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What are the benefits of investing in fine wine?

Wine barrels in cellar

Fine wine has evolved from a niche passion into a recognised alternative investment asset, attracting collectors, high-net-worth individuals, and professional wine investors alike. While many are initially drawn in by the romance and heritage of wine, the financial case for buying wine for investment is compelling in its own right.

Unlike traditional financial markets, fine wine offers a combination of strong historical performance, low volatility, and tangible value. It also benefits from unique structural factors – finite supply, rising global demand, and favourable tax treatment – that are rarely found together in other asset classes.

Below, we explore seven key reasons why fine wine deserves serious consideration as a long-term investment and portfolio diversifier.

A high-performing asset class

Fine wine has been one of the strongest-performing alternative assets over the past three decades. Since January 1988, the compound annual growth rate of leading fine wine indices has averaged around 12.6%, outperforming many mainstream assets over the long term.

Notably, fine wine has demonstrated resilience during periods of market stress. During the Covid-19 pandemic, while equities experienced sharp volatility, fine wine prices continued to rise. In 2021, the fine wine market delivered record-breaking performance, surpassing global equity benchmarks.

Even more recently, the contrast remains striking. Over the past year, the Liv-ex 1000 index – the broadest measure of the fine wine market – rose significantly, while major indices such as the FTSE 100, S&P 500, and Nasdaq either lagged or declined. For long-term investors seeking steady appreciation rather than short-term speculation, fine wine has proven its credentials.

Tangibility and intrinsic value

One of fine wine’s most attractive features is its tangibility. Wine is a physical, tangible moveable property – often referred to legally as a chattel – rather than a paper asset or digital entry.

Unlike shares or cryptocurrencies, fine wine does not disappear in a market crash. It exists independently of financial systems, monetary policy, or central bank decisions. This intrinsic value places it in the same category as other tangible assets such as art or property, but without the high maintenance costs, regulatory burdens, or reliance on a single national economy.

Additionally, fine wine is globally traded through established wine merchants and international exchanges, making it far more liquid than many people assume.

A stable, low-risk investment

Fine wine has historically exhibited low volatility compared to equities and commodities. Prices tend to move gradually rather than reacting sharply to short-term news or sentiment.

As a physical asset with proven demand, fine wine has also acted as an effective hedge against inflation and economic uncertainty. During periods of rising prices or recession, investors often rotate into real assets with limited supply – an environment in which fine wine has consistently performed well.

For investors prioritising capital preservation alongside growth, this stability is a key advantage.

Finite supply and rising demand

Investment-grade wine is fundamentally scarce. Each wine is produced in limited quantities, tied to a specific vintage, and subject to strict production rules. Once bottled, supply can only ever decline as wines enter their drinking windows and are consumed.

At the same time, demand continues to grow. The global fine wine market has expanded beyond its traditional European base, with increasing participation from Asia, North America, and emerging wealth centres. This imbalance – finite supply paired with rising demand – is a powerful driver of long-term price appreciation and is relatively unique within the wine industry.

An effective portfolio diversifier

For investors looking to diversify their portfolios, fine wine offers a compelling solution. Numerous studies have shown that fine wine prices have little correlation with traditional financial markets such as equities and bonds.

This low correlation means that when stock markets fall, fine wine often holds steady or even appreciates. As a result, wine investors use fine wine to reduce overall portfolio risk while maintaining return potential.

In an era where traditional diversification has become harder to achieve, alternative assets like fine wine are playing an increasingly important role in long-term wealth strategies.

Tax efficiency and CGT exemption

Fine wine also benefits from favourable tax treatment in many jurisdictions. In the UK, most fine wine qualifies as a “wasting asset” with a predictable life of less than 50 years, making it exempt from Capital Gains Tax (CGT) when sold.

This wasting asset exemption – sometimes referred to as the chattels exemption – means that when investors sell their wine, gains are typically exempt from CGT. Importantly, fine wine is also not subject to income tax, provided it is held for capital appreciation rather than trading as a business.

