Fine wine investment strategy is not restricted to en primeur purchasing; any modern fine wine portfolio should also expect to contain highly regarded ‘back’ [earlier] vintages. The selection of investment-grade back vintages increases the potential of the portfolio as a whole; particularly when one is able to take advantage of small market movements market to pick up temporarily undervalued wines.

Historically, fine wines have consistently been traded for profit at various points within their lifespan. These days more and more investors are choosing such alternative asset classes as an area of diversification; indeed, many investment ‘experts’ now view fine wine as an essential element of any growth portfolio.

So how and why may fine wines rise in value?

As a fine wine matures it generally increases in quality; this can be a contributing factor towards upward movement in price. However, of far more fundamental importance is the way in which pricing itself can be governed by the basic economic laws of supply and demand…