Bordeaux: Heart of the Wine Investment Market
Wine investment has grown more diverse over the years, and for many investors, more personal. Still, with factors such as these evolving, one thing remains constant: Bordeaux, representing nearly 90% of the wine investment market, continues to be the top choice for investors on a global scale –or, as the French would say, the wine world’s pièce de résistance. The truth is, Bordeaux has earned this nearly unchallenged reputation honestly. The simple question may be, How? The answer, however, is a bit more involved.
Bordeaux has enjoyed a two-thousand-year long winemaking history, lending it a cachet and prestige that cannot be shared with other regions. Added to this impeccable history are its gifts from nature herself, most evident in its enviable environment. Bordeaux’s terrain and climate create the ideal surroundings for cultivating the finest in grape varietals – possibly the finest in the world. These superior grapes, in the hands of Bordeaux’s experienced and knowledgeable winemakers, produce vintages nothing short of dazzling. They are structured and diverse, but always with a heady, romantic aroma and unparalleled flavor. While it’s true that other wine regions hold comparable aspects in certain areas, none – even those of significant renown – can touch Bordeaux’s history, position or astonishing reputation for excellence. Bordeaux’s resplendent status is underlined and supported by the exquisite characteristics of its wines, which continue to delight critics and ordinary buyers alike. This climate of unquenchable consumer demand has placed Bordeaux at the very heart of wine investment.
Another important factor in Bordeaux’s powerful and consistent investment history is the region’s heightened quality assurance and stringent limitations on production. Vineyard sizes are, by law, restricted, and only a designated percentage of any vineyard’s product is picked for its primary label. This same percentage is inconstant, fluctuating by things such as each year’s weather and subsequent harvest. In particularly less-than-ideal years, a château may even decide to halt the release of a vintage altogether. While ensuring its unrivaled standards of excellence, this drastic step only adds to the aura of Bordeaux’s magic and desirability. And, from an investor’s standpoint, it is another means by which the value of their Bordeaux assets increases exponentially.
Combining sheer elegance with consistently sound returns, and reflecting the fundamental economic tenet of supply versus demand, Bordeaux wines remain the smartest and most profitable wine investment in any diversified portfolio.
The Vital Role of Bordeaux in your Wine Investment Portfolio
Due to their history of superior performance, Westgarth recommends that the core of your portfolio be made up of eight outstanding Bordeaux wines. The so-called ‘Big Eight’ are the five Bordeaux First Growth wines—Lafite Rothschild, Latour, Margaux, Mouton Rothschild and Haut Brion—plus celebrated Right Bank wines Petrus, Ausone and Cheval Blanc.
Though there are many top quality vineyards—some renowned, others almost unknown—we believe there is little substitute for the consistency, reputation and tradition that the top Bordeaux chateaux maintain. For example, a twelve-bottle case of 1982 Lafite Rothschild was originally available for $275 and now, 30 years later, trades at above $50,000—an annual return of 20%.
With a reputation based on centuries-old tradition, vigorous attention to detail and the ideal environment, it is no wonder that demand for the Bordeaux Big Eight has been so consistent and overwhelming over the years. With these wines forming the core of your investment, you too will have everything to gain from the reliability and brilliance of Bordeaux.
En-Primeur or Wine Futures as it is know in America is the earliest stage the top Bordeaux wines can be purchased. At this stage the wines are still in barrel undergoing the aging process where they can be secured up to 2 years before they will be physically available.
The En primeurs are released at the end of spring the year after the grapes were grown. Wine can be considerably cheaper at this early stage however being certain of a wines quality is hard so early on in its life. The wine critics score the wines twice whilst in the barrel and then once again from the bottle. These tasting take place at the end of April and the score changes can seriously effect the value of the wines.
Although the prices of En-primeur can go down after it has been and traded on the secondary market. Its is the first tranche that is traditionally the best price to purchase but relies on good relationship with the negociants to be able to be offered an allocation.
For En-primeur to truly be a good investment its prices needs to be compared other vintages from the chateux where the more stable scores of bottled stock can make it more appealing as an investment.