Wines From the Vineyards of Bordeaux Make The Best Wine Investments
Wine Regions & Vintages...
Which properties, regions, and vintages should one invest in?

While one poor choice in drinking wines may result in a ruined dinner date or failed romantic evening, a poor choice in investment-grade wines can be much more costly. Choosing the right properties, regions, and vintages is critical to successful fine wine investing. Bordeaux, Burgundy, Champagne, the Rhone, and Italy are the primary regions that should be considered for fine wine investing. As Bordeaux makes up 90 percent of the wine investment market, wines from this region should make up the majority of any prudent investor’s wine portfolio. Wines from this region are classified by the Bordeaux Wine Official Classification of 1855, a system created for Emperor Napolean III to exhibit France’s top Bordeaux wines during the 1855 Exposition Universelle de Paris. Under this system, wines are ranked from first to fifth growths (crus).

Top Left Bank Classified Growths from within the Bordeaux region are an investor’s first choice, particularly First Growths (Premiers Crus) like Haut Brion, Lafite, Latour, Margaux, and Mouton. These wines are considered to be the top echelon of the blue chip wine sector. Second Growths (Seconds Crus) like Vivens Durfort, Gruau-Laroze, and Pichon Longueville are top choices as well. Many more choices such as Lynch-Bages can be found within the Third, Fourth, and Fifth Growths (Troisièmes, Quatrièmes, and Cinquièmes Crus, respectively).

Choice picks on the Right Bank include Cheval Blanc, Petrus, Le Pin and Auson. Certain vintages of Chateau d’Yquem are also worthwhile.

Moving past the Bordeaux border, Burgundy wines can prove to be worthy fillers of your portfolio’s minority holdings. Names to keep an eye out for include Coche-Dury, Comtes Lafon, De Vogue, and Domaine de la Romanee-Conti. New investors should be aware that the secondary market for Burgundy is much smaller due to its relatively undeveloped status. The same holds true for wines from the Rhone Valley, where wines like Cote Roties sometimes yield good returns but carry the risks of coming from an undervalued region that has not yet to build a reputation amongst wine investors.

The Champagne region is also known for its investment success. Champagnes like Crystal, Dom Perignon, and Krug often achieve extremely high prices at auction even when compared to red Bordeaux.

The above-mentioned regions are the preferred locations for most investors. Investing outside of France is much more risky. Italian and Spanish wines have been known to perform well at times. Even Californian and Australian wines have periodically been sought after by investors within local markets. There are problems with these wines, however. Very few of them have proven, long-term aging potential. A shortage of them significantly slows the development of a secondary market as well.

There are mixed feelings about investing in Port, too. Although certain popular names like Croft, Fonseca, Graham, Quinta do Noval, Ramos Pinto, and Taylor provide lower cost alternatives to their Bordeaux and Burgundy counterparts, their profitability almost never matches them even after long cellaring. As a result, it is not uncommon to hear wine investing experts suggest purchasing these wines for drinking rather than for investment.

So-called “Cult” wines, or wines that command high prices from a dedicated group of enthusiasts, should be avoided. Among these wines are names like Penfolds Grange, Galardi Terra di Lavoro, and Screaming Eagle. These wines are typically very expensive and are produced in very limited quantities. They are often seen as trophy wines due to their hefty price tags despite whatever quality they may or may not have. They are subject to the whims and wishes of their followings and, although they may seem to follow the Bordeaux Investment market, are highly unstable choices for investment purposes.

The same goes with “garagistes,” or garage wines that emerged in the mid-1990s as a result of a rebellion against the traditional wine-making methods used in the Bordeaux region. The Garage Movement enjoyed a modest heyday in the late 1990s but, being
at the mercy of faddishness and changes in fashion, have continued to lose steam since early 2004. As new, modern, untested brands, they are unestablished when compared to their blue chip counterparts. Although they receive great reviews for their “drinkability,” investors are advised to steer clear.

When it comes to choosing the right vintage, it is best to stick to great “trophy wines” from Bordeaux. This includes First Growths, top Pomerols, and St. Emilion.

The best Bordeaux vintages for these wines are as follows:

1959, 1961, 1982, 1989, 1990, 1996, 2000, 2005, 2008, and 2009

Poor vintages should be avoided unless they come from a top First Growth.