AAA Reports On Growing Appetite for Wine Investment

Dec. 12, 2011 - PRLog -- Boston, MA, December 12, 2011 - More evidence that wine may be the new favourite among alternative investors has been unearthed, according to Alternative Asset Analysis (AAA).

The Alternative investment advocacy and research group claims that Investment guru Michael Spencer’s purchase of a minority stake in "the Goldman Sachs of the wine market", the Bordeaux Index, further demonstrates the asset class’s popularity.

“The fact that many alternative asset classes have become extremely pricey in recent months has meant that the more alternative of alternative assets are now becoming a more valid option for those looking to invest,” stated AAA’s analysis partner, Anthony Johnson.

He added “Although wine is still seen as somewhat of a niche investment market, this is changing rapidly and with high profile moves like this one, involving Mr Spencer, more investors could follow this lead.”

This is not just to do with the relative affordability, however. It is arguably more to do with the fact that wine has performed very well while other more traditional assets have taken a hit. The founder of Bordeaux Index, Gary Boom, said, "If you take wine from when we started measuring in 1983 it has outperformed all the stock exchanges out there. Not by masses, but by one or two per cent a year. The only commodity that has stood up to that is gold."

Wine investment is also an effective diversifier for investment portfolios as it is much less likely to follow the same patterns as equity markets and has a low correlation with general economic trends. One of the major drivers in the wine market at the moment is the increasing demand from China where the population’s increasingly sophisticated tastes are leading to a boom in the market for all things luxurious. Hong Kong has also seen a rise in demand, helped along by the removal of a duty that was previously charged on wine.

Mr Johnson added, “alternative investors can also look at other more alternative alternatives for lower cost options, such as forestry investment products like those offered by Greenwood Management in Brazil. This firm offers people the chance to invest in their own piece of forest from around EUR 10,000."

Contact:
Anthony Johnson
Alternative Asset Analysis
71 Commercial St
Boston, MA 02109-1320
617-939-9596
info@alternativeassetanalysis.com
http://www.alternativeassetanalysis.com