3 Alternative Investment Opportunities Involving Wine - Wine Investment
Many people get worried and alarmed about the economy and any nest egg of investments they have with the stock market. There will always be moments of panic which is why savvy investors are always on the hunt for alternative investment opportunities. If you enjoy drinking wine, you may wish to follow your passion into new ways of investment. We have some interesting examples you may wish to research more into.
Investing in Wine Stocks
While 2018 was a difficult year for alcohol stocks in general because of shifting consumer preferences, current conditions look to be changing that. Finding your favorite wine and verifying if they have a public company that’s worth trading on via a wine stock, is a great way to be involved. Constellation Brands (STZ) produces beers, vodka, and wines by Robert Mondavi and has been seeking new ways of growth going into the latter half of 2019. Diageo (DEO) is a distilling company based in London but is involved in Moët Hennessy and other makers. While Truett-Hurst (THST) is a small wine producer trading at penny stock levels, they have had some stock boosts due to interesting factors that might be attractive.
Moving on from individual stock listings, there are also exchange-traded funds (ETFs) that specifically deal in alternative investments such as wines, stamps, autographs, and art. The Liv-ex Fine Wine 100 Index is an example of a wine trading and data platform. There are also more specific ETFs and mutual funds that deal with wine and other alcohol related matters that you may wish to search out or ask your investment advisor about.
List of Best Wine Stocks
- Constellation Brands - STZ
- Diageo - DEO
- Truuett-Hurst Inc. - THST
- Vina Concha y Toro SA - VCO
- Molson Coors - TAP
- Brown-Forman - BF-B
Buying Wine Futures
Purchasing wine futures means to make a promise to purchase wine that is still maturing in wine barrels and has not been purchased yet. Buying futures is an excellent opportunity to have access to your favorite wines and is a common habit of wine enthusiasts. When you have very rare bottles of wine, buying futures is a way to guarantee you will have access to them. You also may be interested in purchasing them to secure a special birth year of a wine in memory of loved ones, grandchildren, or to use as a gift. The excellent benefit being the popularity of the wines driving up prices due to demographic and geographic changes in purchases of wine.
Jim Deckebach, the founder and CEO of Wine Cellar Innovations, remarked, “One of my best deals was purchasing a case future contract of Chateau Latour 1990 for $136 per bottle. After two to three years it was bottled and reviewed by the Wine Spectator which gave it their best wine of the year award. The price peaked at over $1,000 before dropping down. My last two bottles were enjoyed with friends in 2013”.
To better protect wine prices, Chateau Latour announced in 2012 that they were no longer going to sell futures on the wine futures exchange. Latour’s General Director, Frederic Engerer, said 2011 was the last vintage to be sold that way. Engerer expects to hold the Chateau Latour for 10 to 12 years before starting to sell it in the open market. He says the past ways of marketing their wine through future channels had their wines traveling and changing hands so often during the first 10-12 years that one could buy a bottle and not be pleased with the turnout because of travel and cellaring conditions.
Investing Directly in Wine Bottles
The point of having a cellar is to purchase wines and keep them in a perfect condition for the wine to reach maturity and drink it at the right time. Purchasing Cabernet in the late 1990’s and being able to pull it out 20 years later to drink is quite an amazing thing. Naturally, wines are also a great investment and should be treated accordingly. Keeping an ideal temperature, humidity, ventilation, darkness, and security is key.
Purchasing wines for pleasure and investment can be mutually enjoyable. The best wines to buy for investment might not be the ones you think. You might find a wine that is not expensive but is still a great deal. Deckebach purchased a bottle of Silk and Spice 2015 Red Blend from Portugal that was a great value at $10.88 and he ended up buying three cases which will last quite a while. For favorite wines, Deckebach started purchasing a yearly case of Rombauer Chardonnay starting in 2003. He currently has a case of the 2017, 2016, and 2015 with a bottle left of the 2014 that is still drinking well since it was properly stored. Another example would be two bottles of 1990 Antinori Tignanello that peaked in 2011. These bottles are still holding well at 55 degrees and 75% relative humidity in his wine cellar. Figuring out how to invest in wine can be fun and entertaining, especially finding best investment wines that you find lucrative.
Having special memories attached to certain wine bottle years make drinking all the more sweet. Deckebach has six bottles left of Chateau Mouton-Rothschild 1998 and after sampling a bottle in 2016, he noted in his database to try again in 2020 and let it breathe. The wine will have achieved longevity and the best memory would be in 1998, the year he purchased the building where Wine Cellar Innovations now resides. For other special memories, Deckebach has about 30 different wines and vintages from a favorite Herman Store Wines which are sold exclusively through their club, traveling tastings and the vineyard that has a wine cellar that he traded for.
Deckebach comments, "If there is no place to store wine bottles, there might never be an opportunity to pick up these great values which is why a great reason to have a wine cellar and buy on release is to let your wine slumber to perfection. Life is rough when there are so many treasures that I need to keep entertaining and drinking to keep them from going over the hill!".
Is wine a good investment? We will let you decide but we certainly think so!
Letting Wines Age Gracefully
Barry Baum is a Wine Cellar Innovations customer from Duluth, GA and is a proud owner of a beautiful All-Heart Redwood 28-year old wine cellar. The wine cellar was originally designed and installed in 1991 by Jim Deckebach. Creating a dedicated space in one's home for their wine collection is essential in order to provide the right environment for those bottles. This is why wine rooms are a growing trend in new home construction. Homeowners across the world have taken to remodeling their existing living spaces to make way for properly storing and showcasing their wine collections.
According to Baum, “The wine cellar has most definitely withstood the test of time. This includes not only how well the storage has worked out, but also how well the all-heart redwood has aged. It still smells great in there!”
The wine cellar was built double deep on two of the walls to maximize wine storage and included specific areas for magnums and half bottles. Bulk storage is important for the cases Baum enjoyed to collect. Over the years several improvements were made with the help of Wine Cellar Innovations. These included a wood and etched glass wine cellar door, tasting storage table, and redoing the tile floor along with a split cooling system that was replaced with a ducted system. This system allowed for a decorative nook to be built. The wine bottle chandelier was a favorite decoration that added to the ambiance. The current capacity of the wine cellar allows for 4,430 wine bottles and is currently over 90% full. View more photos of this beautiful wine cellar.
Baum added, "After 28 years, we still very much enjoy our wine cellar. I can't count the number of great comments we received from friends and family and often recommend Wine Cellar Innovations. Looking back 28 years, it's possible we may have done a few things differently if you were designing it now given all the new products you have introduced. I certainly agree with you on the advantages of a large cellar. Being able to pull a 1995 Cabernet to have with burgers is no big deal, and certainly no need for house wines. Our "house" wines are 20 year old Bordeaux and Rhones, 10+ year old Zins, Pinots and Chardonnays, and whatever else fits our fancy with whatever food we're serving."
Of course, with the introduction of recent wine racking products from Wine Cellar Innovations such as the Modern Wine Cellar Series, Wine Sentinel Wine Cabinets, and Glass Enclosed Wine Cellars, and with specialty stains and finishes such as Whitewash, Graywash and Opaque White, Baum's wine cellar design might have gone the contemporary route. New trends show a mix and match of wood and metal materials, particularly with the racking units. Nonetheless, this 28-year old wine cellar has embraced the years with as much grace as the wine bottles it stores.
With over 30 years of professional experience, Wine Cellar Innovations professional consultants are ready to create a free design and help you achieve any traditional, modern, or contemporary look you seek for your wine cellar project.