An expert in the fine wine market has suggested that an increasing number of people are looking at it as a “mainstream asset” that is well worth investing in.
Speaking in an interview with the International Business Times, Peter Shakeshaft, chairman of Vin-X and the Wine Investment Association, said: “I think the Knight Frank Report and the Barclays Wealth Report have both shown there has been a significant increase in high net worth individuals investing in fine wine as an asset class.”
Wine as an appreciating asset
Although it is impossible to predict what will happen to any investment with 100 per cent certainty, Berry Brothers point to an “increased interest in Bordeaux from 1996, 2000, and 2005, where the potential for growth appears strongest over the medium term”.
James Saft, a columnist for Reuters, wrote an article in which he suggested that silver, wine, art and gold – collectively referred to as SWAG – could provide the answer for investors who need to secure their money.
Because it is a tangible asset, he suggests it could be the solution to arm investors against “a grim decade of money printing and financial repression”.
Where are the emerging markets in terms of fine wine?
In 2008, interest in fine wine exploded in Asia, thanks in no small part to the abolition of import tax in China. While there have been some suggestions recently that the market may be cooling, there are other countries keen to invest.
Mr Shakeshaft singled out Russia as an emerging market that is “really starting to take an interest [in fine wine]“, and noted that the company is “already well-established within Moscow”.
Kazakhstan is another growth area, and India is no doubt one to watch because of the imminent drop in import tax.
“A lot of people are more secure about investing in wine as an asset,” he said.
Investors have also been enticed since interest rates dropped, which has resulted in very poor returns for anyone who insists on sticking their money in the bank.