Fine-Wiine Investing A Lot More Palatable in These Days of Market Turmoil
By Jennifer Waters, MarketWatch
CHICAGO (MarketWatch) -- On a hot, sunny Friday here in September only days after the first Monday market meltdown, two well-heeled wine buyers battled each other at a private auction for the privilege of shattering a world-record price for a single case of 1982 Chateau Lafite Rothschild.
A Chinese buyer who flew in from Beijing for the Hart Davis Hart Co. auction won with a final bid of $54,970 -- a whopping $4,580.83 a bottle. At its release in 1984, a single bottle would have sold for roughly $100.
With the financial markets in turmoil, the sometimes lucrative market of fine wine may appeal to investors, but it's not as simple as stashing bottles in your basement. MarketWatch's Jennifer Waters reports from a Chicago wine auction.
A case of 1990 Romanee-Conti Domaine de la Romanee-Conti that was released at about $500 a bottle sold for $179,250, or $14,937.50 each. A case of 2000 Chateau Petrus was bought for $57,360, or $4,780 a bottle. At its release, the price was $750 a bottle.
Such dramatic price appreciation is not the norm for wine investments, but it does underscore how lucrative and resilient investing in fine wine can be -- particularly so at a time when market volatility is deflating 401(k) accounts and retirement nest eggs, and low interest rates are choking returns on cash and other investments.
"Historically blue-chip wine prices have risen but at a modest pace compared to some other investments," said Allan Frischman, a senior specialist at Hart Davis Hart. "Over the last couple of years these wines have gone up quite dramatically but it's hard to say how long that will keep up."
It's simple supply and demand that is driving up prices. There are scores of new wine drinkers, mostly in emerging economies such as China and Brazil but also in wine bastions like the U.S. and Europe.
CHICAGO (MarketWatch) -- On a hot, sunny Friday here in September only days after the first Monday market meltdown, two well-heeled wine buyers battled each other at a private auction for the privilege of shattering a world-record price for a single case of 1982 Chateau Lafite Rothschild.
A Chinese buyer who flew in from Beijing for the Hart Davis Hart Co. auction won with a final bid of $54,970 -- a whopping $4,580.83 a bottle. At its release in 1984, a single bottle would have sold for roughly $100.
With the financial markets in turmoil, the sometimes lucrative market of fine wine may appeal to investors, but it's not as simple as stashing bottles in your basement. MarketWatch's Jennifer Waters reports from a Chicago wine auction.
A case of 1990 Romanee-Conti Domaine de la Romanee-Conti that was released at about $500 a bottle sold for $179,250, or $14,937.50 each. A case of 2000 Chateau Petrus was bought for $57,360, or $4,780 a bottle. At its release, the price was $750 a bottle.
Such dramatic price appreciation is not the norm for wine investments, but it does underscore how lucrative and resilient investing in fine wine can be -- particularly so at a time when market volatility is deflating 401(k) accounts and retirement nest eggs, and low interest rates are choking returns on cash and other investments.
"Historically blue-chip wine prices have risen but at a modest pace compared to some other investments," said Allan Frischman, a senior specialist at Hart Davis Hart. "Over the last couple of years these wines have gone up quite dramatically but it's hard to say how long that will keep up."
It's simple supply and demand that is driving up prices. There are scores of new wine drinkers, mostly in emerging economies such as China and Brazil but also in wine bastions like the U.S. and Europe.
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