Wine Basics
Wine Investing
Apr 24, 2025
Fine Wine - Liquid Gold
For those unfamiliar with the concept, it may come as a surprise to learn that people have been investing in fine wine for hundreds of years.
As early as 1787, American statesman Thomas Jefferson noted in his diary that a premium was being charged for Bordeaux wines from the more mature 1783 vintage versus the more recent 1786.
The lesson here – that fine wine improves with age, and will therefore be worth more in the future than it is today – remains the cornerstone of wine investing.
Since Jefferson’s time, investing in wine has become an increasingly mainstream pursuit for investors seeking uncorrelated, attractive risk-adjusted returns.
This trend shows no sign of slowing, with HSBC reporting in 2023 that 96% of UK wealth managers expect allocations to fine wine to increase.
Liquid Gold
When compared to other collectables, fine wine has two unique characteristics that make it stand out.
Firstly, unlike other collectables, there exists an objective, third-party price readily available through platforms such as Liv-ex.
Not only does this allow investors to ensure they are receiving a fair price, but it also allows for extensive quantitative analysis and modelling by professional wine investment businesses like WineFi.
This is in stark contrast to more opaque markets like art, whisky or classic cars, where investors are – to a greater or lesser extent – at the mercy of their broker’s valuation.
Secondly, wine’s status as a consumable ensures the existence of a unique supply-demand dynamic. There are a limited number of “blue chip” producers across a handful of top wine regions.
Only a finite number of bottles can be produced by each winery every year, the quality of which varies from vintage to vintage.
As the wines improve with age and bottles are consumed or damaged, they become
increasingly scarce. At the same time, as global wealth increases, so too does demand
for high-end wine.
This combination of ever increasing scarcity and growing demand helps to drive prices higher.
By The Numbers
Looking at the data, growing enthusiasm amongst wealth managers for investment-grade wine as a part of a broader portfolio is understandable.
Since 2004, the Liv-ex 1000 – the broadest measure of the investment-grade wine market – has returned 300%, delivering equity-like returns with a fraction of the volatility.
On a risk-adjusted returns basis, fine wine also compares favourably to more established asset classes. This is demonstrated by a higher Sharpe Ratio (shown below), which is a measure of the
average return of an asset in excess of the risk-free rate and relative to its volatility.
This characteristic stems both from fine wine’s favourable supply-demand dynamic, and the fact that it is – ironically – an illiquid asset. This means that it can take considerably longer to sell down a wine portfolio than, say, an equity portfolio.
Whilst this latter point can be a drawback if investors need to release cash quickly, it does mean that the asset class is protected from panic selling in the event of a broader economic downturn.
This is reflected in fine wine’s volatility profile, even during periods of market turbulence as was the case in 2023/24.
Uncorrelated Returns
Perhaps most fascinating, fine wine is uncorrelated to the performance of traditional asset classes, making it an attractive diversifier within a wider portfolio.
The correlation matrix below shows that wine shows almost no correlation to mainstream equity indices, bonds, commodities or gold.
Tax Treatment
A final consideration for investors is that, in many circumstances, returns from fine wine are exempt from Capital Gains Tax (CGT) in certain jurisdictions, including the UK.
Investors should be careful to do their own research to understand the tax treatment of fine wine in their locality.
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Wine Basics
Wine Investing
Aug 10, 2025
When is the Best Time to Invest in Fine Wine?
The fine wine market has always been a blend of passion and performance. For some, the allure lies in the artistry of the vineyard; for others, it’s the steady, tangible returns that make fine wine a compelling alternative asset.
But here’s the perennial question for investors: when is the right time to invest?
In our latest analysis at WineFi, we examined one of the most sought-after segments of the market—red Burgundy—to see how timing influences returns. We compared all red Burgundy wines in our investment universe to the Liv-ex Burgundy 150 index, the sector’s benchmark, and looked for patterns that could guide smarter entry and exit strategies.
The Findings at a Glance
Our data paints a clear picture of how red Burgundy performs at different stages of its lifecycle:
🚫 Don’t buy on release – On average, red Burgundy underperforms its benchmark in the first few years after release. That means paying top prices straight out of the gate often isn’t the best move for returns-focused investors.
🎯 Sweet spot: Year 6 – Performance begins to accelerate around the sixth year—coinciding with the median start of the wine’s drinking window. From here, returns tend to outpace the benchmark.
📈 Outperformance window: Years 6–25 – During this period, red Burgundy has historically delivered impressive relative gains. By year 25, the mean return in our dataset was 1.8x higher than the benchmark.
⚠️ After year 25: A trickier game – Performance tends to plateau, and volatility increases. As bottles become rarer and more valuable, prices can swing sharply in either direction. This aligns with the median end of red Burgundy’s drinking window, when investment and consumption dynamics shift.
Why This Matters for Investors
Fine wine, unlike many asset classes, is both finite and consumable. Every bottle opened reduces supply, creating scarcity—but also introducing unpredictability as remaining stock becomes fragmented across cellars worldwide.
By aligning purchases with a wine’s drinking window, investors can:
Maximise potential upside by entering when market demand is strengthening.
Reduce downside risk by avoiding the softer performance often seen in the early years.
Plan exits strategically before volatility overtakes predictable growth.
The Limits (and Power) of the Data
While this study looks at the mean performance of all red Burgundy wines in our universe, individual results will vary significantly by producer, vintage, and even format (bottle size). Legendary producers like Domaine de la Romanée-Conti may defy these trends altogether, while lesser-known estates might follow them more closely.
Still, using drinking windows as a timing tool offers a practical framework for making better-informed decisions—especially for investors building diversified portfolios across regions and styles.
Final Pour
The data tells us that patience pays in fine wine investment—particularly in Burgundy. If you can resist the urge to buy on release and instead enter around year six, history suggests you’ll be swimming with the current rather than against it.
In fine wine, as in life, timing is everything. And for Burgundy lovers, that sixth-year mark might just be the moment when the stars—and the corks—align.
Wine Basics
Wine Investing
Jul 14, 2025
WineFi Q2 2025 Quarterly Report
In Q2 2025, we have seen a stabilisation in wine market prices. In this quarterly report we dive into this finding to understand how list prices compare to trade prices, along with macro-analysis and regional comparisons.
In this edition, we explore:
🏦 Macroeconomic Analysis and the Effect on Wine Markets
📈 How Wine Compares to Other Assets
⚖️ Wine Market Stabilisation?
🔀 List Prices vs Trade Prices
🌍 Regional Performance Breakdown
Wine Basics
Wine Investing
Apr 24, 2025
WineFi Q1 2025 Quarterly Report
We’re pleased to share our Q1 2025 Quarterly Report, offering a concise, data-driven overview of fine wine’s performance in the first quarter of the year. As macroeconomic pressures persist and traditional markets continue to fluctuate, fine wine’s role as an alternative asset class remains in sharp focus.
In this edition, we explore:
🏦 Macroeconomic Analysis and the Effect on Wine Markets
📈 How Wine Compares to Other Assets
⚖️ Wine Market Stabilisation?
🌍 Regional Performance Breakdown
