Key Factors Affecting Value of Fine Wine Investments
Including fine wine in your investment portfolio offers stability, proven long-term growth performance and the ability to diversify against more volatile financial markets. There are, however, key factors that influence the performance and value of fine wine over time which much be considered by those looking to invest. These include:
- The provenance of the vintage wine
- Storage in the optimum conditions to maintain the quality of the wine
- Storage in bond to benefit from the tax treatment in the UK
When it comes to purchasing fine wine for investment purposes, provenance is of upmost importance.
Literally speaking, provenance is the history and chronology of the ownership, custody or location of an object. In the case of assets of value, like fine wine, the clearer the chain of its source and the reputation of where it has been stored all have a significant impact on the price that can be commanded at the point of exit.
The highest quality provenance is acquiring wine directly from the wine producer, shipped straight from their cellars to your own storage arrangement. To find out more about tracing provenance, please click here to speak to a Fine Wine Expert.
Storing fine wine can be a difficult task, but by using bonded warehouses we are able to provide the optimum environment by carefully regulating elements such as humidity, temperature, light and other micro-climatic factors.
Our clients wine is stored with industry leading specialist, London City Bond (LCB), who are responsible for 8 million cases in 2,000,000 ft2 of warehouses. Our chosen facility is their Grade 2-listed, Vinothèque facility at Burton-Upon Trent which has provided facilities for the storage of custom-bonded goods since the 19th Century and is a member of UKWA (United Kingdom Warehousing Association).
The dedicated wine storage is operated at the finest conditions for the professional cellaring of fine wines with wines stored and protected to the highest standards guaranteeing the average temperature of 13 degrees Celsius with 60 – 65% humidity, minimal light exposure and strict management of case movements.
As a client of Vin-X, we can arrange a complimentary condition reports with digital photographs of your wine on acquisition and a viewing of your wine at LCB by appointment. Simply contact a member of our team to find out more.
The benefits of storage under bond
The benefits of storing your wine in a Government-bonded warehouse are:
- There is no requirement to pay UK Excise Duty and Value Added Tax on the wine until such time as the wine is removed from bonded storage. If you acquire and sell the wine and it remains under bond these charges will not be triggered.
- If you choose to have your wine delivered out of bond the VAT will become payable on the original price of the wine at time of purchase and NOT its current market value.
- Wines stored in bond are more attractive to prospective buyers including merchants. There is much greater transparency on traceability and provenance with the corresponding certainty that the wines will have been correctly stored to maintain quality and protect value. View our Duty & VAT Charges.
Every case of Vin-X client wine held at London City Bond (LCB) is clearly labelled with LCB’s unique rotation number, the owner’s name and specific wine information.
Once a client has settled an order, the wine is delivered into bond as soon as possible, after which they receive a Certificate of Ownership with the corresponding rotation number. LCB and Vin-X have evolved systems to ensure end-to-end control on the ownership of wine, which is clearly understood to be that of the client, not Vin-X, nor LCB.
LCB is one of the industry’s leading specialist wine storage providers and is responsible for 3 million cases of wine. They operate the highest standards of security with a state of the art system in operation 24 hours a day, seven days a week.
Those clients we arrange storage and insurance for can rest assured that their wine investment is insured at full-replacement value in accordance with LCB’s insurance provider’s terms and conditions.