Investing in wine - does anyone here?

[cslwannabe]

Considering investing in wine as very difficult to know what to do with any 'spare' money at the moment. Considering buying some wine 'in bond' - anyone here done it and prepared to say who they used and any comments about the tax side of things etc? Thanks in advance.

[NoelWatson]

cslwannabe said:

Considering investing in wine as very difficult to know what to do with any 'spare' money at the moment. Considering buying some wine 'in bond' - anyone here done it and prepared to say who they used and any comments about the tax side of things etc? Thanks in advance.

What tax side of things?

[Beggarall]

I have an interest in this and particularly after seeing one of those money programmes on TV indicating that wine has been the most profitable investment over the past 20 - 30 years - way ahead of property or the stock market. However, some of the prices being asked for the top quality wines are astronomical and it is hard to see how they will make money (2009 Chateau Lafite Rothschild currently selling at £14,000 per case with no prospect of drinking it for many years) although I am assured they will and do! It is a far cry from thinking you have spent a lot on a bottle when you pay £10 - £15 in the local off-licence for a special occasion - and I know you can spend a great deal more for the same wines in some restaurants!
However, I don't think the premier wines are for lesser mortals to drink. Apparently there is quite an interest from wealthy Chinese who buy expensive wines as a status symbol. It's amazing just how much money some people have. So looks like an interesting investment opportunity and the tax advantage is that it is free of CGT.

[juice]

We white label a wine investment fund here..the returns are quite good. Not something I'd ever looked into but the selection process is interesting...

[Mattt]

The Chinese love their fine wine and coke

If you look back through PHer Bebs' posts, he's given some useful advice regarding wine (and cigar) investments.

[NoelWatson]

Beggarall said:

I have an interest in this and particularly after seeing one of those money programmes on TV indicating that wine has been the most profitable investment over the past 20 - 30 years - way ahead of property or the stock market.

I would like to know how they arrived at that conclusion

[Frankeh]

I've heard you're better investing in a fund as it's prohibitively expensive if you want to hold on to the bottles yourself.

[Dave_ITR]

NoelWatson said:

Beggarall said:

I have an interest in this and particularly after seeing one of those money programmes on TV indicating that wine has been the most profitable investment over the past 20 - 30 years - way ahead of property or the stock market.

I would like to know how they arrived at that conclusion

Indeed, I saw said programme & it was full of drivel.

[NoelWatson]

Frankeh said:

I've heard you're better investing in a fund as it's prohibitively expensive if you want to hold on to the bottles yourself.

£10 per case p/a. If you are buying cases <£500, that doesn't seem too bad

[14-7]

This is something that has interested me for a while but I've never actually looked in to it.

What companies do people on here use to purchase through and how does the set-up work? I know they keep the wine in their warehouses but do you buy per case, so in other words it's up to you to know what to buy, or do you just invest an amount that they then use to purchase? How do the sales then work?

Also, having browsed through a few companies on 't-internet some ask for astronomically high initial investments (one wanted £250,000 for a private investor).

[456mgt]

Bebs is your man http://www.pistonheads.com/gassing/profile.asp?h=0...

[NoelWatson]

14-7 said:

This is something that has interested me for a while but I've never actually looked in to it.

What companies do people on here use to purchase through and how does the set-up work? I know they keep the wine in their warehouses but do you buy per case, so in other words it's up to you to know what to buy, or do you just invest an amount that they then use to purchase? How do the sales then work?

Also, having browsed through a few companies on 't-internet some ask for astronomically high initial investments (one wanted £250,000 for a private investor).

