Fine wine has emerged as the better performing asset class over the past 15 years. While global equities have been under pressure, fine wine has been solid as a rock.
The Liv-ex 100 and Liv-ex 1000, which provide the broadest exposure to the secondary market for fine wine, have risen by 213.9% and 258.2%, respectively. By contrast, U.S. equities have gained a lower 143.9%, and U.K. equities, merely 59.2% over the same period. Asian equities have also lagged behind.
As the chart below shows, fine wine has also managed to build upon its existing gains in the past year. The industry benchmark, the Liv-ex 100, has been very steady. The index is up 0.22% year-to-date and has outperformed the FTSE 100, DAX and Hang Seng. Furthermore, it has experienced none of the volatility witnessed by global equities, and instead has traded within a 2% range throughout 2018.
The Liv-ex 1000, the broadest measure of the market, has additionally outperformed U.S. equities. The index reached an all-time high this year after rising 10.2%. The main driver behind this impressive growth was the Burgundy 150 index, which had its best year in a decade, gaining 35.5%. The Liv-ex 1000, which is 26% weighted to Burgundy, was thus boosted by the region’s strong gains.
With several significant milestones reached this year, the fine wine market enters 2019 in good health, offering steady returns and low volatility compared to other mainstream assets.
Readers should take note that the views of this author represent those of a company with an interest in the wine trade. Liv-ex operates the global marketplace for fine wine. It offers trading, data and settlement services to professional buyers and sellers of fine wine. Private collectors can view Liv-ex prices and value their portfolios using Cellar Watch and find regular market analysis on the blog. The opinions of Liv-ex are their own and do not represent those of Robert Parker Wine Advocate or Wine Journal. Liv-ex contributes articles to Wine Journal that we feel are of market relevance to readers, but we do not specifically endorse this company.