You don’t need to be Alex Ferguson to work out that investing in wine is a serious proposition. Fine wine is a tradeable asset in relatively finite supply and one that isn’t subject to capital gains tax.
In English: investing in wine is a smart move, with the returns much easier to predict than many other investments.
Unfortunately, it’s not just a case of buying a case and shoving it in the box room for the next 5 years.
Once you’ve invested some of your hard-earned cash into a few decent bottles, your wine will require some TLC before it surrenders its complex flavours and, more importantly – that nice little bit of capital growth.
To ensure maximum profit, Chris Orr, wine guru for London Wine Week, takes you through the starting points in developing your own fine wine collection, from which wines to pick up, to how to store them.
1 | Do your research. Pick a wine that is likely to increase in value – not just a wine that you personally enjoy drinking. Speak to your local independent merchant who is likely to be knowledgeable about what might be a good investment.
2 | Whether you plan to sell it on or not, storing your wine safely and correctly is the only option to protect your investment.
A consistent temperature of around 13˚C is ideal for wine, so forget the spare bedroom. You also need a good amount of humidity to stop the corks drying out and compromising the seal. 80% is ideal, whereas standard humidity in a London home is around 45-55%.
3 | If you want to sell on your wine as a serious investment, then provenance - in other words the ability to prove where you wine has come from and most importantly the conditions in which it has been stored over the period of time you’ve owned it – is essential.
4 | Point 2 and 3 mean that the only option if you’re serious about your wine is to use a specialised storage facility, such as Octavian Wine Vaults, with climate control, full insurance, 24-hour security, and the necessary tools to help you prove and authenticate your wine’s provenance.
It’s an additional cost, but one that’s a fraction of the wine’s value, and moreover, it ensures your wine maintains its value. After all, you won’t be able to resell a case of semi-evaporated wine from the cellar-cum-box room at anywhere near its full potential value.
5 | The most important rule: Refrain from expensive dinner party raids on your most treasured wines that aren’t ready to drink yet – a mistake that has led many a wine collector towards a far worse headache the morning after than they (or their bank manager) ever anticipated.