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GROWTH RATE

Well, this is an interesting one.  There is no assured level of growth.

Since 1982 the Fine Wine Index has recorded 17% compound interest on average.

If you are buying En Premeur (wine futures) you will usually wait for 18 months before anything happens and the growth starts once the wine has been graded for the first time. As mentioned in other areas in this website, this form of wine investment is much riskier than investing in graded wines or wines with a set grading scope (92-96).

If you are buying back vintages (existing wine) it will start immediately and growth can double in a year (ask a professional/broker). It is important to remember that wines can go backwards and therefore you need to be aware of what future climates could affect within this market. As an example, the Lafite Rothschild 2005 (100 points) lost £2000 in value during the credit crunch. It is now advisable to buy this wine as you will gain an immediate increase when the economy improves. There are many examples of this and you need to explore them with your broker. My estimate for the top 10 Bordeauxís is between 15-30% a year at KEY TIMES, so make sure you have a broker who considers the contingencies.

Growth for New World is too varied across times in history since the 90ís to set an exact average and there is no index in this country. My rough estimate is that there are around 5-10 wines to pick for actual wine investment and they produce gains which would be too speculative to set at this stage. At certain times the market has produced very high growth such as post 9/11 when the markets collapsed. Ask a professional and check the data, but donít get involved in this area if you are a beginner!

   

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