NEW YORK, Nov. 19, 2012 /PRNewswire/ -- Charlie Martin is Managing Director of a specialized wine portfolio firm based in England, First Growth Bordeaux, which offers bespoke services to clients wishing to buy prestige wine as part of their mix of alternative assets. New York based TouchInvest, a tangible investing community, spoke with Charlie about wine, investing and travel to Bordeaux.
How would you characterize a typical wine investor?
The proportion of acquisitions made solely for future capital growth is increasing; it runs at about 75% of our client base. These buyers will be seasoned investors in other more traditional markets because a wine portfolio tends to occupy anything up to 5% of a mix of assets although reports show this figure is growing annually as people react to the current climate and low savings rates by going for more creative investments. Generally a wine investor has their property and equity portfolios buttoned down before they give us a call. The remaining 25% of FGB's clients simply like the idea of holding wine assets as collections; price performance is still part of their aim but the feeling of owning the world's very best wines is a big factor; it has great conversation value and a perk or two along the way.
Here's the scenario: You have a total of $100,000 to invest in the asset over 3-5 years. Which wine would you look to acquire for your portfolio?
A good advisor will develop a mix of wine labels that all have the potential to offer aggressive growth but most importantly deliver a solid platform for mid-term gain that is reflective of the asset. The real short-term opportunities are seen in some price disparity between suppliers, where negotiation on asset purchases can deliver excellent acquisition value for the client. A good advisor also knows which labels are gaining a growing client base in new markets and these can't be ignored for an aggressive spread. Then there is the ability to engage with your investment, one chateau I like for this element is Pontet Canet based in Pauillac which uses horse and cart for production and transportation. They believe their methods are making vines healthier. In terms of a conservative investment, Latour is attractive as a mid term hold, -- only 40% of what they produce goes into their wines leading to great quality control. Additionally, there are no new Latour vintages coming on the market for 8 years.
A relatively new wine investor would like to take a 4-5 day trip to the Bordeaux, Burgundy region next year, what are your top 3 suggestions?
Travel from the beginning of April onwards for that lovely climate and ideally go to Bordeaux and sample wines at the First Growth Chateaux on the Left Bank of the river. They're not only the most impressive wines but incredible estates to visit. As well as the top five Chateaux include a visit to Chateau Palmer (in Margaux) and both Cos D'Estournel and Montrose (in St Estephe) which I believe produce wines that compete with the First Growths. A great place to stay is Chateau Marojallia.
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SOURCE Touch Invest