Trustnet Magazine Issue 9 July 2015 | Page 19

INVESTMENT STRATEGY SPECIALIST INVESTING IN WINE IS A NO-BRAINER AS THE SUPPLY OF INVESTMENT-GRADE WINE IS LIMITED IN VINO VERITAS Investing in wine is a no-brainer as the supply of investment-grade wine is limited and there are more than a million millionaires in China alone who want to drink it, says Peter Shakeshaft, chief executive and founder of Vin-X, a wine investment company. “It’s basic economics,” said Shakeshaft, “while it has had corrections and crashed in 2005, it generally delivers double-digit returns and is very exciting.” Bordeaux is the primary asset – few other regions offer wine of a high enough quality, beyond one in Australia and a handful elsewhere in France (Champagnes and a few in Burgundy), Spain, Italy and California. Jeremy Waud, who runs Waud Wine Club and an investment company, says investors have made serious money and dismisses claims of high maintenance costs of buying premium wine. The fact it is held in a bonded warehouse means wine is not only CGT-free, but incurs no VAT or duty until it leaves the site. He adds any storage costs are minimal and well below what you may expect to see in terms of appreciation in value. “So you can buy two and drink one,” said Waud, “which gives you access to high quality expensive wines at very reasonable prices.” Although funds are available for investing in wine, the other advantage of directly owning it is that your name is on the case in the warehouse and you’re not relying on a firm to make the right decisions or remain in business. “Wine is now a real asset,” said Shakeshaft. “We have Liv-X, a worldwide market for wine, making it open and liquid – pun intended.” COMPARING LONG RUN MEDIAN AND AVERAGE GROWTH BETWEEN FTSE 100 AND LIV-EX WINE INDICES Liv-Ex Investables FTSE100 350% However, cigars to invest in start in the region of £20 up to around £100 per stick, Emery explained, although you need to buy them by the box. Prices have reached the highs of the mid-1980s, but Emery doesn’t consider it a cast-iron investment opportunity: “It’s best if you buy a cigar you enjoy smoking and now and again sell a box,” he said. trustnet.com 300% 250% 200% 244.24% 150% 199% 100% 80.29% 103.15% 40% 36.46% 54% 5 Yr Median 5 Yr Averge 10 Yr Averge 50% 0% 81.77% 10 Yr Averge Source: Liv-Ex & FTSE 17