0WnBWNg&amp;client=3scYpp87uMbVKHqk7Aohy54ov804ZpV6&amp;protocol=oauth2&amp;response_type=token%20id_token&amp;scope=openid%20email%20profile&amp;audience=https%3A%2F%2Fliv-ex.eu.auth0.com%2Fapi%2Fv2%2F&amp;redirect_uri=https%3A%2F%2Fapp.liv-ex.com%2F%3Ftarget_url%3Dhttps%253A%252F%252Fapp.liv-ex.com%252F%2523%252Fanalysis-tool%252Findices-explorer%252FLX1000&amp;nonce=D_QOwsrHXAaiXMlupcE08A5M~Z64ToeL&amp;auth0Client=eyJuYW1lIjoiYXV0aDAuanMiLCJ2ZXJzaW9uIjoiOS4zLjAifQ%3D%3D">Liv-ex</a>
[3] Source: <a href="https://www.zoopla.co.uk/discover/property-news/best-buy-to-let-locations/" target="_blank" rel="noopener">Zoopla</a>
[4] Source: <a href="https://www.zoopla.co.uk/discover/property-news/best-buy-to-let-locations/" target="_blank" rel="noopener">Zoopla</a>
[5] Source: <a href="https://joseph-mews.com/uk-property-investment/best-rental-yields-uk/#:~:text=What%20is%20the%20UK%20Average,of%20%C2%A31%2C064%20per%20month." target="_blank" rel="noopener">Joseph Mews</a>
[6] Source: <a href="https://login.liv-ex.com/login?state=hKFo2SBFSmhxaFZyb1RmY0tlZzhucjdYSVNQQVo4SWdlWGJtSqFupWxvZ2luo3RpZNkgMmxXSkFXODB5UXpWNXJBdllhTmtlMXVBMVptelUtdDSjY2lk2SAzc2NZcHA4N3VNYlZLSHFrN0FvaHk1NG92ODA0WnBWNg&amp;client=3scYpp87uMbVKHqk7Aohy54ov804ZpV6&amp;protocol=oauth2&amp;response_type=token%20id_token&amp;scope=openid%20email%20profile&amp;audience=https%3A%2F%2Fliv-ex.eu.auth0.com%2Fapi%2Fv2%2F&amp;redirect_uri=https%3A%2F%2Fapp.liv-ex.com%2F%3Ftarget_url%3Dhttps%253A%252F%252Fapp.liv-ex.com%252F%2523%252Fanalysis-tool%252Findices-explorer%252FLX1000&amp;nonce=n9D53JCf1tRrUfVJO0l3Lkbw6Pu13NNp&amp;auth0Client=eyJuYW1lIjoiYXV0aDAuanMiLCJ2ZXJzaW9uIjoiOS4zLjAifQ%3D%3D" target="_blank" rel="noopener">Liv-ex</a>
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[8] Source: <a href="https://hoa.org.uk/advice/guides-for-homeowners/i-am-selling/cost-selling-home/" target="_blank" rel="noopener">HOA</a>
[9] Source: <a href="https://www.moneysupermarket.com/mortgages/rates-table/buy-to-let/purchase/?propertyValue=160000&amp;mortgageAmount=111000&amp;remainingTerm=22&amp;repaymentMethod=InterestOnly&amp;sortState=MonthlyRepaymentAmount" target="_blank" rel="noopener">Money Supermarket</a>
[10] Source: <a href="https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/august2022#:~:text=Image%20.csv%20.xls-,The%20average%20UK%20house%20price%20was%20%C2%A3296%2C000%20in%20August,higher%20than%20in%20August%202021." target="_blank" rel="noopener">ONS</a>
[11] Source: <a href="https://login.liv-ex.com/login?state=hKFo2SB6ZG5ZQXBlQndwbXRmY240WVdvZ053ZUw1NlFIbWRDeqFupWxvZ2luo3RpZNkgdlRlaTFubXo5ZzJDU0hMSjFzSkZWaFkwdGNIQ3lWUHCjY2lk2SAzc2NZcHA4N3VNYlZLSHFrN0FvaHk1NG92ODA0WnBWNg&amp;client=3scYpp87uMbVKHqk7Aohy54ov804ZpV6&amp;protocol=oauth2&amp;response_type=token%20id_token&amp;scope=openid%20email%20profile&amp;audience=https%3A%2F%2Fliv-ex.eu.auth0.com%2Fapi%2Fv2%2F&amp;redirect_uri=https%3A%2F%2Fapp.liv-ex.com%2F%3Ftarget_url%3Dhttps%253A%252F%252Fapp.liv-ex.com%252F%2523%252Fanalysis-tool%252Findices-explorer%252FLX1000&amp;nonce=GnDumfi0.o50fYrjk-dyuZqepd0Hu6bf&amp;auth0Client=eyJuYW1lIjoiYXV0aDAuanMiLCJ2ZXJzaW9uIjoiOS4zLjAifQ%3D%3D" target="_blank" rel="noopener">Liv-ex</a>

