Oxstones Investment Club™You might have seen your friend or associate buying a bottle of wine for $40, which might turn up into an investment of $400 in the future. Do you feel comfortable in investing in an asset, which disappears with a broken bottle? How could you predict the price of a bottle in the next 5 to 10 years? How much would you spend in storing your wine? These are some of the most common questions of beginning wine investors. The past few years have seen an increase in the number of wine investors and even with the Wall Street showing interest in the wine market, the stakes are expected to offer substantial returns.
Wine Investment
The first decision that you have to make in wine investment is whether you are doing it for the love of wine or for earning decent returns. For the wine lovers, it is possible to pick up certain wines of their choices expecting them to provide significant returns in the upcoming years. You can even drink some of these bottles if you would like to.
Storage and protection
If you are planning to store your favorite wine that you will use in a few weeks, a wine rack in your hall would do the trick. However, if you are investing in wine with the sole purpose of receiving better returns in future, it is best to choose an optimum storage condition for your wine. If stored at low temperatures, it might develop flaky crystals, although the wine is cold-stabilized before coming on the market. On the contrary, an excessively hot room is going to increase the maturity time of the wine, which means a prolonged waiting period for the wine lovers.
The proper method to store wine is to store it in a dark area and maintain optimal humidity and temperature levels. For people living in moderate climates, a dark closet is sufficient for the job or one can even store wine in the basement of the house. However, it is best to discuss optimum storage conditions with your cellar manager. He will guide you whether the climate in your area is suitable for storing or not. For large scale wine collectors, they might need a large wine cooler ad ample of space for the purpose. On the contrary, if you have less than 50 bottles, it is best to store them in your local cellar.
Wine Insurance: Ensure your wine
Wine collectors value expensive wines much similar to other art-crafts and jewelry possessions. You can get in touch with an insurance company and get insurance for the value of your wine. It is advised to compare the insurance premium from different companies and consider important factors like cost of the policy, coverage amount for your collection, and the deductible amount. For areas prone to natural disasters, your insurance company will ensure your wine against any damage due to these conditions.
How to identify the current value and future trends for a wine?
One can start with the ratings given by wine critics, which may vary on a scale of 1 to 100. One can choose wines that have a rating of 95 or above. These are considered to be a good investment and offer better returns with time. Another method is to choose wines depending upon the Liv- Ex index. Liv- Ex keeps a record of the best selling wines in the world and most of the wine brokers carry out trading through this platform. You can always get an idea with the Liv- Ex top 100 index, which has the top 100 wines of the world listed in it.
Investing with Wine Funds
If you are considering wines only as an investment, it is best to invest through wine funds. It can be difficult for everyone to store and mange wine with delicacy, especially for a new investor. There are more than a dozen options to choose from. These wine funds allow you to invest money without considering the storage of these wine bottles.
It is always risky to invest in wine, but considering the amount of returns one can get from Wine investments, it is worth a shot.
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