Buying old wine bottles and selling them on a profit is turning out to be a good investment option. The investment is largely risk-free. The wine market has now grown into a $5 billion industry and is growing globally, which means it is future proof. Also, wines are an appreciating asset as their value grows with time.
Wine investors typically get 10-15 percent returns every year. However, rare bottles can get returns to the tune of 200 percent. The risk is non-existent and loss of money on the investment is rare as its value increases over time. The value of the wine is not linked to the stock market hence it is shock proof. For instance, in the 2008 recession in the United States, the S&P 500 fell 38.5 per cent, while the Liv-ex 1000 for wines fell only 0.6 percent. When the pandemic began in March 2020, the S&P 500 fell 25 per cent, while the Liv-ex 1000 exchange fell only 4 per cent, reported IANS.
What things one must keep in mind while investing in wine bottles?
An investor must do research as to which wine people are interested in. You need at least $10,000 to start investing in fine wine in the United States. Different kinds of wines must be invested into.
Wines can be auctioned or sold to private collectors. There are wine stock exchanges in some countries too. Finding the right platform is important.
There are many factors that increase the value of wine. The rarer your wine is, the more its value. The pedigree of the winemaker is also an important factor. Traditionally, people consider the Bordeaux region, Burgundy, Rhone Valley, and Tuscany in Italy as highly reputed winemakers.
With inputs from IANS