How are fine wine regions compared? What are the regional performance trends in investment wines? Can you even ask – which is best and why? We compare how the key wine regions for investors have performed so far in 2021 and the rationale for regional wine investments.
Trade in investment wines has broadened significantly from the Bordeaux-centric secondary market of a decade ago. In 2011 over 90% of the trade on Liv-ex was focused on Bordeaux, and the First Growths dominated. In 2021, Bordeaux now accounts for an average 40% of trade on an increasingly diverse secondary market. Burgundy, Champagne and Italy have been key drivers of growth in the last few years and the top wines of these regions are some of the most powerful fine wine brands today.
Investment wines regional trade share on Liv-ex in September 2021:
| Region | % Share of value traded |
| Bordeaux | 36.9% |
| Burgundy | 22% |
| Italy | 15.8% |
| USA | 10.1% |
| Champagne | 7.6% |
| Rhone | 4.2% |
| Others | 3.4% |
Source: Liv-ex.com, 30 September 2021
The Liv-ex 1000 benchmark records the broad activity of the market and comprises sub-indices which track individual regional performances. The average growth trends by region to the end of Q3 2021, over 1 year and 5 year periods shows the strength in those wine producers outside of Bordeaux and the returns they are providing to investors.
Regional fine wine performance trends YTD 2021:
| Liv-ex regional benchmark | 1 Year | YTD (30.09.21) | 5 Years |
| Burgundy 150 | 18.08% | 16.84% | 82.87% |
| Champagne 50 | 16.11% | 15.06% | 61.45% |
| Italy 100 | 10.39% | 6.25% | 45.72% |
| Rhone 100 | 11.59% | 9.24% | 28.94% |
| Bordeaux Legends 40 | 8.83% | 7.97% | 23.74% |
| Bordeaux 500 | 9.37% | 7.87% | 23.44% |
| RoW 60 | 13.03% | 11.99% | 30.80% |
| Liv-ex 1000 | 12.49% | 10.91% | 38.58% |
Source: Liv-ex.com 30th September 2021
The fine wine market’s record growth and trading levels in 2021 are being driven by transactions in wines from all the key wine investment regions. The broadest market measure, the Liv-ex 1000 index, has risen to record levels, rising 3.85% in September alone and 12.5% YTD. Regional price growth trends are strong across the board in 2021 which is proving to be the best performing year for investment wines on record.
Most traded investment wines by value & volume in Q3, 2021:
| Value | Region | Volume | Region |
| Lafite Rothschild, Pauillac | Bordeaux | Lafite Rothschild, Pauillac | Bordeaux |
| Petrus, Pomerol | Bordeaux | Pontet-Canet, Pauillac | Bordeaux |
| Mouton Rothschild, Pauillac | Bordeaux | Sassicaia, Tuscany | Italy |
| Haut Brion, Pessac -Leognan | Bordeaux | Bollinger, La Grande Année | Champagne |
| Domaine de la Romanée Conti, Romanée Conti | Burgundy | Domaine de la Janasse, Chateau Neuf du Pape | Rhone |
Source: Liv-ex Q3 Report 2021
Wine Investment Regions and reasons to invest in 2021:
Key reasons to invest in Bordeaux in 2021:
- Performance – Bordeaux icons outperformed S&P500 in Q3 2021
- Bordeaux blue-chips have out-performed safe-haven gold in 2021
- Liquidity – First growths are the most traded wines by value on Liv-ex
- Stable, low risk investments – hedge newer market opportunities
- Removal of US Tariffs has boosted growth in Bordeaux investments
Key reasons to invest in Burgundy in 2021:
- Liv-ex Burgundy 150 index up 18% in 1 year and the leading regional benchmark at the end of Q3
- Broadening market in Burgundy provides lower entry points
- DRC wine indices outperform Liv-ex market trend
- DRC ranked first in Liv-ex 2021 Classification
Key reasons to invest in Champagne in 2021:
- Champagne investment wines are some of the top price performers
- Add consistent, stable growth to your portfolio
- The entry point is accessible and offers value
- Champagne is a ‘liquid’ wine investment with an active secondary market
Key reasons to invest in Italy in 2021:
- Performance – the Liv-ex Italy 100 has grown 10.39% in 1 year
- Diversification – Italian investment wines are strong options
- Quality – Italian investment wines’ critical scores similar to First Growths
- Value – entry prices are more accessible with comparative % gains
- Established region – increasing secondary market activity in Italian wines
Key reasons to invest in Rhone in 2021:
- An emerging market
- Value – prices offer growth potential
- Diversification
Key reasons to invest in USA in 2021:
- Performance – the region’s wines are seeing strong price growth
- US wines have taken the Liv-ex RoW index to 13% growth in 1 year
- Aspirational investments with low production levels supporting sustained price growth as global demand rises for iconic labels
- Diversification – a proven region with some of the world’s most sought-after fine wine brands
In answer to the original question – no one region is ‘better’ than another. Each has a different history and complexity dictated by the terroir, climate, heritage, investment levels and viticultural capability. All of which combine to influence the quality of the wines produced, their demand in the secondary market and their value to investors. Diversifying a portfolio by region is essential to optimise portfolio performance.
For more information speak to a member of our expert team on 0203 384 2262 and see our latest Market Report