Investment markets are at present fraught with the uncertainty of global political polarization and unrest. Fine Wine Offers an exciting, yet safe port in the storm. An asset class where investors can mix interest and intrigue with prudent financial action.
Investors seeking an asset that will provide defensive diversification and market-beating returns, typically mutually-exclusive, have found them both in fine wine investment. This realisation has led to a rapid increase in market participants, and the overall value invested.
With fine wine now better understood as an asset class, investors know it appeals to both the head and heart. You can own some of the most sought-after products in the world and enjoy the pleasures that come with it, safe in the knowledge that doing so has added financial stability to your wider investment plans, in a way unique within financial markets.
In theory, fine wine investment is underpinned by a simple supply demand imbalance. You purchase a truly exceptional case of wine, made in finite quantities. You professionally store the case while the rest of the production is consumed, which further exacerbates this supply demand imbalance. After several years, you then sell and enjoy the capital appreciation and tax exemptions from what has become a very rare and sought after wine. Whilst it must be remembered that fine wine is a financial market like any other, it is this simple premise that underpins the market.
At present, the fine wine investment sector has a range of propositions that either fail to understand fine wine as a financial market, or over- complicate it and distance the investor.
Bringing radical transparency to fine wine investment, BiBO’s investment proposition removes the complexities without compromising financial expertise. This means you can enjoy both the asset class, and passion for the product effortlessly.
What makes a wine truly exceptional?
Whilst over three billion cases of wine are produced each year, few qualify as fine wine and fewer still constitute investment grade wine.
Although dominated by French wine, where quality production levels far exceed other countries, investment grade wine is also evolving. Tuscany, Piedmont, and Napa have all emerged to challenge the historical dominance of France.
Wines from these regions that warrant consideration for investment sit at the very top echelon of quality. This 1% are produced within tight parameters and are subject to stringent regulation. These regulations differ region to region but their overarching purpose has always been to limit overexpansion and ensure a region’s reputation for excellence is maintained.
More recently this has been compounded by producers recognising the absolute value of true quality. With transparent critic assessment available to all, production must consistently achieve its best each year. Subsequently this pursuit of perfection has led to a production equilibrium to the benefit of both investor and end consumer.