Could Fine Wine be a Better Investment than Property?

While Chablis declared 2021 to be a ‘complicated’ year, 2022 has proven to be a real contrast, with the Chablis Commission having declared this year’s harvest to be a healthier and overall higher-yielding one.
Paul Espitalié – president of the Chablis Commission – commented that 2022 was a much more dynamic vintage when compared to 2021, as the years before it had ushered in ‘challenges for winemakers in Chablis with the changing and unpredictable climate’.
Many winegrowers in Chablis rejoiced after the harvest this year as yields were plentiful and almost up to the maximum amount permitted. Because of this, the commission is hopeful that the region will be able to make up some lost ground with regards to volumes for export markets, where the UK still holds the top spot.
Espitalié commented that: ‘The UK continues to be our most important export market and we believe a key element to the continuing success of Chablis wines’. He also added that one of the commission&#8217;s main focuses is to increase consumer awareness of both Petit Chablis and Chablis wines.
‘These appellations have just as much to offer the market, particularly in the current financial climate in terms of offering great value wines,’ he said.
The 2022 harvest’s wines will be available in the UK shortly. Over the course of a year, a total of 3.8 million bottles were sold in the UK in 2021 &#8211; 2022.
Looking ahead, 17% of all Chablis vineyards are currently 100% organic and the subregion is also on track to hit the Burgundy-wide target of becoming carbon neutral by 2035. The aim of these initiatives is to improve the vineyards’ health and protect the local industry for the years to come.
Read more about the potential of <a href="https://winecap.com/news/the-2022-burgundy-wines-real-potential" target="_blank" rel="noopener">Burgundy’s 2022 harvest here</a>.

Chablis Commission Pleased with 2022 Harvest

Our Insights from leading Bordeaux fine wine producers report is now available to download. This report is the result of 32 face-to-face interviews WineCap conducted in 2022 with some of Bordeaux’s leading châteaux owners, winemakers and senior representatives. 
While global stock and bond markets have had a turbulent year, the fine wine sector has continued to perform strongly. Thanks to its low correlation with mainstream asset classes and defensive characteristics, fine wine is attracting a wider investor audience.
WineCap recently undertook research among leading fine wine producers responsible for many of the highest quality vineyards in Bordeaux. We are delighted to share some key findings, which include, wine producers’ oldest vintage and favourite year, their views on new permitted grape varieties and how they are coping with challenges such as climate change.
Despite the perception that older vintages are more desirable, it’s fascinating to find that most leading Bordeaux producers prefer wines from the last decade. Find out which vintages they mention in particular in this report. 
While six new grape varieties are now permitted to be planted in Bordeaux, to help producers adapt to climate change, Cabernet Sauvignon remains the dominant grape variety, representing 32% of the total 1,668 hectares in the region. 
A key priority for the wine producers we interviewed is to maintain the same volume to all their existing customers, while attempting to supply as much as possible to new ones. While some producers have acquired adjacent land to expand production volumes to meet growing demand, volumes can vary dramatically depending on the quality of the harvest. Managing demand expectations is therefore a key challenge and calls for a flexible approach on the part of the customer.
Download our new report to discover key insights from one of the world’s top fine wine regions.

