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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15 Oct 2025
How To Spot a Wine Investment Scam
Written by Callum Woodcock, WineFi's CEO
In August 2025, three people were convicted of fraudulent trading relating to a complex wine fraud run by Imperial Wines and Spirits Merchants Ltd.
The scam involved extortionate mark-ups, sometimes as high as 400%, on what appear to have been legitimately investment-grade wines like Chateau Mouton-Rothschild. At the same time, the company falsely led prospective clients to believe that Imperial did not make any money at all until the wines were sold for a profit.
Whilst most clients did actually own the wines they were told they had purchased, a number of victims had no wine at all despite paying thousands of pounds.
What is most striking is that this company was in operation for a decade — from 2008 to 2018, when their offices were finally raided by Trading Standards.
Given the esoteric nature of fine wine as an asset class, most investors choose to invest through a dedicated company — be it a merchant or a specialist fine wine investment firm.
While there are many reputable operators, the unregulated status of the market inevitably attracts its share of bad actors — from deliberate fraudsters to the merely incompetent.
The good news is that it is surprisingly easy to distinguish credible operators from questionable ones — provided you know what to look for.
There are three key questions to ask when investing in wine.
1. Are you being ripped off?
Fine wine is unique amongst collectibles in that it has a third-party “list price”. These are not firm bids but asking prices — a lot like residential property. These prices serve as a yardstick for what the wines are worth at the time of purchase.
There are a number of publicly-available platforms that allow you to search for a wine based on producer and vintage — for example, Wine Searcher.
Filtering the location as the United Kingdom and only choosing wines that are “In Bond” should give you a more accurate picture. GBP prices are the de facto international reference given the UK is the largest global hub for fine wine trading.
You’ll quickly be able to get a sense of whether the price you are paying is fair or inflated.
The ease with which investors can validate this makes the Imperial Wines scam sadder, as it was entirely avoidable. They appear to have intentionally targeted "confused pensioners" who were less likely to be tech-savvy.
How WineFi Does It
So, what does "good" look like?
At WineFi, we show both the Liv-ex Market Price and the lowest Wine Searcher price on our platform to provide investors with an independent benchmark of what their portfolio is worth. We also compare our syndicate performance against market indices
We do this so investors never have to "take our word" for what their wines are worth, and can judge our benchmark our performance against the broader wine market.
2. Does your wine actually exist?
Given fine wine must be stored “in bond” (meaning in a government bonded warehouse to protect its resale value — more on why here) there is a third-party custodian that should be able to verify which wines are stored under your name, and whether they are ring-fenced.
You should be able to communicate directly with the warehouse (they are your wines, after all) rather than simply your broker in order to verify that your holdings are where you believe them to be.
One well-publicised whisky investment scam was exposed when a client began calling the warehouse where he casks were supposedly stored — only to find that they weren’t there.
How WineFi does it
At WineFi, we store wines with Coterie Vaults.
Fine wines held by both our syndicates and private clients are stored under the names of the individual owners, allowing our clients to independently verify their existence and ownership by contacting the warehouse.
They are ring-fenced from our own account to ensure that even in the event WineFi was to cease trading they remain the property of our underlying investors.
Is your wine actually worth anything?
This is a personal bête noire.
In recent years, we have seen a number of “investment” portfolios containing wines that have no secondary market price.
Given wine pays no yield, the only way to make money investing in this asset class is to eventually sell the wines on the secondary market.
If that secondary market does not exist, that particular wine has no resale value and therefore cannot be considered investment-grade.
Secondary market liquidity is therefore of critical importance when considering what to invest in.
This is where the water gets murky.
If you are looking to speculate on which producers are likely to break through in the future, you may be comfortable with this. However, these wines — by default — have no independent secondary market price.
Most investors are not looking to take moonshot punts on the next breakout producer, and yet we are regularly sent portfolios for review that are comprised of dozens of non investment-grade wines which still show a “market price” — which can only have come from the broker and is therefore unverifiable.
Until there is a trade on the secondary market, the value of that particular wine is zero.
How WineFi does it
At WineFi, secondary market liquidity and brand equity are two of the key factors that we examine when selecting portfolios.
We currently offer free portfolio reviews to those who have concerns about their holdings. To try and fight this issue at scale, we are developing a free application that will allow anyone to upload a CSV of their holdings and identify the investment-worthiness of their portfolios.
Conclusion
Fine wine can be both a compelling investment. However, as an unregulated asset class with significant information asymmetry between buyers and sellers, it can also create opportunities for misconduct.
While the market is becoming more professionalised and transparent, bad behaviour persists.
The best protection is to do your own research: check Trustpilot reviews for the company you are working with, and familiarise yourself with the best-practice principles outlined above.
If you’re already a wine investor and would like WineFi to review your portfolio — with no fee, no obligation, and no upsell — we’d be happy to take a look.
For more information, get in touch with our investment team.
Wine Investing
6 Oct 2025
WineFi Q3 2025 Quarterly Report
Introduction
We’re extremely excited to share our quarterly wine market report - delivering the most detailed view of the wine markets through Q3 2025.
This is a singularly important report, because this quarter we have seen strong signs of meaningful market stabilisation.
The WineFi Trade Price Index has increased in value for the first time since 2022, after almost 3 years of consecutive decline.
