Wine Investment

Use WineWorld Xplorer’s (WWX) transparent, open and connected global live wine offers database to empower your wine investment decisions. WWX offers flexible arrangements for potential wine investors, ranging from self-initiated trading support with preferential commission rates, to full-service wine investment portfolio construction and consultancy.

 

Simply sign up for free as a Buyer to receive our Wine Portfolio Management and Investment Guide, plus gain access to Asia’s largest live wine offer database. Wish to speak directly with our wine team to get your wine buying and investment questions answered? Simply contact us using below contact form or email us at cs@wwxplorer.com.

The WWX Difference

A data-driven approach to Wine investment and Asset management

WWX’s powerful price search and critic score engine allows our team to access real-time wine price and market supply-demand data in 3 key global wine markets. Our Data Scientist’s team creates and continuously monitors our own set of Big Data-backed algorithms to track and project wine prices, as well as identifying lucrative opportunities. To encourage a data-driven approach to wine asset management, all WWX users enjoy free access to WWX’s real time portfolio valuation and management tools, allowing them to track portfolio growth as well as individual wine’s asset ageability status, professional review and current location.

Extensive global wine trading and fine wine servicing experience and expertise

WWX’s founding team comprises a mix of fine wine specialists, data scientists and award-winning IT programmers. Founder Mariana Lam is a serial entrepreneur in the field of wine starting year 2008. Chief Data Scientist Samuel Sum brings his advanced data analytics and business intelligence solution design expertise, as well as his ardent love for wines, to the table. WSET Diploma holder and Certified Wine Educator Anty Fung oversees offer vetting and all wine contents. The team is completed with trilingual speakers fluent in Cantonese, Mandarin, English and French; all of which are WSET-certified and have worked in various industry roles in Hong Kong and China, USA and Middle East prior.

Skip the middleman and buy direct at sources with flexible ship-and-store solutions

WWX seller network comprises some of world’s largest institutional sellers and wine funds whom previously only trade and supply to regional and local wine sellers. Our code of anonymity enables them to release their stock directly to private clients, thus creating a substantial competitive edge, in terms of both prices and stock accessibility, for collectors. For our growing pool of wine investors, we offer the possibility to buy direct at sources e.g. Bordeaux, after which users can flexibly choose to ship the wines back to Hong Kong or store them securely in the bonded warehouses of Bordeaux at competitive costs

 

Simply sign up for free as a Buyer to receive our Wine Portfolio Management and Investment Guide, plus gain access to Asia’s largest live wine offer database. Wish to speak directly with our wine team to get your wine buying and investment questions answered? Simply contact us using below contact form or email us at cs@wwxplorer.com.

A closer look at short to mid-term fine wine performance

As Team WWX will soon illustrate below, fine wine as a segment has proven to be a strong alternative asset to hold for long term. In terms of long term we refer to a timeframe of 5 on the minimum, and extend all the way to 30+ years. Ample academic research has been done on the long-term value appreciation potential for fine wines. Team WWX seeks to supplement research in the area of short- to mid-term investment of fine wines. Through studying fine wine price trends since 2019, we confirm the allure of fine wines being one that stay relatively buoyant and unaffected during volatile market episodes. We conclude 3 key points that you should know about recent fine wine price trends.

Watch these winners: Italian wines, Champagne and New World wines

Since November 2019 till to-date, top performers are Italy (+4.73%), Champagne (+1.15%) and New World wines (+1.13%). Within each category, index components are chiefly made up of recognized brands and their price trends from wines released from vintage 2005 to 2015.

2020 new norm: time to add White Burgundy and New World wines to your radar

Burgundy white’s performance improves and surpasses other regions since beginning of 2020. Over in New World, California Index and New World index were in sync for the most parts of year 2019. Starting year 2020, New World index remains buoyant whilst California Index comprising of heavyweight players like Opus One, BOND, Harlan took a dip. You may want to read up on our previous blog on how Opus One intriguingly show a high level of correlation with Dow Jones Index, a behaviour rather contrary to the general belief that wines are great to hedge against stock market fluctuations.

Top red Bordeaux and Burgundy: hold and be patient.

Bordeaux Big 10 and second wines for the past two years have been rather unremarkable. Since hitting the high note in January 2019, the index has been moving to lower grounds and hit recent trough in April 2020. Some form of recovery has been seen in July 2020. Over in Burgundy, red Burgundies generally outperform whites until Jan 2020 when red Burgundies prices take a noticeable dip. Recovery was seen in August 2020 but yet to show sure sign of robustness. Compare Bordeaux Big 10 vs Burgundy reds, Burgundy reds show better quality preserving value until March 2020 when the index of both regions converge and start showing synchronized movements.

Covid-19: Who made the speediest recovery?

From 9th March 2020 to 23th March 2020, all wine indices suffered a noticeable slump ranging from -5.7% to -2.4%. That coincided with the same period when global stock markets plummeted as much as -25% (Dow Jones Index). Indices suffering the most are Burgundy Red (-5.7%), Champagne (-5.1%) and Spain (-4.4%) while the ones resisting better than others is New World (-2.4%), following by Burgundy White (-3.5%). Particularly, our New World Index contains top performers mainly from South America, such as Sena and Almaviva. These also benefit a lot from features as emerging markets for huge advantages in price performance. By now, most indices have seen marked recovery: Spain (+6.4%), Italy (+6.0%) and Right Bank Bordeaux Seconds (+5.1%). Traditional blue chips – Bordeaux Big 10 – has also rebounced by 4.3% since March 2020.

