Interview with Drinks Business on the diversification benefits of wine investment

03-Dec-2015


Interview with Drinks Business on the diversification benefits of wine investment

While fine wine is regarded as strong in terms of historical returns compared to other investments, its diversification benefits are also being praised.

Cru Wine Investment, a London-based fine wine investment firm, has recently conducted research showing the benefits of mixing a wine investment portfolio with other equities, bonds, real estate and commodities.

Fine wine’s correlation with equities is low on both an annual and monthly level, according to Cru’s research using Liv-Ex figures.

“This proves to be one of the key financial attributes of fine wine: it’s very low correlation with equities albeit its high historical returns of 9% per annum”, the company said in a statement.

Oil and Real Estate are mildly correlated with fine wine, while gold has a higher correlation. Gold is also a tangible alternative product, which therefore gives it a higher correlation, Cru said.

See the table below:

Correlation table

 

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