| NEW YORK, June 19
NEW YORK, June 19 When investing in wine, as
opposed to drinking it, experts advise leaving your taste buds
at the cellar door but keeping your eyes wide-open.
Wine is highly regulated, but the market it trades in is
not, and the entry fee is not for the faint of heart.
"For proper investment in wine you really need to separate
out your personal taste and your personal preference from
investment purposes. These are two entirely different goals,"
said Jennifer Simonetti-Bryan, author most recently of "The One
Minute Wine Master" and "Pairing with the Masters: A Definitive
Guide to Food & Wine."
"Wine is completely emotional and that's what makes it very
difficult as an asset class," said Simonetti-Bryan, who before
attaining the top qualification of Master of Wine, worked as a
financial analyst in London.
Collectible wine represents less than 1 percent of the
entire world's annual wine production. The other 99 percent of
this year's output will be up for tasting and sale at VinExpo,
the industry's global trade show in Bordeaux that runs through
But at least some of that top 1 percent, the classified
growths of prized Bordeaux, have already been sampled, rated and
Investors "can do extraordinarily well, but only if you know
what you're doing," said Charles Curtis, the former head of
wines in New York and Hong Kong for Christie's auction house,
who now advises wine collectors and investors. ().
Curtis, like Simonnetti-Bryan, is one of 300 people in the
world to hold the coveted Master of Wine title,
"To be successful in investing in any alternative asset -
wine, jewelry, art - you have to have a passion for what you
collect," said Curtis, whose clients range from those with small
collections to those with "five (million dollar) to $10 million
Timing is also crucial. For example, take the price of a
case of 1982 Lafite, the premiere cru Bordeaux. Its cost rose to
about $64,000 in May 2011, only to fall to less than $40,000 in
"The '82s began to flood the market last year because they
were 30 years old and they're peaking," said Jennifer
Williams-Bulkeley, who worked in London and managed a portfolio
in which the assets were mostly stocks and bonds.
She recently opened a Boston-based wine investment advisory
service and applies a soupçon of statistics and a pinch of
analytics, combined with a knowledge of terroir to the
investment portfolios of her wine clients.
"If you're properly managing your wine portfolio, you know
when to sell it," said Williams-Bulkeley.
In addition to timing, wine must be stored correctly,
shipped properly and have impeccable provenance to qualify as a
Questions about provenance are behind a lawsuit filed
against celebrity Chef Charlie Trotter. Two New York collectors
sued in Chicago's federal court, accusing Trotter of selling
them a big bogus bottle of 1945 Burgundy for more than $46,000.
Some auction houses have also been sued for selling suspect
Auctions generate most of the publicity, yet they represent
a fairly small percentage of the roughly $4 billion fine wine
market. So far this year, the auction houses of Acker, Merrall &
Condit, Christie's, Hart Davis Hart, and Sotheby's have sold a
little over $100 million worth of fine wine around the world.
While this spring's auction season still has a couple of
auctions left and final totals are not in, it looks as though
sales will be lower than the first half of last year, when sales
totaled about $160 million.
If you still want to get started investing in wine, you'll
need to open your wallet wide. Curtis pegged the minimum needed
to begin investing seriously in wine at about $100,000.
Williams-Bulkeley's managed accounts begin at $250,000.
In the Europe and Asia, it is still possible for
sophisticated investors to put money into wine funds for
comparatively little - between $15,000 and $50,000. But the
funds are not without risk. Some are suffering from liquidity
problems and unrealistic valuations of their holdings.
Last month, regulators in Luxembourg forced the wine fund
Nobles Crus to suspend redemptions temporarily after the fund
manager admitted it did not have enough cash on hand to meet