How fine wine can be a refuge for investors during and after Covid-19
Guest Post By Alti Wine Exchange
For those who are asking themselves who’s this, I’m Breno, lead copywriter at Alti Wine Exchange.
Last time, I was invited by Julien Miquel to give you some curiosities about wine history. Now, I’m happy to be here to speak about how fine and rare wines are an investment for the future. Thanks, Julien!
Let’s join together wine and finance tips, what do you think?
As a wine lover, rest assure: this passion can be financially very helpful for you.
You will be interested to see how and why fine wine investment can be the long-term safe haven you were looking for in your portfolio.
Real assets in times of crisis
What I want to show you today is that one of the best ways to protect yourself is to invest in real financial assets, which fall under the alternative investments category.
Especially in pandemic times, the worldwide coronavirus/covid-19 financial crisis is making investors’ lives hard. Uncertainty, heavy losses and more fears keep piling up.
In a scenario of economic uncertainty, many people like to go for physical, tangible assets: some buy real estate, gold, or art.
Fine wine is among the real assets and safe alternative investments you had been looking for.
What about earning much more in the long term?
Well, you who are a connoisseur or just a wine lover already know that rare and fine wines – the ones that age finely and become better as time goes by – tend to be sold for multiple times its original price years later, if well stored.
For instance? Think of those extremely expensive Romanée-Conti bottles that are auctioned for so many thousands of dollars and euros, every now and then.
An age-worthy wine that only tastes better with time would appreciate in price exclusively for its rising quality.
But there’s more: while the number of bottles of a certain vintage only decreases throughout the years (simply because these are consumer products), the demand for these wines is steady or even on the rise.
What that means? Simple supply-and-demand: safe, great returns.
The value of your fine wine will only rise with time.
There’s also another very good point: fine wine is largely safe from economic crises and downturns along the way because it’s not correlated to financial markets, shares and bonds.
But even if you want a comparison with the markets let me give you an example just for the short term. Compare the performance of our fine wine indexes versus two key European stock indexes. Not bad!
One very important fact I should state, however: you shouldn’t commit more than 3 to 5% of your portfolio to this investment class. It’s crucial that you maintain diversification, always.
Getting better, rarer and more profitable
The fine and rare wine you find on Alti Wine Exchange is limited in supply, and although it pays no interest, it becomes better (due to its quality) and rarer (because it is a consumer product!) as time goes by.
Acclaimed fine and rare wines like the ones we offer, from beautiful Bordeaux and Rhône to Brunello, Mosel Riesling and more, are fully sold out or becoming rarer in the retail market. When you buy one of them, potential customers in the future will look for them at Alti Wine Exchange, paying substantially more for these bottles – that you will be owning and, if you wish, storing under extremely safe conditions in a partner bonded warehouse.
But even if you don’t want to keep your bottle(s) in bond anymore, you will have a vintage that will stand the test of time if stored it under the right conditions. It’s a win-win situation for you!
Fine wine investment is becoming an important trend, and we’re happy to be a leading force there. We are the world’s first blockchain-based platform for wine exchange, working every day to make wine trading simple and convenient for everyone.
Still not sure about how we work? Check our FAQ!