Fine Wine as an Alternative Investment – Beware!

Successful investors understand that they need to seek out top quality, professionally stored examples of the most desirable wines available – at competitive prices – if they are to maximize potential returns.  Fixed supply, coupled with increasing demand ensures that the very best examples of these can command the greatest potential profit for serious investors once sold on.

You might be asking yourself what attracts so many savvy investors to fine wine as an alternative investment?  Past years have shown that first-growths have been known to appreciate by as much as 15% annually. This is sometimes enough to convince people that fine wine is a tangible, viable alternative investment.  And we mustn’t forget that with the recent surge in Chinese interest in the fine wine market there is added potential (global economic conditions notwithstanding) for many more years of strong appreciation rates.

However, for those who are new to the world of fine wine investment, there is no greater disappointment than to learn that you have invested in a clever wine scam.  To begin with, apparently nearly 5 percent of the world’s wine is counterfeit and is simply new wine in an old bottle. Perhaps more of a serious problem is the prevalence of purported “investment” companies who purchase no wine for their clients and then disappear, never to be seen again – or even worse still, similar companies who claim to look after “investment” clients’ best interests, yet overcharge massively – such a prima facie failing is unfortunately all too apparent in the UK.

If you are considering an investment in fine wine, key factors to consider (amongst many others) are that you purchase only the very best examples of investment-calibre wines, at fair prices, through a reputable organization – if it feels “wrong” somehow, it probably is; and in doing so ensuring the provenance of the wines. Once bought, storage should be done only in a professionally managed facility, ensuring the stability of the product (it requires the proper temperature in a humidity controlled environment to be maintained. Such protections are the only ways to ensure that you maintain the potential for return when you decide to sell.


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