By Rebecca Lake. Prices are driven by, among other things, waves of new investors, macroeconomic conditions in emerging markets, notably and vintage quality. Auction houses are not the only ones to have migrated online. Before you can make a wine investment, you need to have a certain of understanding about what it is you’re investing in.
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Less gout, more buy-out
These are external links and will open in a new window. Sarah, not her real name, lives in the East Midlands and is in her fifties. Her husband died 10 years ago and her inheritance meant she had money to invest. A couple of years after her husband died, Sarah started receiving calls from a firm called Bordeaux UK Limited, offering to help her buy wine as an investment. Sarah paid for the investment with money from her savings account and received certificates stating that bottled wine had been bought and was being stored under her name in a bonded warehouse. Over the next couple of years she invested a little more money, sold some wine, and then reinvested the profits in more wine, as Bordeaux UK Limited advised her to.
These are external links and will open in a new window. Sarah, not her real name, lives in the East Midlands and is in her fifties. Her husband died 10 years ago and her inheritance meant she had money to invest.
A couple of years after her husband died, Sarah started receiving calls from a firm called Bordeaux UK Limited, offering to help her buy wine as an investment. Sarah paid for the investment with money from her savings account and received certificates stating that bottled wine had been bought and was being stored under her name in a bonded warehouse.
Over the next couple of years she invested a little more money, sold some wine, and then reinvested the profits in more wine, as Bordeaux UK Limited advised her to. Then as the stock market crashed and returns on savings plummeted, she decided to put money from her maturing bonds and her earnings into vintage Bordeaux as. To get them off the phone I ended up agreeing to buy something,» she told Radio 4’s Money Box programme.
Then in November of last year she received a short letter from Bordeaux UK Limited which said: «The company has some administration problems and it was decided that the best way to resolve them was to put the company into liquidation. Sarah could not believe that she was now at risk of losing so much money: «I knew I might not get back what I put in, but I wasn’t expecting it to go bust.
Sarah is not alone in being worried. Jim Budd is a fine wine expert who also reports on the possible pitfalls of investing in this area. He attended a meeting called by the firm’s liquidator: «It was very clear from the creditors’ meeting that financial records were in a complete mess as they were unable to establish exactly what the deficiency.
Nadim Ailyan, the insolvency practitioner handling the liquidation, says: «There are certainly strong elements of mismanagement on a colossal scale. Mr Ailyan says Bordeaux UK Limited is one of eight wine investment company collapses his company has dealt with recently. But the problem is likely to be even more widespread: «I would estimate in the last four years there have been at least fifty such companies which have been dealt with by other insolvency firms,» he says.
The government admits accidentally uploading a list of addresses including that of Sir Elton John. It is thought more than 50 UK-based vintage wine investment firms have collapsed in that period. Liquidators say they have uncovered examples of «colossal» mismanagement. More on this story. Wine scammers fleecing investors. Around the BBC. Fine wine investment news 2020 Box. Related Internet links. Investing in Fine Wines.
Information for creditors. Top Stories 1, addresses published in honours list error The government admits accidentally uploading a list of addresses including that of Sir Elton John. Elsewhere on the BBC. Daily news briefing direct to your inbox Sign up for our newsletter. Why you can trust BBC News. Politics Home Parliaments Brexit.
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And until recently, the market followed the taste buds of invstment one man—Robert Parker, the dominant wine fihe of the past three decades. Before the financial crisis, wine investment was largely offered through pooled funds that would investmwnt a hefty fee simply for buying large volumes of the best-known Bordeaux. These arguments are not new. A well-diversified portfolio is essential for managing risk and countering periods of volatility in the market. Audio edition. Additionally, wines can also be purchased from fine wine merchants, or through vetted wine auctions. A traditional portfolio includes a mix fine wine investment news 2020 stocks and bonds, but there are a host of alternative investment possibilities to choose. While these investments may have low buy-in points, wine is a different animal. Subscribe to The Economist today. That certainly seems true of the best estates. Investors may already be starting to sober up. But that does not prevent outright scams, often targeted at the elderly, from proliferating.
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