That sums up what fine wine data reveals in terms of trends for the past 2 years. I hope you enjoy our data-backed approach of what’s going on in the world of fine wines. This is a direction which Wineworld Xplorer will further pursue in anticipation that in near future, we will be able to generate reliable predictive analysis to help traders and investors better assess and strategize their trading decisions. Do keep following our progress as we refine our modeling work and actively update index components composition.

 

Why invest in wines?

Wine as a Hedge

Our team has long studied the behavior of wine as an asset class and in a lot of ways, it performs distinctively differently than other conventional asset classes including stocks, gold, bonds or FOREX. At present, fine wines are seen as traditional commodities with a strong value preservation edge. As an alternative asset class in a UHNW/HNW investment portfolio, the allure of fine wines as a segment lies in its relative stability in price and demand especially during volatile market episodes.

Undeniably, with superior knowledge, help of advanced data analytics and well-timed acquisitions, fine wines can present lucrative returns and opportunities – over the 15-year period of 2003 to 2018, red Burgundy has attained a return of 497%, dwarfing red Bordeaux which yielded ~255%. WWX is due to publicly release a smart risk assessment tool to assist all prospective wine investors to better define a fitting wine investment strategy – with the ultimate goal of fulfilling individual investors’ returns expectations upon liquidation of wine portfolio within specified timeframe.

Wine as a Collateral

This is a relatively less-explored aspect of wine investment. Utilizing two of our technologies: fine wine price valuation and smart bottle authenticity and integrity tracking system VinoGuard, WWX offers wine collectors a way to create financial leverage using their wine collection as collateral. Currently, WWX accepts a prescreened list of 500 fine wines of the world as eligible collateral candidates. A stringent process of physical checking and provenance verification will be done before credit approval. All collateralized bottles will be kept in one of WWX’s temperature and humidity-controlled vaults. Collectors can enjoy years to decades of additional cash liquidity for other ventures, whilst their prized wine collection ages quietly and gracefully in WWX wine vaults.

Maximize future drinking pleasure

This is one of the most traditional wine investment goals. This often refers to the strategic acquisition of wines as futures (“en primeur”) or at embryonic stage (“recent vintage release”). The wines will tend to have to see a few years to decades before they are ripe for enjoyment. This can supplement with year-round hunting of developing and mature wines that are spontaneously released on the markets at favourable, below-market prices. The primary goal of this form of investment strategy is to maximize the investor’s future drinking pleasure. WWX has also previously handled legacy planning requests from UNHW/HNW clients where a wine collection of certain dollar value is compiled with the goal of passing on as inheritance and next-generation enjoyment.

FAQ

Recent meltdowns in global stock markets have renewed interest in alternative assets – fine wines being one of them. Indeed, if you look at fine wines vs equities from end of last year till now, fine wines as an asset class has shown much resilience when global equities took on a rollercoaster ride over past few weeks. With uncertainties looming at bay, investors begin to search for safer havens. Team WWX summarizes a few frequently asked questions about wine investment:

Is fine wines a safe haven asset?

Yes. Safe haven asset refers to financial instruments that retain, or sometimes gain, value during market volatility and economic recessions. Fine Wine as a category has consistently shown negative correlation against other assets such as equities, foreign exchange during times of turbulence. In essence, fine wine prices often remain stable, with some maintaining steady appreciation, when equities market suffer.

How do I invest in fine wines?

There are multiple ways to do so – the main difference is your level of involvement and operational transparency. If you prefer a hands-off approach, explore full service wine investment consultancy. All you have to do is to speak to one of our specialists so that we can set an optimal investment amount and design a customized portfolio for you basing on your investment goals.

Say if you want to take things into your own hands, simply subscribe to our Private Collector (HKD 1,299 per year) plan. You will then be able to buy and sell wine assets at one of the lowest trading commission rates in the world – 4.5%.

The third way is to invest into a wine fund. Your fund managers will take care of all trading operations for you. Instead of owning actual bottles, you will be subscribing to units of the fund. Your returns will be what’s left after deducting management and performance fees.

Is there any initial minimum investment requirement?

$0 if you plan to do all trading yourself.

How easy is it to sell my investments? And how do I keep track of their value?

WWX currently has a reach to nearly 20,000 active wine buyers and professional traders in Asia. Whilst wine selling will never quite see the same ease and liquidity as that of equities, given that the right prices are being set, it is not difficult to liquidate your stock. Additionally, we maintain daily newsletters highlighting competitive offers on the platform to enhance reach and visibility of platform offers.

Private Collector plan subscribers have exclusive access to “My Portfolio” module, a comprehensive set of graphs and tables that help you track your portfolio value and trends. You can access real-time portfolio valuation anytime via your own account.

What are the key goals of investing in fine wines?

There are various reasons why people dabble with wine investment – using wine as a hedge, diversification of wealth, future consumption and legacy planning. Scroll back up to read the section on “Why Invest In Wine?”

 

Simply sign up for free as a Buyer to receive our Wine Portfolio Management and Investment Guide, plus gain access to Asia’s largest live wine offer database. Wish to speak directly with our wine team to get your wine buying and investment questions answered? Simply contact us using below contact form or email us at cs@wwxplorer.com.

To find out more, simply leave us your details and we will reach out to you.