Oxstones Investment Club™If you’re skeptic about investing in fine wine, maybe it’s time to have a closer look at the recent market changes. Nowadays, we have investment funds that are focused only on the wines, so if you want to protect your asset, you are advised to consider the numerous storage solutions available for long term aging. Believe it or not, wine investments are just like any other domain. You don’t have to be an avid connoisseur to get started, but you must be an aficionado. They say that if you have a dream and you really want to make it happen, you can do it.
Set up a goal
Are you looking to invest in vintages or you want to focus your business on drinkable wine for the average people? Whatever your choice, don’t forget to make a plan; set up a budget, talk to people who know the business, hire a lawyer, and take care of the papers. As long as you do everything by the book, your investment will be safe.
Be ready to take the risk
Investing in fine wine can be an excellent idea for people who really want to set up a profitable business. Yet, don’t rush things through and answer to this question first: are you ready to fail? Every personal business is risky and every domain has its pros and cons. The wine market makes no exception, and if you’re aware that failure might happen, then you’re ready to get started. It’s true that wine investments can bring large gains, but they also come with some risks. This type of investment is similar to speculative activities, which means that they feature the same menaces. Wine funds can help you lower these risks, but private purchases allow you to drink your investment in case something goes wrong.
Finite Supply
Perhaps the greatest advantage related to wine investments is the fact that any stock comes with limited supply. That’s good news for investors because the global demand is decreasing and a limited supply of fine wine makes the investment profitable.
Fine wines increase their value in time
Fine wines get matured once they’re bottled, and their taste becomes better as time goes by. Besides, fine wines are produced in limited amounts, and every consumed bottle of wine makes the supply become smaller. As you can imagine, a small supply usually implies a high demand, especially if the wine is matured. People’s demand of fine wine and their interest towards this investment has increased significantly in the latest period, mostly because the supply cannot be increased.
Wine funds
Once you’ve decided to invest in wine, you can start to purchase crates or bottles individually or simply buy shares in a properly managed fund. These managed funds are specialized in high-quality wines and will do everything in your place, providing you with the gains. Wine fund managers usually purchase a wide range of vintages so that the fund remains untouched by potential value drops. Bear in mind that the returns are very attractive, and this is one of the main reasons why you should invest in a wine fund.
What most investors like about wines is that their value doesn’t fluctuate whenever outside forces try to influence the situation. However, there are still some risks involved, considering that one bad review for a vintage can make its value drop remarkably, especially in a weakened economy where people cannot afford to overspend.
Be patient
Unlike other businesses, the wine market is like a roller coaster where investors must anticipate steady returns says writer Paul Sullivan. If you’re not patient you can’t reap the benefits of your investment, and wines need up to 5 years to reach maturation. Proper storage conditions and extra care are of the utmost importance, and as long as you’re properly informed and you understand the risks, your investment is secure.
People should invest in fine wine because the investment can be stable and profitable. You don’t have to be a connoisseur to succeed but you must love the wine. Apart from being a tax-free investment, the supply is finite and therefore people will be willing to pay more if they know the variety diminishes. It’s certainly not easy to make profit, but if you’re convinced that your strategies can outperform the competition, then have great chances of success.
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