Investing in Bordeaux wine is a great place to start when building a wine collection.
You love to drink great wine. And, as the years have gone by, you have naturally—and, perhaps, deliberately—developed a more discerning palate. You might even go so far as to call yourself an oenophile: you’re devoted to learning more and have grown to appreciate how wine is produced. You also put careful consideration into how, where, and when the wine you purchase is consumed. The next step as a true connoisseur is to build a wine collection—both for your future enjoyment and to provide the option of selling some bottles for a profit. Investing in Bordeaux wine is a great place to start.
Why You Should Invest in Bordeaux Wine
There are good reasons why Bordeaux wine is a popular investment among serious collectors. The Bordeaux region itself is known for producing high-quality blends that command equally high prices, especially in the case of estates ranked highly in the classification of 1855. Since the best Bordeaux wines are meant for aging, the worth of these wines also tends to rise as they mature.
Bordeaux’s reputation for producing fine wine reaches all the way back to the first century. It’s this consistent quality coupled with the potential for increased value over time that has confirmed the status of Bordeaux wine as one of the most valuable and commonly traded wines in history.
There are even more practical reasons for investing in Bordeaux wine as well:
- Financial analysts and advisors routinely recommend that investors not rely heavily on the performance of a single asset. Including wine in an investment portfolio is one way to diversify your assets, which is key to minimizing risk and safeguarding healthy overall future returns.
- As an asset class, fine wine yields higher net returns than art, rare stamps, and bonds—even after expenses, such as storage fees, are accounted for. In fact, according to research published in the Journal of Financial Economics, first-growth Bordeaux wine has a return on investment of 4.1 percent.
- A wine’s value is largely affected by its potential for aging and how far it is from its peak—not by the stock market. Stocks rise and fall, but even the most affordable examples of first-growth Bordeaux wine will hold—and likely increase in—value with time.
How to Choose Your Bordeaux Wine Investments Wisely
Obviously, not all Bordeaux wines are created equal when it comes to adding value to a portfolio. The region, producer, and vintage influence the quality of a wine and will naturally affect your purchasing decisions. Keep the following in mind as you make investments in Bordeaux wine:
- Consider the sub-region. Within the Bordeaux region, there are more than 30 sub-regions and 60 appellations. To keep things at first, focus on building your Bordeaux wine collection from those areas famous for producing some of the world’s most prestigious wine:
- Médoc and Graves: Situated on the left bank of the Gironde Estuary, these areas include the renowned sub-regions of Margaux, Pauillac, Pessac-Leognan, Saint-Estèphe, and Saint-Julien.
- Libournais: Pomerol and Saint-Émilion are two of the most famous appellations located in this Right-Bank region.
- Consider the producers. Some estates have an exceptionally long-standing and well-deserved reputation for consistently producing high-quality Bordeaux wines that are ideal for laying down. These wines develop more complex flavors with time and their value reliably increases with age. Some of the top estates include:
- First-Growth Producers: Château Haut-Brion, Château Lafite Rothschild, Château Latour, Château Margaux, and Château Mouton Rothschild. Each of these estates is classified as first growth. As such, they produce some of the most expensive wine in Bordeaux.
- Top Second-Growth Producers: Château Cos d’Estournel, Château Ducru-Beaucaillou, Château La Mission Haut-Brion Château Léoville-Las Cases, Château Léoville-Poyferré, Château Montrose, Château Pichon Longueville Baron, and Château Pichon Longueville Comtesse de Lalande. These estates are considered Bordeaux super seconds; their wines are more reasonably priced than those of first-growth estates, but they still make fantastic investments.
- Consider the vintage. A Bordeaux wine’s vintage will also influence your decision to invest. Accomplished estates like those listed above will dependably produce excellent wine, but the year a wine is produced still affects quality, especially when it comes to ageability. Below are five recent and older vintages that were exceptional for both the left and right banks:
-
If you’re considering other vintages, seek out reviews by reputable wine critics such as Master of Wine Jancis Robinson and Robert Parker of Wine Advocate. Look for reviews of the specific producer and label you’re considering, in addition to the vintage, in order to get the most accurate prediction of aging potential.
Where to Begin Your Bordeaux Wine Collection
As a new wine investor, your initial purchases will likely be driven by your preferred time horizon for drinking or selling. The length of time you’ll need to lay a bottle down before it—and, thus, your investment—matures varies from vintage to vintage. Reading up-to-date tasting notes and reviews by professional critics and even serious amateur collectors can provide insight into whether a bottle is ready to open or put on the market. Of course, as with any great wine, you’ll have to be willing to wait. A good Bordeaux vintage will benefit from at least ten years of aging and the finest vintages can be held for many decades. Investing in Bordeaux wine is a rewarding way to build a portfolio of assets that will grow in value over the long-term.
Whether you are starting your high-end wine collection or adding to an established portfolio, Vinfolio is your partner in buying, selling, and professional storage. Contact us today to get access to the world’s finest wine.
-
