Why Invest in Wine?

Investing in wines is one of those buzz worthy, plastered over the news stories that makes everybody want to instantly become a wine investor. While being a wine investor may sound fun and luxurious, it is not for everybody and does require some hard work, planning, executing, patience and trial and error. So, as a potential wine investor, why should you invest in wine?

A wine investor will find that there are many benefits in investing in wine. Some of these benefits include:

o Less volatility than the stock market. While any particular investment wine can go up or down in value, fine wines are generally improving assets, which means they are worth more as time goes on.

o There is more demand than supply. This factors in to why an investment wine will be worth more as times goes on. As a wine investor, you will find that only the best of wines will be worth your time. These wines are generally rare and have a limited production or vintage. This makes the demand high to begin with, with a low and fixed supply. Within that fixed supply, as time goes on people will be drinking those wines making an even smaller supply, and driving demand up even farther. In turn, prices will go up. As you can see, patience is a crucial element as a wine investor, as a great label and vintage will only improve as time goes on.

o Wine investing is not tied to the stock market. That means if the stock market crashes or is in a downward period, your wine investment will not necessarily be losing money. Investing in wines is separate from the stock market and is a great way to diversify your holdings.

o You can have a great time and improve your knowledge. A prospective wine investor is typically somebody who has an interest in fine wines and loves drinking wines as well. As you begin exploring wine investments, you will find that you learn more about wine varietals around the globe, the best labels and vintages and more. This will turn you from a part-time wine hobbyist to a full fledged wine expert.

o Wines are typically considered a wasting asset. That means that the profits you earn from being a wine investor may be tax free depending on where you live and what regulations there are.

o You’ve surely heard the phrase: you reap what you sow. But the wine investor will be more familiar with the phrase: you drink what you invest! As a wine investor you may only be interested in making a profit on aging fine wines. However, you may also be making an investment in wines you will plan on drinking in the future. You can wait until they mature and age and enjoy them yourself. Or if the value does not increase significantly you can just drink the wines yourself. You can’t do that with stocks or bonds, can you? :)

Wine will definitely increase in its value so you don’t worry about drinking the wine in the end.