Fine Wine Investments?

racing_blue

Back to the fundamentals, I don't get it.

Someone grows grapes in France. They crush them and ferment the juice to make wine. This costs them £1. It is a good sunny year, they can sell the wine for £8... that part I get.

But, this is the part I don't get: someone in England decides to invest in wine, s/he buys the Frenchman's wine for £8. S/he hopes that maybe 2 or 3 years in the future, they can sell in for £15.

What magic, what alchemy, tells them that this wine will be worth £15 rather than £4 in 2 or 3 years time?

Why not spend the £8 on shares in Diaego or similar, where at least the future earnings are factored into the price paid per share.

As I said, I don't get it and would be grateful if someone who does get it could explain. Because I love wine, but my ideal investment would not be 1000 cases of of Mersault '07, but a small vineyard in that area, preferably with a swimming pool for the owner's use...

N1AK

racing_blue wrote: »

What magic, what alchemy, tells them that this wine will be worth £15 rather than £4 in 2 or 3 years time?

Why not spend the £8 on shares in Diaego or similar, where at least the future earnings are factored into the price paid per share.

I think for a lot of people it comes down more to:

• Wanting to dabble and try their luck
• Liking wine and thinking they know enough to pick the right choices
• Liking wine and wanting to 'own' it rather than bland old shares
• It's a more 'interesting' investment to talk about

There's nothing wrong with any of those. I keep getting 90% of the way to buying sovereigns and the decision is only partly to diversify, I know that on some level I find the idea of owning gold coins appealing and the idea that I could buy low and sell high attractive. My investments are otherwise quite boring (tracker funds, ISAs etc) which I believe is rational, but who wants to be an entirely rational machine? You'd hardly be much fun at a party!