Wines From the Vineyards of Bordeaux Make The Best Wine Investments
Tricks of the Trade...

Investing in wine can be risky business for uninitiated. Get a clue and save yourself the headache by following a few of these simple tricks of the trade:

1. Caveat emptor. Only a fool would ignore the the old adage “buyer beware” as a tired, outdated cliche. Even though the term remains in Latin to this very day, the very reason why this advice has been carried on for centuries is simple--fraudsters and scammers still continue to exist now just as they had when the phrase was first coined. Considering wine investing may be a new and risky venture for some, it is even more important to inspect the wines you intend to buy to ensure they are exactly as advertised.

Check your wines for counterfeits and contaminants. Refuse pressure from dodgy salespeople to buy bad vintages. Avoid fly-by-night investment companies that charge excessive handling and processing fees. Double check the taxes and duties are the proper amounts. Much of this is applicable to any consumer good you would purchase, but it certainly doesn’t hurt to be reminded again as a precaution.

2. Go East, Young Investor. Take heed of the Asian market. It was not a random or whimsical decision when Chateau Lafite Rothschild placed the Chinese symbol for lucky number ‘8’ on its 2008 vintage. The Asian market takes luck and superstition very seriously, as it is an integral part of their society and heritage. Anytime a merchant makes a delibrate change to their product to accommodate an emerging market it is neither a fluke nor an arbitrary decision, but a careful move to increase its customer-base. Winemakers’ awareness of this shows they are paying attention to the growing customer base in the Far East. Follow their lead and keep an eyeball on the Orient.

3. Diversify, diversify, diversify! As with other investments, spreading your risk amongst multiple choices helps reduce your risk. Balance your portfolio with select bottles from various regions and vintages. Make sure you invest enough money to adequately diversify.

4. Quality, not quantity. Try to aim for a small number of high value items rather than tons of cases of modest wines that add up to the same value, as high-scoring trophy wines tend to be more profitable. With a smaller number of high value items, you also reduce storage and transportation costs.

5. Do your homework. Don’t just take the advice of a single authority. Read more than one source for your desired wine subject. The following list is a good place to begin your research:

Decanter Magazine (decanter.com) - Self-described as “the world’s best wine magazine,”, Decanter Magazine truly is a wealth of knowledge about all things made from grapes. The magazine is read in over 98 countries, with their experts recommending over 4,000 wines a year.

Robert Parker (eRobertParker.com) - If the wine industry were a constitutional monarchy, Robert Parker would be its ceremonial emperor. With everyone in the game from prince to pauper abiding by his every ruling, Parker single-handedly changes the direction of wine-making enterprises on a daily basis. Based at his modest micro-winery stronghold, the Beaux Frères, near Newburg, Oregon, Parker samples over 10,000 wines a year. It is his 100-point scale of Parker Points that ultimately decides how much a wine will command on the open market.

Jancis Robinson (jancisrobinson.com) - World-class wine communicator Jancis Robinson literally wrote the book on wine. She is co-author of The World Atlas of Wine as well as editor of The Oxford Companion to Wine. She writes for her own website as well as a bi-monthly column in The Financial Times. Even Robert Parker recommends the member’s only section of her website, The Purple Pages, where the Companion, Atlas, thousands of wine reviews, and active user forum can be found.

Steven Spurrier (http://www.thewinesocietyofindia.com/wine-blogs/steven/) - Another noteworthy wine expert, Steven Spurrier has frequently been referred to as the champion of French wine. Originally from Britain, he is a former Paris merchant who founded the Academie du Vin and the Christie’s Wine Course. He is a consultant editor for Decanter Magazine and Chairman for the Board of Wine Advisors, The Wine Society of India.

Liv-ex (liv-ex.com) - Liv-ex is an electronic marketplace for trading fine wine. Their website contains recent new, analyses, and other information for both merchants and collectors alike. Their famous Liv-ex 100 and Live-ex 500 indices can be tracked here as well. This is one website wine investors will want to review on a regular basis.

Berry Bros. & Rudd (bbr.com) - Berry Bros. & Rudd is Britain's oldest wine and spirit merchant, in business at the same location for over 300 years. Officially established in 1698, the company originally began dealing in provisions, exotic spices, tea and coffee. Now they deal predominantly in wine sales, even providing fine wines to the British Royal Family. Their website contains a comprehensive knowledgebase of wines as well a full calendar of upcoming wine-related events.

The Wine Doctor - (thewinedoctor.com) - Written solely by Chris Kissack, this online resource originally began in May 2000 as a consumer blog and has grown to become a professional wine resource worthy of consultation.

6. Do more homework. For the studious type, reading wine from an academic perspective may be a worthing undertaking. Try reading Mahesh Kumar's book “Wine Investment for Portfolio Diversification,” published by The Wine Appreciation Guild. Another good reference is “Investing in Liquid Assets – uncorking profits in today's global markets” by David Sokilin and Alexandra Bruce.

7. Live it up. Liv-ex is your friend. Visit liv-ex.com and check out the various wine investment indices and market updates it has to offer.

8. Take charge. Purchase your wines with a credit card. Not only will you accumulate bonuses your particular card has to offer, but you will take advantage of your credit card company’s insurance and the various consumer protections the law has to offer.

9. Don’t buy into the cult. Avoid cult wines and garagistes. Period.