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Wine Investment

Richard Kihl Ltd has a track record of over fifty years in sourcing the finest wines for investment, for our customers.  Our long-standing relationships with many of the world's most sought-after domaines are one of our greatest strengths, along with the level of personal service we offer to our clients.  

Fine wine, along with fine art, is one of the more pleasurable investments one can make.  You do not need to be an expert and we are always happy to give advice.  As wine merchants, our focus is on wines and vintages; their potential quality and market conditions.  We are not registered by the FSA and so are not qualified to give investment advice, other than to remind customers that of course wine prices may go down as well as up!  However, we would be happy to try and answer any questions you may have.

The data above from Liv-Ex shows that over the five years to February 2020, the fine wine market out-performed equities.

Simple supply and demand is a compelling argument for investing in fine wine. The classic appellations are strictly delimited and vineyard prices have risen rapidly in recent years.  Burgundy is a case in point, where the average price per hectare of grand cru vineyard doubled from around seven million euros in 2008 to 14 million euros in 2017 (current prices are closer to 20 million euros).  Added to this, the trend is for producers to reduce yields each year as they strive for ever-higher quality.

Meanwhile, demand globally is rising as new markets emerge and fine wine is added to the portfolio of luxury products desired by a growing population of millionaires. Furthermore, each time they open a bottle, supply is lowered still further and upward pressure on prices increases.

The diversity of investment wines is increasing, year by year.  In 2010, Bordeaux First Growths accounted for 61.9% of secondary market trade by value.  By 2020, this had fallen to 32.6%.  However, the number of wines which we would class as 'investment grade' is still relatively limited, with costs usually starting at £750-£1000 per case. 

As with all investment, it is usually wise to spread funds across a portfolio of wines, hence a meaningful initial investment might be from £5000.  We can also accept monthly direct debits from £250, making buying recommendations as and when funds have been accrued. 

Finally, and importantly, wine has traditionally been regarded as a 'wasting asset' by HMRC and therefore may not attract Capital Gains Tax.  For current legislation and further details of any tax implications please speak to your financial adviser.

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