Industry Accredited Fine Wine Report
Intelligent Partnership (IP), the UK’s leading provider of research and education on alternative investments, has published the first industry report focused purely on fine wine as an asset class. This independent report is sponsored by Cult Wines, a specialist in the acquisition, management, valuation and liquidation of wine investment portfolios.
Cult Wines commissioned the in depth 30 page Report to educate investors and advisers about this asset class, and identify the growth markets for fine wine.
The Report reveals that strict limitations on supply and rising demand from wealthy buyers in China and India has increased the popularity of fine wine as a wealth store – providing a hedge against inflation, protection against low interest rates and currency fluctuations. The Report highlights research from Morgan Stanley on the mass international wine market which concludes that a worldwide shortage of wine is imminent, with current global demand at around 3 billion cases and total production estimated at 2.8 billion.
The Report also highlights the impact of the crash in 2008, which showed investors that investments which had been considered good diversifiers were actually highly correlated – with sharp negative price movements mirrored across developed and emerging equities, bonds and property. Wine, with its inverse supply and demand curve and only a 15% correlation with the mainstream financial markets, performed better during 2008/09. It cites Knight Frank’s Luxury Investment Index which shows that fine wine experienced 234% growth in the ten years from Q4 2004 to Q4 2014.
The Fine Wine Report explores supply and demand characteristics, international buyer profiles, and investment strategies as well as the challenges around valuation and the expertise available to best optimise this portfolio diversifier.
Guy Tolhurst concludes: “The last four years have clearly demonstrated that playing the fine wine market is not without its risks, but that those who use expert advice to identify good value, acquire and divest at the right times, diversify their collections and understand that this is not a short term, highly liquid investment, are likely to learn more about the sector and more fully profit from the potential benefits on offer.”
Cult Wines Ltd is one of the UK’s leading fine wine investment companies, with a highly trained team of specialists who bring with them a wealth of financial markets expertise and fine wine experience. A family business based in Richmond, with core values of openness and transparency, we are perfectly positioned to advise a global private client base on the full potential of investment in this market. One of our key strengths is our dynamic and forward-thinking approach to analysis and research, we are constantly engaged in developing leading edge market strategies and providing up to the minute market data.