Wine investment is a compelling investment case that runs on high demand low supply ratio, thus giving way to price rise and allowing investors a window of opportunity to reap financial profits. The world is drinking more good quality wine. In principle, the demand is increasing with a cap on quality producers. The world’s top producers are not only being asked to fulfil existing demand from Europe and North America but also the BRICK nations including Brazil, Russia, India and China. Expected demand from these nations is steadily rising which is bound to create pressure on prices - likely to go up in the coming years. 

 

Investment grade wines as an asset class represent a perfect inverse supply curve. Scarcity is a key factor affecting price.

 

Wine has also been a useful tool for portfolio diversification with a history of high returns, low volatility and negligible correlation to mainstream assets. Liv-ex 100 Index (the industry’s leading benchmark) , for example, which tracks the price of notable Fine Wines by and large has achieved a compound annual return of 13% since 1988 – better than Equities, Gold and Property. Over the last 20 years, there have not been 5 year periods where Fine Wine yielded negative returns.

 

Research shows that the value of wines have increased by an average of 12% per year for the last 50 years, with the smallest increase in value during the first few years of holding and most dramatic increase at the end of the hold term.

 

Our Liquid Asset Management division’s focus is to reach out to those entities/individuals looking to invest in this area and to maximise return on investments by guiding them systematically, periodically with complete transparency.