While fortified wines may fall outside this exemption due to their longer lifespan, the vast majority of investment-grade wines benefit from this tax-efficient structure, allowing investors to retain more of their returns over the long term.

Passion investment

Finally, fine wine occupies a rare space where financial return and personal enjoyment intersect. Many wine investors are drawn to the market through their interest in wine itself, only later recognising its investment potential.

Unlike most assets, fine wine offers a unique optionality: you can buy, hold, sell your wine – or drink it. Even in the unlikely event that market conditions change, the asset still delivers intrinsic enjoyment, reinforcing its appeal as a passion investment.

Working with a reputable wine merchant ensures proper storage, authentication, and market access, allowing investors to participate professionally while remaining connected to the culture and heritage of wine.

Final thoughts

Fine wine is no longer simply a collector’s indulgence. It is a proven, long-term investment asset with a strong track record, tangible value, low volatility, and compelling tax advantages. For those looking to diversify their portfolios, protect wealth, and invest in something with real-world substance, buying wine for investment offers a rare combination of performance and pleasure.

As global demand continues to grow and supply remains finite, fine wine’s role in sophisticated investment portfolios is only set to expand.

Ready to get started now you know more about investing in wine? Speak to one of WineCap’s investment experts to discover the next steps on your wine journey.

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Seven Delicious Reasons to Invest in Fine Wine

Wine rack

As alternative assets go, fine wine is one of the most vibrant and exciting on the market. Not only does it add depth and passion to an investment portfolio, but it can deliver extraordinary returns too. Experts recommend allocating between 1 – 2% of an overall portfolio to this intriguing asset class[1]. And among the super wealthy high net worth individuals, the proportion is anticipated to be even higher[2].

Here are seven compelling benefits to consider investing in fine wine:

1.   Impressive potential for returns

Investors should always remember that there are no guarantees, and historical returns do not mean future ones. But it’s hard to ignore the impressive and steady performance of the fine wine markets.

Overall, the fine wine market has enjoyed a compound annual growth rate (CAGR) of 12.6% since 1988[3]. Another report by Knight Frank that fine wines had increased in value by a staggering 127% over the past decade[4]. And it’s showing no signs of slowing. Already within the first months of 2022, fine wines outperformed all other major markets, except commodities[5]. What’s more, experts are optimistic for the future. Burgundy wines and Champagne have particularly flourished over recent months. And – as adverse weather and climate change impacts the creation of new wine[6] – these vintages are likely to become ever more sought-after.

2.   Powerful inflation-beating properties

Today’s market is overheating. And as central banks frantically increase interest rates in a bid to slow down inflation, it shows no sign of cooling. In May 2022, the Bank of England warned Britain to brace itself for inflation levels to rise above 10% – the highest since 1988[7]. This leaves traditional stocks and bonds investors feeling nauseous. The markets are staggering, with cash and debt instruments on the edge of plummeting.

Meanwhile, those assets such as gold, art or fine wines which have inflation-beating properties are in demand. This could make it an excellent choice for concerned investors.

3.   An exceptional diversifier

Nobel Prize laureate, economist Harry Markowitz famously quipped that diversification is the only “free lunch” in investing[8]. This is the process of spreading wealth across many different investments to take advantage of market opportunities while shielding against turbulence. Diversification doesn’t just mean investing in different asset types, sectors, or geographical locations though. Crucially, it also means investing in assets with different income sources and value drivers. Or to put it another way, the value of some assets should be uncorrelated to the stock market.

This is often a stumbling block for investors. How can you invest in an asset that’s uncorrelated or even negatively correlated to the stock market? Whether it’s tech companies in the US, or renewable energy plants in Europe, most assets are all impacted by the same market events. However, fine wine is different. The value of fine wine is determined by a completely unrelated set of criteria to publicly-traded stocks or bonds.

