Wine Basics
Wine Investing
Apr 24, 2025
Investing in Fine Wine - An Introduction
Investing in Fine Wine: An Introduction, the Benefits, and the Issues
Introduction
Fine wine is a unique asset class for many reasons, and when approached correctly can yield attractive returns. However, knowing where to start is hard – there is a wealth of knowledge which remains inaccessible to most would-be investors.
The wine industry is very much an “old boy’s club” and the experience of investing in wine has often reflected that attitude.
It is no secret that wine investment is a specialist topic. Many investors who are otherwise knowledgeable about mainstream asset classes may know very little about wine. Unhelpfully, there is also a culture of “take our word for it” that permeates the wine investment landscape.
As a result, less knowledgeable investors sometimes end up with portfolios filled with wines that are unlikely to appreciate or for which there is no secondary market at all.
We are committed to making our analysis transparent, and providing investors with the tools to making an informed decision.
The Benefits
A unique supply/demand dynamic
The fine wine market is driven by supply and demand.
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.
Performance
Fine wine, especially on a regional level, compares favourably to mainstream equity indices even when factoring in dividend reinvestment.
The graph below compares the long term performance of various mainstream asset classes compared to a price-weighted index of ~8000 frequently traded fine wines.
The wine market downturn in late 2023 / early 2024 has led to blue chip assets trading well below their all time highs, providing an attractive opportunity for new investors looking to access the asset class.
Volatility
As well as the market’s favourable supply-demand dynamic, wine’s volatility profile stems from a lower liquidity. Whilst this can be a drawback, it does mean that the asset class is protected from panic selling in the event of a broader economic downturn.
As a result, wine exhibits favourable risk-adjusted returns compared to other asset classes. This is demonstrated by a higher Sharpe Ratio (shown above), which is a measure of the average return of an asset in excess of the risk-free rate and relative to its volatility.
Downside Protection
Source: The Liv-ex
As a tangible asset, wine behaves in a similar manner to gold as a “safe haven” asset. The below chart shows the Liv-ex 100 and Liv-ex 1000 vs. other asset classes.
Diversification
Fine wine shows little correlation to other asset classes, making it a useful portfolio diversifier.
The chart above shows the correlation between the Liv-ex 100 and 1000, regarded as the broadest measure of investment-grade wine, and various other indices and markets.
Another facet of fine wine vs. other commodities like oil or gold, is that regional indices perform very differently to one another. The graph below highlights the opportunity for further diversification within wine as an asset class on a regional basis.
Source: Liv-ex
Tax Advantages
It is often claimed that returns made from wine investments are exempt from Capital Gains Tax (CGT). The truth, as always, is more nuanced.
In many cases, wine is regarded by HMRC as a “wasting asset”. Wasting assets are regarded as those with a useful life of less than 50 years.
In these circumstances, no capital gains tax is payable. This carries through to assets held within a shared ownership structure.
Upon investing with WineFi, we will provide you with a Letter of Recommendation from a Specialist Tax Consultant.
When you invest in wine through WineFi, you are buying wine held “in bond”. Wines held in this manner are deemed not to have passed through customs, which means that VAT and Duty is suspended.
Unless these wines are removed from bond, no VAT or Duty are payable on your investment.
Interested in learning more? Click here to speak to one of our team, today.
The Issues
Illiquid
Wine is, ironically, an illiquid asset class. Whilst there are advantages to this (see “Volatility”), it means that wine is a long term investment.
Our relationship with Jera, a Coterie Holdings company, allows you to borrow against the value of your wine collection. This allows you to monetise an otherwise non-yielding portfolio, for the very first time.
We are currently exploring mechanisms that will allow our investors to trade in and out of the wine markets as easy as easily as placing a trade on Robin Hood or eToro.
Hold Period and Storage Costs
Fine Wine is a medium to long-term hold. We typically recommend a hold period of 3-7 years depending on market conditions. This extended timeframe allows for the wine to mature and potentially increase in value, while also providing a buffer against short-term market fluctuations.
It’s important to note that proper bonded storage during this period is crucial to maintain the wine’s quality and provenance. While fine wine can offer attractive returns, investors should be prepared for the costs associated with storage and insurance.
We include the cost of storage and insurance as part of our 10% up front fee, our partnership with Coterie Vaults allows us to pass on discounted storage costs to our customers.
Complex
It is no secret that wine investment is a specialist topic. Many investors who are otherwise knowledgeable about mainstream asset classes may know very little about wine.
As a result, less knowledgeable investors sometimes end up with portfolios filled with wines that are unlikely to appreciate or for which there is no secondary market at all.
Our job is to simplify the experience of investing in wine. We combine in depth data analysis with qualitative analysis from our Investment Committee, and make all research available to the customer, so they are able to make an informed decision.
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Wine Basics
Wine Investing
10 Aug 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
14 Jul 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
24 Apr 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