I invest through my local

http://www.thevineking.com/

[Beardy10]

I've bought wine for myself that''s stored in bond and intended for drinking. I did actually put some money into a specific fund last year that invested in the 2008 Bordeaux vintage plus some of the older vintages....I did it because I thought the timing was good as the 2008 wines were obviously released during a time of great economic uncertainty and seemed "reasonably" priced compared to other vintages. The guy that runs the fund used to buy Bordeaux for one of the major London wine merchants and is highly regarded in the industry. It wasn't an asset class I was looking to invest in but I heard about this guy through a friend looked at doing it the year before and pulled the trigger last year. Personally I wouldn't invest at the moment, there was an awful lot of hype around the 2009 vintage with some eye watering prices....whilst the Chinese are supposed to be "very interested" if you read some of the wine forums it seems most of the vintage was bought through UK based speculators with a a couple of the big wine merchants rumoured to have very big positions in the expectation of the Chinese buying once it's in the bottle in a couple of years. Sounds like an accident waiting to happen to me.....

[prand]

Isn't wine classed a depreciating asset, therefore exempt from Capital Gains?

That in itself would make this a worthy candidate for any investment portfolio.

[Beardy10]

prand said:

Isn't wine classed a depreciating asset, therefore exempt from Capital Gains?

That in itself would make this a worthy candidate for any investment portfolio.

The technical term is a "wasting asset" but yes you're right. You need to own physical wine/actual bottles so if you do buy a fund it then has to allocate specific bottles/cases of wine to you for the investment to qualify. Which of course when you come to sell it means you can keep some for yourself!

[Zip106]

I keep getting calls from a company called Fine Wine Vintners, Berkeley St. in London. ( http://www.finewinevintners.co.uk/)
They want me to invest in Ponetet canet 2009 for an initial sum of £1100.

After a quick Google of the company I've decided to leave it but I'd still be interested in a well established company with a proven track record.
Anyone?

[Beardy10]

Zip106 said:

I keep getting calls from a company called Fine Wine Vintners, Berkeley St. in London. ( http://www.finewinevintners.co.uk/)
They want me to invest in Ponetet canet 2009 for an initial sum of £1100.

After a quick Google of the company I've decided to leave it but I'd still be interested in a well established company with a proven track record.
Anyone?

Well I've never heard of them (but that means nothing) but something doesn't feel right to me. They are offering you probably THE most sort after wine of the vintage (after the First Growth's) and they only seem to be offering the uber exclusive First Growth's on their website. The problem with the latter is that to get allocations of these wines the wine merchants have to also take allocations of much less desirable wine from the middle men of the wine world who are called negociants (or something similar)....they are basically wholsalers. So what are they doing with all these other wines ? I don't think there is an established wine merchant in the world that has needed to cold call someone to sell it's allocation of Pontet Canet this year.

The thing you really need to be careful of is that you need proof that these people are who they say they are an they actually have an allocation of this wine.....the wine world is full of con artists. Lastly the other thing you definitely need to consider is that if that company goes bust in the next two years you won't get a penny unless you pay by credit card. The wine is still in a barrel in a cellar in Bordeaux somewhere and is not actually held in your name until it's in a bottle in a bonded warehouse somewhere. So even if a company if legit should it go bust between the day you pay and the day you can take physical delivery of the wine you'll be lucky to get your money back and IF it has appreciated in value you definitely wouldn't get any of that appreciation. There's no protection from client money rules or the like...basically you have paid for something you can't take delivery of for two years so if the company goes bust in the meantime you're stuffed.

[Beardy10]

Just checked this fourm for "Fine Wine Vintners"

http://www.wine-pages.com/cgi-bin2/ultimatebb.cgi?...

Wide berth...........

That's actually a fairly decent website for getting an idea of what goes on with wine. Jancis Robsinson's website is pretty good too but it's a subscription service to access to the forum.

[Zip106]

Thanks Beardy that's very interesting.

I did a Companies House search on them - seem to be quite a new company with the sole director having a birthdate of 1986!
Obviously experienced.

They even had to change their name 3 times due to spelling errors.

You'll notice I spelled Pontet Canet wrong in my previous post - I cut and pasted the name from an email they sent me.
When they can't get the name of the very thing they're trying to sell me, correct...

[Beardy10]

I hadn't spotted your Pontet Canet spelling. You've obviously come up on a list somewhere as being a wealthy sophisticated investor!