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On Saturday June 9th the Financial Times printed their annual Wine Investment Report. This was pack full of interesting information. You can back order the relevant paper through FT customer service or if you are a subscriber enter ‘Wine Investment’ in the search line, you will see the 15 separate articles of the report layed out for you.
Obviously I’m not going to regurgitate the articles but here is an interesting round up of themes:
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Mahesh Kumar following up on his book clarifies that Investment Grade Wine is not correlated to the broader market, and since 1982 has averaged an annual 12%
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After the huge recent run up in prices are we experiencing a bubble? This discussion never produces an outright answer – just interesting for and against scenarios. Dan Gross the author of ‘Pop! Why Bubbles Are Great for the Economy’ also chimes in with an interesting twist.
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Confirmation that 2006 should not be an investable year, but a disclaimer is added that in this market anything will sell – a very dubious endorsement.
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Older wines going up in price, and more consistent prices for more recent vintages due to the transparency of the web.
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The US is more vibrant than the UK in its options for selling wine with more, newer auction houses (Acker, Zachys etc) and the online auction houses.
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Parker’s ratings are even more powerful than common knowledge. The price of wines go up exponentially from <94 -> 95 to 98 -> 99 to 100.
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Wine funds are focusing on institutional money not just individuals. This will move wine into a main-stream alternative investment vehicle.
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The Wine Investment Challenge. I will follow up on this in a future blog-post.
If you are at all interested in wine investment, you should try and get a back-copy of the FT’s Wine Investment Report. Although very English in its focus, and aimed at the very wealthy, it lays out the latest issues for wine investors.
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