Some of these value-drivers are unique to the bottle. The wine-making technique, region, weather, year, packaging, storage, age and more all play a part. While the supply and demand factors are generally kept within a niche and exclusive circle of connoisseurs. This makes fine wine a truly exciting diversifier, akin to art. During the 2020 pandemic and recession, for example, the value of fine wines increased by a whopping 13%[9]. This highlights a powerful negative correlation to the wider market performance.

For forward-thinking investors, fine wine could just be the strategic hedge against market volatility they’ve been looking for.

4.   A refreshingly tangible investment

In a world filled with bitcoin, the metaverse and crypto-assets, an investment you can touch is a breath of fresh air. Physical assets like gold, property, or fine wines can feel extremely reassuring during periods of market turbulence – which becomes reflected in their value.

Tangibility is one of the most significant benefits and differentiators of fine wine as an asset. While the costs of storage and insurance can eat into returns, it’s a small price to pay for the durability of the asset. After all, companies can collapse, rendering their shares and stock options useless. Inflation can eat away at cash or debt. And companies or governments can default on their loans, and file for bankruptcy. Electronic shares are only real if they exist on a screen.

But, regardless of the economy outside, a premium bottle of fine wine still be there. It will still be a desirable and solid asset which becomes better and rarer over time.

5.   Fine wine is exempt from Capital Gains Tax

Fine wine falls into a curious tax bracket. As it is deemed by the HMRC to have a useful economic life of 50 years or less, it’s known as a “wasting chattel” or a “wasting asset”. While this may not sound flattering to the purveyors of fine wines, this unsightly name is really a blessing for investors. It means returns from these assets are free from costly Capital Gains Tax (CGT) – currently set at 20% for all annual income after £12,300.[10] This is a major benefit of fine wines and can seriously boost returns for investors.

If the wine is considered to have a life of more than 50 years, some CGT may apply, but it’s still somewhat shielded from the full hit. Tax is payable only for returns of more than £6,000. This is a significant perk for investors which could more than compensate for storage and insurance costs. Find out more about fine wine taxation.

6.   More room for price negotiation

More than one million trades[11] are made on the London Stock Exchange every single day. With so many people jostling to buy and sell shares, this makes the public investment markets extremely efficient. Whatever price a stock has at any moment of time is probably exactly what it’s worth, according to thousands of investors. Because of this, it’s almost impossible to get a bargain in the short-term. Instead, investors need to buy at a pre-determined price and wait until the asset appreciates or depreciates.

With fine wine, the process of buying and selling is completely different. And unless, you’re investing with an index fund or something similar, you’ll likely find yourself at exclusive auction houses or negotiating a sale privately. Just like buying a property or bidding online, this opens the possibility of getting a better price than you expected.

7.   Support a much-loved industry

It’s no coincidence that fine wines are known as “passion assets”. Investors who want to do more than simply generate financial returns often turn to this unique world because of its vibrant industry and exclusive inner-circle.

Being part of this group of investors means supporting a sector steeped in history and culture. It means putting value on true quality and appreciating some of the finest craftsmanship in the world. It is the only asset class that you can sip and savour, bringing exquisite flavours and exceptional taste to your portfolio.

Interested to learn more …?

Incorporating fine wine into a diversified investment portfolio could be a tasteful way to; boost returns, enhance diversification, shield against inflation, benefit from tax perks and even support an industry steeped in culture. If you’d like to learn more about the fascinating world of wine investments, download our complimentary guide.

 

[1] Source : Honest Grapes

[2] Source : Alt Class

[3] Source : Liv-ex

[4] Source : Knight Frank

[5] Source : Liv-ex

[6] Source : The Drinks Business

[7] Source : The Guardian

[8] Source : NetWealth

[9] Source : Knight Frank

[10] Source : HMRC

[11] Source : Statista

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E. Guigal Buys Château d’Aqueria

Exterior of chateau d'acqueria

The esteemed northern Rhône producer E. Guigal has acquired Château d’Aqueria in Tavel, one of the jewels of the southern Rhône. The celebrated maison made the purchase from the de Bez family and the estate spans 242 hectares with 168 under vine. Some 100 acres are in Tavel with the remainder in the neighbouring Lirac appellation.

