6 Reasons to invest in Fine Wine

Wine Outperforming Financial Markets

In 2022, the Liv-ex 100 and 1000 significantly outperformed other financial indices, including gold.

Graph Showing Liv Ex data of investment wine vs financial markets

Perfect Inverse Supply Curve

Wine is a unique asset class in that there is a finite and diminishing supply which is set against ever increasing demand, particularly as certain sought after vintages are consumed and therefore become even rarer. Wine is also unique in that it improves as it ages, meaning that it is most desirable when it is most scarce – the ideal asset!

TOP-PERFORMING ASSET CLASS

Fine Wine was recently ranked second out of eleven key appreciating asset classes in the 2023 Knight Frank Luxury Investment Index, over a ten year  period. Chosen diligently, aportfolio of wine can be relatively liquid compared to some asset classes.

Art once agian tops the knight frank luxury investment indext (KFLII) but growth is starting to slow or even reverse for some of the other asset classes tracked by indext. Inflation busters wine watches jewlery coins art colour diamonds cars funiture rare whiskey bottles

Increasing Worldwide Demand

A general worldwide demand for Fine Wine has been augmented by booming demand from emerging wine markets, like China, India, the rest of Asia, and South America.Winemakers are limited in how much more wine they can produce, so demand will continue to drive up the price of Fine Wine.

The benefits of a physical asset

As a physical asset, Fine Wine offers a hedge against inflation, insurance against a market downturn, low correlation to other asset classes, low volatility over the long term, and asset & portfolio diversification.

Tax efficient form of investing

Because of its status as a wasting asset, Fine Wine has a special tax status and thus is exempt from several types of capital taxation, including Capital Gains Tax. Investors should seek their own tax advice.