Wine Investing Birmingham

What is Wine Investing?

Wine investing is exactly what it sounds like, it’s investing in wine. But, the finer details of this type of investing and what it entails can be a bit more complicated. Interested in wine investment Birmingham? Investing in wine involves buying bottles of wine that have the potential to gain in value over time.

The fine wine market focuses on vintages that show investment potential, which means it is considered long-lasting, rare, and in-demand. You’re not going to be a successful wine investor if you head down to the local grocery store and purchase a few bottles of mass-produced wine for £7!

In the past, vintages produced in the regions of Bordeaux and Burgundy in France dominated the fine wine investing market. However, today, it is also worth investing in wines from all over the world.

In fact, according to Liv-Ex (London International Vintners Exchange), in the last five years, wines produced in Italy and the United States have become some of the most popular investment wines, with many regions producing investment-grade wine with the potential to increase in value over time.

Investing in Fine Wine to Diversify and De-Risk Your Portfolio

Birmingham fine wine investments are attractive to those who feel that the Birmingham wine market offers a promising future. Younger and younger investors are looking to wine investing as a way to diversify their portfolio – the average buyer at a wine auction is currently in their 40s (previously, the average age was around 60). More people are interested in buying and drinking fine wine, which could offer opportunities for those looking to make money off a growing market.

Additionally, wine investing and finding the best wine investments can be attractive to someone who simply loves wine and wants to add it to their investment portfolio as an alternative asset.

It’s important to note that, in many cases, wine is considered a long-term investment and lacks the liquidity of other investments that can quickly be turned back into cash. You can expect to hold your Birmingham wine investments for at least three years before you begin to see better results.

Wine investing offers profitable potential returns – over the last 15 years, wine has offered annualized returns of 13.6%. Birmingham wine investing is considered less volatile than real estate investing.

The quality and scarcity of fine wine appreciates over time – and so does its value. This is the underlying principle of investing in wine.

You buy bottles of wine, and store them to sell them at a higher price later on.

Even though you physically own the bottles of wine you bought it is recommended that you store them professionally in specialised facilities until you sell them. This way your valuable wines are safe and in perfect condition until you wish to turn a profit. As a wine investment company, we will buy, store and sell your wines for you, without you having to take on any of the headaches of having to build your own wine cellar.

A Simple Example

10,000 cases produced
Wine matures with age and quality improves
Wine is consumed and reduces the supply
Remaining cases become more valuable

Investing in fine wine is both enjoyable and very rewarding, providing the opportunity to explore, understand and own some of the finest luxury products in the world. Fine wine’s historical performance has led many investors to view it as a tangible, alternative asset that can be used to diversify an investment portfolio, delivering stability and growth that can de-risk an investment strategy and protect wealth.

How to Start Investing in Fine Wine

If you are new to investing in fine wine, you should ideally seek the support and advice of a fine wine expert to ensure your wine investment goals are understood and fulfilled. They will help you understand the general market dynamics, select wines to create a rewarding portfolio in line with your investment goals and capital available, organise the necessary storage and insurance, provide ongoing performance information, and ultimately help you sell your wine at the optimum market price in time. To get started, you need to make some key decisions:

How much capital do you wish to invest in fine wine?

You may adjust this over time, but have a clear figure in mind to start with. Fine wines vary in price but an initial investment could be in the region of £2,000 – £10,000 and investors can create portfolios over time valued at six figure sums.

How long do you aim to hold your investment for?

You may adjust this over time, but have a clear figure in mind to start with. Fine wines vary in price but an initial investment could be in the region of £2,000 – £10,000 and investors can create portfolios over time valued at six figure sums.

What are your Birmingham wine investment goals?

Discuss these with your fine wine expert as this will affect the choice of wines to be included in your portfolio.

Confirm the selection of your investment wines.

Having agreed your budget and investment goals, you may also have an interest in wines from a specific region and your fine wine expert will guide you to acquire wines with excellent provenance that offer the best possible returns over time.

Wine Investing Birmingham
Wine Investing Birmingham

Benefits of Wine Investing Birmingham

Tangible Asset

Fine wine has an inherent, physical value, unlike stocks and shares. The value of fine wines increased by 13 per cent in the year to the end of June, in contrast to art sales, which slumped as auction houses remained closed.

Research by Wine Owners, an analytics company, commissioned by the estate agency Knight Frank, showed wine had experienced a sudden appreciation in value during the pandemic.

Sales of Bordeaux, particularly vintages from 1996 and 2000, had rocketed because they could be consumed on the spot or collected and stored by affluent drinkers.