This isn’t Guigal’s first purchase in the southern Rhône; the maison bought Domaine de Nalys – now Château Nalys – five years ago. It had previously sourced grapes from there over the course of three centuries for its négociant arm.

Château d’Aqueria dates back to 1595, when Louis Joseph d’Aqueria purchased the land for grape growing. The estate has been bought and sold over the centuries and, most recently, Paul de Bez’s sons, Vincent and Bruno, were in charge of it until this new purchase. 

The Tavel appellation lies just across the Rhône river from Châteauneuf-du-Pape and spans some 933 hectares. The region is famous for producing complex and deeply coloured rosé wines from primarily Grenache and Cinsault grapes, with Syrah and Mourvedre supporting. Tavel rosé must have at least 11% alcohol which renders it suitable for ageing.

The estate produces approximately 16,000 cases of wine each year and it will be kept by E. Guigal as a separate domaine, aside from the négociant arm. 

Lirac is gaining more and more interest recently as Châteauneuf-du-Pape lovers look to this region which shares a similar terroir. Producers from Châteauneuf have been buying vineyards here and making more accessibly priced white and red wines from old vines. 

Philippe Guigal, winemaker and CEO, said that the team is ‘eager to make its contribution to Château d’Aqueria’ and that its first project will be to ‘drive forward the practice of biological-ecological viticulture, with the help of the existing team at the Château.’ 

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Bordeaux En Primeur 2021: Initial Thoughts

Angelus-Bottle

The Bordeaux En Primeur 2021 campaign is set to begin this quarter. Critics and the wine trade have descended – in person this year – on the famous French wine region to taste samples of last year’s vintage which will be sold as new releases while the wines are still in barrel.

Performance isn’t just about how good a wine or a vintage is though, growth can be seen across the spectrum. For instance, Château Lafite Rothschild 2013 (Neal Martin, 90 points), is up 110% since release, Carmes Haut Brion 2012 (Antonio Galloni, 94 points) is up 160%.  Younger wines haven’t had the chance to move as far yet, but there are still good numbers to be found: Château Beychevelle 2017 is up 30% and Château Pontet-Canet 2019 45%

Initial Thoughts on the Bordeaux 2021 Vintage

After speaking with winemakers, the négociants who sell the wine, journalists and other members of the trade, the general opinion is that 2021 is a fresh and approachable vintage that’s good quality and that many remarked is similar to other cooler years. WineCap will make a full assessment of it once critics’ scores and release prices are out in the next quarter. 

2021 was a more challenging year than each of the three vintages that preceded it. January started off mild but with some heavy rain. Temperatures were cooler than normal which helped create wines with a fantastic freshness to them with lower alcohol levels. Many producers experienced frosts in April and May. However, some châteaux weren’t affected at all due to their terroir’s elevated topography, as is the case with Pomerol’s Troplong Mondot which had almost no loss of yield. Rain in mid August and September helped promote downy mildew in the vineyard which affected grapes, although this wasn’t a problem for all châteaux. Merlot was the most affected grape as it is an early ripener and is also the most prone to suffer from mildew. This meant that production levels were down, as rigorous sorting in the vineyard allowed only the finest grapes to be used. Many producers on both the Left and Right Bank held off harvesting until as late as possible in the hope of warmer weather to ripen grapes a final bit more. This paid off as those who waited were rewarded with sun and higher temperatures. 

New Technology Helping Create the Best Bordeaux Wines

Producers now have excellent technology at their disposal to help them identify and select the finest grapes possible. In 2021, many châteaux used optical sorting machines that have cameras and/or lasers to determine grapes’ colour, size, structure and chemical composition. Another technique that was employed last year and that is gaining more and more prominence is density sorting. Grapes are bathed in a sugar solution at a sweetness level the winemaker desires. Ripe grapes that meet the desired sugar level sink to the bottom. These methods are enabling winemakers to create fantastic wines even during a challenging vintage. 

