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People with the correct connections have been investing in wine for centuries and if one were to look at the history it is one of the steadiest, low risk investments in the world, largely unaffected by stock market changes and also interest rates.
As is with any investment past performance is no guarantee of future behaviour. However, over the last 20 years the wine market has outperformed nearly all of the equity and fixed income indices including the FTSE 100. Wine is less volatile than stocks and shares and as such is a less risky investment.
For example £10,000 invested in Vintage wines over the last 33 years would have risen to £386,940 over the past 33 years. This goes to show that the recent extraordinary growth seen over the last 8 years is not distinct to the market, starting in 1987, the highest average annual return over a five-year rolling period achieved through an investment in the fine wine market has been 27 per cent, that is, between 1993-1997 an investment in the fine wine market would have yielded an average return of 27 per cent in each of the five years.”
This kind or return is extraordinary especially considering the low risk nature of investing wine. That considered specialised portfolios over the last 5 years have yielded on average around 25% per annum over the last five years.
Today Hong Kong's total business volume in trading, storage and auction of wine is approximately $514 million a year. In terms of volume, Hong Kong and China together command more than 60 percent of the Asian wine market with the Asian market making up 40% of the world. Therefore, today the clever wine brokers and Châteaux’s look toward this market and the caches and trends that it present. |
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