Insights from leading Bordeaux fine wine producers

Winemakers in Champagne have written an open letter – published in Le Monde on the 6th of December – that voiced their opposition to the professional bodies’ reneging on a commitment to phaze out the use of all chemical herbicides in the region by 2025.
The date was significant: it was the day of the Annual General Meeting of the Association Viticole Champenoise (AVC). At the AGM, both the Syndicat General des Vignerons (SGV) and the Union des Maisons de Champagne (UMC) had officially announced – five years previously – that herbicides would be banned.
Jean-Marie Barillère, former president of the UMC, commented in 2018: ‘There are only two possible outcomes: either we move forwards or we are forced to move, with all the risks the latter entails in ecological terms, in terms of image and therefore in economic terms for our industry and our businesses. I prefer to forge a path towards a virtuous Champagne, rather than keep dwelling on the past.’
Maxime Toubart, president of the Syndicat General des Vignerons, also said at the 2018 AGM: ‘Our objective is, in a few years&#8217; time, to be able to talk about a 100% sustainable Champagne, that takes its commitments seriously and can be held up as an example, and which can proudly proclaim: zero herbicides.’
Despite previous assurances, in 2022, Toubart refused to add the zero-herbicide policy to the cahier des charges: the Champagne appellation’s rulebook. Because of this, the dispute between the SGV, the Association Biologique Champenoise (ACB) and a union of organic growers, has only gained momentum.
President of the ACB, Jérôme Bourgeois, commented: ‘It is unacceptable that a prestigious appellation like Champagne can even imagine walking back a core environmental promise made five years ago, especially in today’s ecological climate.’
While the main Champagne body (the CIVC) didn’t comment on the open letter at the 2022 Annual General Meeting, David Châtillon – UMC president – did speak about the importance of preserving ‘Champagne&#8217;s perceived image’. Promisingly, he also made it clear that the Champagne region is committed to its zero-herbicide pledge, although no deadline was given.
In their address, Toubert added that ‘Champagne was greener than it ever had been before.’ This was supported by Arnaud Descotes, the CIVC&#8217;s technical director, who highlighted that the new herbicide law brought in last year has restricted the number of treatments permitted, as well as which herbicides are allowed.
Whether the initial deadline to rule out herbicides by 2025 will be met remains to be seen. However, one thing is for sure, those who signed the open letter are still keeping up the pressure: ‘We, Champagne winegrowers, Champagne houses and members of cooperatives, call upon the SGV and the UMC to continue implementing their progress strategy by respecting the deadline of &#8216;Zero Herbicides by 2025&#8217;, embracing an effective and sustainable commitment of our sector, in the interests of all stakeholders in the Champagne region and our fellow citizens.’
Read more recent Champagne news: <a href="https://winecap.com/news/moet-hennessys-champagne-stocks-running-low" target="_blank" rel="noopener">Moët Hennessy’s Champagne Stocks Running Low</a>.

Champagne Producers Fight Against Zero Herbicide U-Turn

Christie’s recent Finest and Rarest Wines &amp; Spirits sale that took place in London on the 1st and 2nd of December reached over £2.12 million at auction. Lots included anniversary collections from Champagne Philipponnat and California’s Ridge Vineyards, as well as six bottles of Pétrus 2000.
The top lot was made up of six bottles of Pétrus 2000 and fetched an impressive £30,000, which was the same value as 12 bottles of Le Pin 2018. Representing Burgundy, six magnums of Georges Roumier, Bonnes Mares 2005 went for £25,000.
Other notable wine highlights in the sale included some very special lots unearthed from King’s College Cambridge’s cellars: six bottles of Château Lafite-Rothschild 1959 that raised £20,000, 12 bottles of Taylor 1948 Port that went for £11,875 and six bottles of Croft 1945 that sold for £6,875.
The London sale celebrated Ridge Vineyards’ 60th anniversary. The collection comprised wines from each of its six decades and raised a total of £117,075. Mixed lots consisted of bottles, magnums and large formats of the leading Napa producer’s most exclusive wines, offered straight from its cellars. The star expression was undoubtedly nine magnums of Ridge Monte Bello that sold for £7,500.
Another key milestone the sale paid honour to was the 500th year anniversary since April de Philipponnat arrived in Champagne in 1522. The Champagne house presented 11 lots direct from its cellars and all of them sold, raising a total of £13,763. Particular highlights included three magnums of Clos des Goisses L.V. 1996.
A spokesperson from Christie’s commented that buyers from 22 countries, across five continents took part in the auction. Interestingly, millennial collectors were well represented, with 46% of new registrants being part of this demographic.
Read more about the recent <a href="https://winecap.com/news/hospices-de-beaune-2022" target="_blank" rel="noopener">Hospices de Beaune Burgundy auction here</a>.

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