Of course, while these machines are gaining more popularity, the hard work begins in the vineyard: taking care of the vines and hand sorting grapes there before further quality control can take place in the winery. Château Pontet-Canet in Pauillac is the posterboy for good vineyard management and – in particular – biodynamic practices as it retained most of its yield in 2021 as it was prepared for inclement weather.  

2021 appears to be continuing a trend of fresher wines that are approachable earlier, while still having the potential to be able to age for decades to come.

Left Bank Bordeaux

As with many of the Bordeaux wines we tasted regardless of appellation, the Left Bank producers were happy with their wines, despite not having been able to make as much of them as they’d like. Pessac-Léognan’s Château Haut-Bailly and Saint-Julien’s Château Beychevelle were textbook examples of the 2021 vintage, delivering fantastic freshness, purity of fruit and fine tannins.

Right Bank Bordeaux

What stood out in Saint-Emilion and Pomerol was the higher percentage of Cabernet Franc used in the 2021 blend, typically with Merlot, as it is a late-ripening grape. Château Angelus’ 2021 Grand Vin contains the highest amount of Cabernet Franc on record: 60%. This gives the wine fantastic freshness and soft tannins. It was a similar story for many producers on the Right Bank, with higher levels of the grape used than usual. 

The Outlook for Bordeaux En Primeur 2021

While we eagerly await the release prices and critics’ scores that will appear during this quarter, the general opinion is that the 2021 vintage has produced fresh, approachable wines that are good quality. With yields down significantly in the case of some châteaux, we can expect there not to be as many bottles released as in previous years. Therefore it’s reasonable to expect that producers won’t be pricing these En Primeur wines at a discount. As always, it’s a question of individual châteaux prices.

Want to keep up-to-date on the Bordeaux 2021 En Primeur campaign? Sign up here to receive the latest news and releases.

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Rare Burgundy Auction at Christie’s

christies auction

Rare Burgundy wines are set to feature in Christie’s upcoming ‘Luxury Week’ in May and also in its Finest and Rarest Wines and Spirits sale in June. Spring heralds warmer weather, new growth and for one of the world’s most famous auction houses, a series of auctions that include some of the finest wines, watches, jewellery and handbags ever produced.

Christie’s Auction House 

Last year’s sales of luxury items at Christie’s was incredibly successful, topping just over $980m and the highest since 2015. Interestingly, 35% of buyers across all categories were new to the business and 32% of them were millennials, according to Christie’s CEO Guillaume Cerutti. It’s these new buyers that are driving the current buoyancy at the top end of the luxury auction market and that continue to push prices up on rare, collectible wines. What’s more, Christie’s has heavily invested in technology, a move brought about by the pandemic, in order to livestream auctions.  

All eyes will no doubt be focused on the upcoming rare Burgundy auction in June. It’s sure to be a real highlight as all of the 45 lots have been brought above ground from the deep, vaulted cellars of King’s College Cambridge. King’s College is said to have one of the most well respected cellars out of all of the university colleges and a real heritage when it comes to wine as its University Wine Society was founded in 1792. The college bought all of the wines on release from UK importer Richards-Walford and the cases were then moved to the university’s cellars, where they have remained since then. Only four wine stewards have been appointed in the past two centuries and their enviable role is to act as the cellar’s guardians and curate its collection.

A Wine Investor’s Dream

The 45 lots are set to feature rare Burgundies from such highly sought-after producers as Henri Jayer and his nephew Emmanuel Rouget, who is now the proprietor of some of Jayer’s most famous vineyards. Wines from these producers are expected to hail from such revered appellations as Echézeaux and Vosne-Romanée Cros Parantoux. Bids are sure to reach eye-wateringly high amounts for stand-out wines from a region that has tiny production levels.

