The latest results of the Wine Investment Challenge show the fine wine market in excellent investment shape.
The Challenge – an investment game run by London wine merchant Robert Rolls for Comic Relief – showed total gains of 36% over a two year period. That compares with 33% for the FTSE100 index.
The game is simple: from a basket of 25 wines, players select a fantasy investment portfolio totalling £10,000. The portfolio showing the best returns over two years is the winner. The prize is £1000 of wine from Rolls’ New Year 2009 wine list.
The results of the 2005 Challenge have just been announced. Over a dozen entrants posted profits of over £3000 each. The outright winner was Jane Moore, based in the US, whose portfolio made £3,589, representing a net gain of 72%.
Her winning selection was for the most part Bordeaux, with a single case of Burgundy – Roty’s 2002 Tres Vieilles Vignes Charmes Chambertin which rose by 43% over the two year period.
Nine cases of the 2003 Leoville-Poyferre registered the biggest net gain of all the wines with an increase of 108%, rising in value from £360 to £750.
Most of the top performing wines also came from Bordeaux, whereas last time around they came from Burgundy. According to Robert Rolls, ‘this very much reflects the market right now where there is so much global demand for classed growth claret both from private individuals and the new wine funds which are beginning to impact on prices at the top end.’
1982 Haut Brion and 1998 Pape Clement yielded gains of 93% and 97% respectively, but others – like the 2003 Montrose, widely regarded as one of the wines of the vintage – made only 2% over the two year period.
Other wines disappointed: 2003 Beaucastel and the 1999 Opus One went down in value by 17% and 8%, JL Chave’s 1998 Hermitage went up 2%, and Roty’s 2002 Gevrey Chambertin 1er Cru Fontenys went up 4%.
That the wine investment market is healthy is borne out by other indices. James Miles of Liv-Ex, the online fine wine exchange, said, ‘It’s incredibly buoyant. Wines on the Liv-Ex 100 are up 11.5% in the last month, having been up 9.2% in April.’
Miles added that the surest investments remained in a handful of blue-chip Bordeaux.
‘It’s all Bordeaux, and all First Growths, and remarkably few vintages. And I know some people will hate to hear this, but they are all wines with 100 Parker points.’
For his part, Rolls stressed that ‘this is a fun competition which gives people the opportunity to play the market without having to risk their own money. And at the same time, it raises some money for Comic Wine Relief. So far, we have already donated over £5000 to the charity.’
The 2007 Wine Investment Challenge is now underway. See below for details.
A longer form of this article appears in the July issue of Decanter magazine, out on 6 June
Written by John Stimpfig, and Adam Lechmere