We’re better educated than ever before when it comes to wine. Not only do we now realise that white goes with fish and red with meat (a lesson surely symbolising the transition from boy to man), but we can spot a bold red at 50 paces and don’t hesitate to splash out on a good Pouilly Fumé because, frankly, it’s the best. Where we may be lacking knowledge, however, is on the inherent value of wine – beyond the fact it tastes good and makes you happy. Gregory Swartberg, Managing Director of Cru Wine Investment, tells us that fine wine investment, like art, rare coins, stamps and classic cars, is a great alternative – and tangible – investment besides the more traditional ones in stocks, bonds, cash or real estate.
“It has proved very interesting, with an average annual 11% return on investment over the last 10 years”, Swartberg notes. “It’s outperforming most major indices, including both the FTSE 100 and Dow Jones, among others”.
The usual way to get involved is to approach a fine wine investment house who will help you put together and buy a portfolio that best matches your investment profile (based on risk, investment horizon and investment size). It’s a pretty clever move, financially-speaking: “During the investment period, the cases are typically kept-in-bond, which means that no VAT has to be paid while stored under these conditions, and it also optimises the value of the cases by keeping them under perfect conditions (something called ‘en provenance’ in the world of fine wine),” Swartberg explains. So, there’s no need to worry what to do with all those cases when you have decided you want to splash out…
Benefits of fine wine investment:
- No capital gain tax applied
- Hedge against other financial securities
- It’s fun
- Tangible asset that improves with age
- Wine knowledge
- One of the most liquid tangible alternative investments
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