Speaking about the upcoming auction, Adam Bilbey, Christie’s Global Head of the Wine and Spirits Department commented: “The hallowed cellars of King’s College, Cambridge are steeped in such history and tradition that this sale will garner the imagination and attention of wine lovers around the world. This small glimpse into the King’s College cellar will most certainly be a highlight of Christie’s wine sales this season”.

Want to find out more about rare Burgundy wine? Download our Burgundy report and discover why the region and its producers’ wines command some of the world’s highest prices.

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Q1 2022 | Report

Global markets illustration

 

Our first quarterly report, analysing the trends that shaped the fine wine market in the beginning of the year, is now available to download. The report examines how the global situation has impacted fine wine’s performance and the regions, producers and wines to follow.

The fine wine market was keenly poised at the beginning of the year after a record-breaking 2021. This helped it brave the volatility that traditional assets failed to withhold. Fine wine indices continued to rise despite slowing GDP growth, high inflation and the turmoil brought by Russia’s war with Ukraine. Burgundy, in particular, delivered a standout performance following a successful 2020 En Primeur campaign. Bordeaux continued to lose trade share to other regions, while California and – in particular – Champagne attracted a new wave of investment interest.

The start of the year was all about bubbles. Champagne did not only dominate the list of wines on the rise, but the region took four out of the five spots of the most traded wines this quarter. Louis Roederer’s Cristal itself filled three of these.

Judging by the first quarter, 2022 is set to be an exciting year, abound with opportunities for fine wine. The ever-decreasing supply of the most sought-after wines is pushing up prices but also leading to a market expansion, as buyers seek value and (re)discover regions, new and old. The perceived stability of fine wine is providing protection in an environment of rising costs and inflation and is bringing more investors to the most delectable of markets.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by fine wine. Download our brand new quarterly report for your summary of the past quarter in fine wine.

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The Champagne Brands Driving Price Growth

Champagne in the cellar

Champagne looks set to capitalise on its excellent 2021 performance. Last year was fantastic for Champagne brands as sales figures for the category rocketed beyond pre-pandemic levels. Over 350 million bottles were exported worldwide last year and the appetite for French bubbles – synonymous with luxury, indulgence and good times – gained the most ground in the US which has now surpassed the UK (37.4%) as the largest export market by volume (39.1%). 

This price growth can be attributed to two things: restaurants, nightclubs and bars reopening worldwide, as well as ultra high net worth collectors focusing their attention on the category. With less supply available, prices surged.

The sky was the limit for Champagne in 2021 as it ended the year up 40% and at a record high level. 2022 looks incredibly promising for the category too as it’s up 9.6% so far this year. 

Louis Roederer Cristal Rosé

Prestige Champagne brands were the key price drivers in 2021 and the headline acts with the top performance were highly sought-after names including Louis Roederer Cristal (with high demand across the 2008, 2012, 2013 and 2014 vintages). Interestingly, the most traded wine by value was the 99 point scoring Louis Roederer Cristal Rosé 2012 as the market for rosé Champagne expands. Other Grande Marques with top billing were the ultra-premium Salon (2007, 2006 and 2002 vintages), as well as Taittinger’s Comtes de Champagne 2006 and Dom Pérignon’s Rosé 2005.

Non-Vintage Champagne

However, it wasn’t just vintage Champagne that sparkled. The trade of non-vintage (NV) Champagne also broke new ground and made up the most-traded part of the category. The market has also broadened with NV Champagne’s trade share up from 5.1% in 2018 to 17.6% in 2021.

With such impressive performance in 2021 as well as in Q1 this year, there’s no doubt that Champagne has now cemented its place in the secondary market for fine wine. What’s more, there is no other region where the top wines are still this affordable. Savvy investors who hold top Champagne know just how approachable this category is, when compared to the most prestigious Burgundies, top Napa wines and the very best of Bordeaux.

Want to find out more about investing in Champagne? Read WineCap’s in-depth analysis in our Champagne Report.

