In times of economic uncertainty investors traditionally turn to safe havens with Gold the classic ‘go-to’, but it is important to note that Gold’s 14% 1H 2020 growth is matched by the top performing fine wines.
The yellow metal saw record highs in July, achieving values not seen since September 2011, approaching US$2,000. Commentators have pointed to a current ‘shortage’ of physical gold due to previous mine closures and Covid-19 impacting mining productivity, influencing performance driven by investors seeking sanctuary in troubles times. As we all know, investment in tangible assets should also be diversified and fine wine offers an important opportunity to enhance performance and spread risk in a balanced portfolio.
The top performing fine wines on Liv-ex matched Gold’s 14% growth in the first half of this year as can be seen in the table below.
Liv-ex Top Performing wines 1H 2020
|Region||Wine||Vintage||Price at 01.01.20||Price at
|Champagne||Pol Roger, Winston Churchill||2002||£1,590||£1,796||13%|
|Champagne||Louis Roederer, Cristal Rosé||2009||£3,600||£3,950||10%|
|Italy||Giacomo Conterno Barolo, Riserva Montfortino||2000||£8,268||£8,964||8%|
|Champagne||Premier Jouet, Belle Epoque||2008||£1,692||£1,824||8%|
Source: Liv-ex.com July 2020
Notably, Italian and Champagne wines featured strongly in the highest price risers and also in terms of market share on Liv-ex in the first half of 2020. Growing demand by investors for the top wines of these regions has been further enhanced with their exemption from Trump’s tariff increase in 2019. The quality and value of these wines is now well recognised and including Super Tuscans, rare Barolos and top vintage Champagnes are now an essential to ensure that a fine wine portfolio is diversified to deliver best possible returns.
Top Fine Wine Market Movers in June 2020:
|Region||Wine||Vintage||Price at 31.05.20||Price at 30.06.20||1-month performance|
|Champagne||Moet & Chandon, Dom Perignon Rosé||2006||£1,903||£2,126||11.7%|
|Champagne||Pol Roger, Sir Winston Churchill||2002||£1,575||£1,738||10.3%|
|Champagne||Louis Roederer, Cristal||2005||£1,280||£1,410||10.2%|
|Champagne||Louis Roederer, Cristal||2004||£1,730||£1,894||9.4%|
|Champagne||Moet & Chandon, Dom Perignon||2003||£1,140||£1,230||7.9%|
Source: Liv-ex July 2020 (Mid-price 12 x 75cl)
Champagne, in particular, enjoyed an effervescent June 2020, despite lock-down, with the region accounting for the top price performing wines that month. Thirty-nine of the fifty wines that make up the Liv-ex Champagne 50 index saw price rises in the month.
On trend, as opposed to individual wines, Liv-ex reported in its July Trade Report that fine wine continues to outperform challenged financial markets – more information in our upcoming Fine Wine Market Report – and with a performance that stands well against gold, investors should consider fine wine as an important asset to diversify portfolios. Understanding the tax advantages offered is also important – download the Vin-X Report on the Tax Treatment of Fine Wine in 2020 for current information.
To get an update on which wines you should be adding to your collection contact us now on 0203 384 3362 and speak to one of our expert portfolio managers.