Tuesday, January 17, 2012

Wines not only please the palate, they please the wallet even better


So you want to invest your idle cash in something that could make you rich down the road? Here's one to think about. The Daily Mail and Reuters call it the "best performing investment of the decade." Is it a currency, a stock a futures commodity, or a bond?
None of the above. It's fine Bordeaux wines.
Just when stock markets have been in the doldrums over the last few years, crashing here and there from the global recession and the many financial shocks and aftershocks that attended 2011, like the European sovereign debt crises that continue to dampen the stocks well into 2012, here comes a light, not at the proverbial end of the tunnel, but a lot closer. And it could be so close, it's just a few stair steps down to your wine cellar.
Everybody loves a good wine and the finest and most expensive are aged wines from several hallowed vineyards from Europe, notably the Bordeaux regions of France. You may even find them in California's Napa valley. Now what determines an investment grade wine? There's one guy who is so respected among the world's finest sommeliers and oenophiles that his word alone can make a wine worth investing. He is none other than (drum roll), Robert Parker, Jr, the world's most influential and powerful wine critic. He rates wines and scores them in a scale of 100. Any wine that gets a "Parker Score" of at least 90 becomes investment grade.
Astute investors go for a portfolio with a mix of risky investments and safe havens. Gold being one of the latter. For sure there are many blue chip investments around, but they suffered the flat if not uninspiring appreciation over the last decade that have caused investors to lose weight. But not so when you invest in fine wines.
It's literally recession proof. Bordeaux wines have been observed to keep on appreciating in value more than just about all mainstream investments over the last decade. While the stocks in the FTSE 100 has appreciated just 3.4% on average, the top 100 wines have appreciated by as much as 40% on average as what most stocks in the Liv-Ex 100, the world's first stock market for wines, will tell you. Between 2000 and 2010, some of the most famous vintage wines from Bordeaux have even quadrupled in market values.
So take your idle money or junk your losing stocks and invest in fine wines, especially Bordeaux vintage. With no VAT taxes, no capital gains tax, unregulated by the FSA and a growth curve that is recession proof, is there anything else to ask in what could be the perfect investment? Indulge the wallet with a possession that knows nowhere else to go but up in value. But don't be so greedy. Leave some for the palate. And in case the wine values falls off the cliff, however unlikely, at least you can drink it.

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