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Spring Frosts in Bordeaux

Aerial shot showing burners in Bordeaux vineyards

Bordeaux wine producers braced themselves this week as temperatures dropped as low as -7℃ in certain areas. It’s the second year in a row that the region has experienced Spring frosts and the coldest temperatures for this season since 1947. As châteaux try to ward off the frost that can wreak havoc on their entire crop, we’ve taken a closer look at how it impacts vines and what producers can do to try and combat it.

Frost and Wine: How Does it Affect Vines?

Spring frosts happen when cold air below 0℃ collects at ground level and freezes any water that has settled on surfaces. If this happens to new buds that have burst it kills them. The impact of this is huge and can impact the vintage yield significantly.

Vineyard Frost Protection

There are several ways that wine producers can try to combat frost in the vineyard. One popular and traditional method in French winemaking regions is the use of ‘bougies’, literally ‘candles’ in French, but more often ‘burners’, using old oil drums. They are placed throughout the vineyard to generate heat which helps the air to circulate and prevents the cold air from settling and causing the frost.

Wind machines are more common in areas that are prone to frosts. They act as large fans with a heating element inside and aim to keep the temperature at ground level above freezing. You might have even seen photos of some producers using helicopters above the vineyards in order to circulate the air!

Sprinklers are also used to spray water onto the vines. As the water freezes around the green tissue, it releases some heat which gives vines just enough protection to fight off the frost. 

One Bordeaux producer who has fought frost with 100% success using another method this year is Liber Pater in the Graves region on the Left Bank. Owner ​​Loic Pascquet no longer bottles his wines adhering to the AOC system which has strict production requirements. Instead, he chooses to bottle his wines as ‘Vin de France’ and is free to use frost nets in the vineyard, something that AOC classified producers are not permitted to do. Frost nets cost half the price of burners and are also reusable.

The Impact on the 2022 Vintage

While we don’t know just yet the full impact the Spring frosts may have had in Bordeaux, it’s likely that yields will be down. With less fruit available to make the wines, the amount of the 2022 vintage released on the market could be drastically reduced, meaning that the global demand for Bordeaux would struggle to be satisfied.

 

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Burgundy Regional Report

Burgundy Region

Our Burgundy Report delves into the fundamentals of this fascinating region, including its investment market and key players.

There is a long-held maxim in the wine trade: no matter where a wine lover starts, they end up in Burgundy. The same increasingly applies to investors.

Burgundy’s appeal lies in its contradictions. It is the most romantic fine wine region, yet also the most expensive. Quality is consistently high, but production volumes are exceptionally low. Intuition plays a central role, yet it is one of the most researched wine regions in the world.

With just two primary grape varieties and three quality classifications, Burgundy can appear deceptively simple. In reality, its patchwork of AOCs, fragmented vineyard ownership, and thousands of individual bottlings make it one of the most complex fine wine regions to navigate – for drinkers and investors alike.

WineCap’s Burgundy Regional Report explores how this complexity has translated into extraordinary long-term performance, how the investment market has expanded in recent years, and where opportunities are emerging today.

Key findings from the Burgundy Regional Report

Burgundy is the best-performing fine wine region

Over the past two decades, Burgundy has delivered the strongest price performance of any major fine wine region. Burgundy prices have risen by over 500%, with a significant proportion of that growth occurring since 2016, driven by rising global demand and extreme supply constraints. This performance has cemented Burgundy’s reputation as a high-return – albeit high-entry – investment region.

Rarity is the primary driver of Burgundy prices

Unlike Bordeaux, where scale and brand power underpin liquidity, Burgundy’s market dynamics are driven by scarcity. Fragmented vineyard ownership and tiny production volumes mean there is very little of any single wine available globally. This structural rarity has amplified price growth, particularly for top producers, and continues to underpin long-term demand even during broader market corrections.

Burgundy’s investment market has expanded significantly

As prices for the most famous names have climbed, the Burgundy investment market has broadened. Buyers have increasingly looked beyond the very top labels, exploring a wider range of producers, appellations, and classifications in search of relative value. This expansion has increased market participation and liquidity, making Burgundy more accessible than ever, despite its reputation as the most exclusive fine wine region.

