If you have extra money and are not sure where to invest, alternative markets can offer satisfying rewards and benefits that are not typically found in the more traditional markets. Alternative investments can run the gamut from coins to vintage cars to artwork to fine wines, but the common thread throughout all of these markets is that you own something tangible. You can enjoy looking at your investments or showing them off while waiting for the right time to sell for profit.
Fine Wine as a Safe (and Fun) Investment
For safe portfolio diversification, investment in fine wines has increased in popularity as a hedge against wild fluctuations in the stock market or other financial markets. When properly handled and stored, wines from established estates will improve with age and become dearer as supply runs low. But be careful here because for investment purposes, not all wines are the same.
Investment Grade Wine
There is a great variety of New World wines available to enjoy around the table, but estates from Bordeaux produce the tried and true vintages that do not flux with changes in the stock market. The majority of investment wines come from Bordeaux, with producers from Champagne, Burgundy and the Rhone Valley making up most of the remaining supply.
Global Warming Improves Vintages
The steady increase in worldwide temperatures has been good for the grapes. The warmer weather has positively affected wines coming from Burgundy and Bordeaux over the past decade and it seems that the trend will continue. There have been fewer storms to damage vineyards and overall climate changes have helped produce vintages that can be purchased with little doubt that they will increase in value. The only question is how much?
The best advice for a beginning investment? Study the market, narrow down your preferences and consult with a reputable wine merchant to find a suitable entry point.