Price corrections have created entry opportunities

Following a prolonged period of rapid appreciation, Burgundy prices have fallen by over 30% from their most recent peak. Historically rare, this correction has improved availability and created opportunities for investors to access high-quality wines at more attractive levels, without undermining Burgundy’s long-term upward trajectory.

Burgundy fragmentation creates both complexity and opportunity

Burgundy’s highly fragmented structure – with dozens of producers often sharing a single vineyard – is a defining feature of the region. While this complexity presents challenges, it also creates opportunity. Differences in producer reputation, vineyard location, and relative pricing mean that careful selection can materially impact investment outcomes. Understanding this fragmentation is essential when identifying wines with the strongest risk-reward profile.

How WineCap selects Burgundy for investment

The report outlines WineCap’s disciplined approach to Burgundy selection, focusing on liquidity, historic performance, value within individual producers’ ranges, and relative pricing within vineyards. In a region where availability is limited and pricing dispersion is wide, informed selection is critical to long-term success.

Explore the full report

WineCap’s Burgundy Regional Report provides an in-depth analysis of Burgundy’s price performance, market expansion, historic foundations, structural complexity, and key producers – alongside a clear framework for identifying investment-grade opportunities.

Download the full Burgundy Regional Report to explore the data, insights, and strategies shaping one of the world’s most sought-after fine wine regions.

 

 

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The Fine Wine Market is Seeing More & More Investors

Fine wine bottles in a rack

 

There is no question that appreciation of wine is increasing all over the world which, subsequently, has piqued the interest of potential fine wine investors across the globe.

The fine wine market has established itself as a low-risk marketplace for anyone looking to get into the investment world or wanting to expand their existing portfolio. But why is it so popular?

In this article, discover why more and more people are investing in fine wine and, if you’re considering becoming a fine wine investor yourself, find out how to get started.

Differences between fine wine and other investment methods

 

An alternative investment

An alternative investment is any way of growing your capital that doesn’t fit into the traditional categories, such as equity and bonds.

Alternative investments, such as fine wines, allow investors to diversify their investment portfolios. Doing so decreases the risk over their entire portfolio, giving them the chance to strengthen what they already have.

Low correlation with the stock market

The fine wine market doesn’t correlate with the stock markets because its value relies on the good old-fashioned supply and demand model.

Investment-grade wine producers only make a small amount of wine every year, this already increases its value. As soon as someone drinks that bottle of wine, there is one less bottle to buy, but the demand for that wine doesn’t go away.

This continuous cycle is what often gives fine wine investors such a healthy return on investment, unlike traditional investment methods where prices often rise and fall unexpectedly.

It’s a tangible asset

A tangible asset means it is a physical object. A fine wine investor invests in a real-life, physical product, which means they have direct ownership of that wine and can crack open and enjoy it should they wish to.

This differs to stocks and shares, where although you may receive paper confirmation, you don’t truly own the product – making it less secure than tangible assets.

Low volatility

Volatility is a term to describe the rate prices of an item increase and decrease in a market over a period of time.

Traditional investment methods, like stocks and bonds, have very high volatility. Prices can increase and decrease for any reason at any given time. Indeed, sometimes it only takes one prominent and influential figure to publicly criticise it for its price to dramatically drop.

The fine wine market has low volatility with stable price growth over time, which is why fine wine is considered a low-risk investment.

So, how can you turn fine wine into profit?

One of the many great things about fine wine investment is that you can take it up whether you are an investment expert, or a hobbyist looking to expand your portfolio.

If you are new to fine wine investment and would like some help deciding where to invest your money, you could look into working with a fine wine investment company like WineCap.

Here at WineCap, we offer expert, unbiased advice on strategic investment opportunities and can walk you through how to get the most out of your investment.

We also store your fine wine in government bonded warehouses, ensuring your wines are stored in optimum conditions.

Learn more about wine investment and schedule a free consultation today.