10½ things about collecting fine wine that I wish I’d known earlier
Good morning! 👋
Wall Street’s on track for a winning week as traders look to build on yesterday’s action. That’s great, but there are still loads of people who feel like “Everybody but me is making money.”
What if I told you there was another path?
One that helps the world’s richest people stay that way.
And those who aspire to be rich get that way.
But Keith, you may be thinking… that’s just for the ultra-wealthy.
Collecting fine wine can complement your traditional investments while de-risking your portfolio at the same time.
I wish I’d started years ago, frankly.
Please don’t slap the messenger, BTW. There’s not a lot of stuff in the headlines today that we haven’t already talked about in excruciating detail and… well, it IS Friday.
Still, if you absolutely, positively wanna talk stocks—I get it—which is why you may enjoy my interview with CNBC’s Kelly Evans yesterday regarding AI. Most investors are totally underestimating the potential, present company excluded! (Watch)
Here’s 10½ things I’ve learned about collecting fine wine that I wish I’d known earlier.
Fine wine can be tremendously affordable and accessible. It’s not just for the hi-pinky club. I got started for just a few thousand dollars.
The world’s wealthiest people have invested in fine wine for centuries for a reason. Those who want to be “like” the rich drink it. Even Warren Buffett has reportedly endorsed fine wine, saying it offers a safe yet profitable haven with very low correlation to the stock market, according to Forbes magazine in 2020.
Fine wine has outperformed the S&P 500 since 1952 by 4-to-1, according to Forbes. Think about that for a second. Every $100 invested in the S&P 500 in 1952 would have been worth $100,000 in 2020, according to the magazine... which also reported that the same $100 would have been worth $420,000 if invested in fine wine. (Read)
Dang-near recession proof. Wine, like any other collectible, can gain and lose value. Over time, the trend is decidedly higher—which, of course, catches my attention just as I hope it catches yours.
Supplies are limited. Once somebody drinks a bottle of desirable wine, the remaining supply can get more valuable because they’re not making any more. Some bottles can do incredibly well. For instance, wines from Domaine de la Romanée-Conti, arguably the world’s most prestigious winery, have regularly shown growth of 150–200% over a 5-year period. The typical stock return may be just 10% a year on average, and that’s being generous.
Expert help counts. Less than 1% of the world’s wine qualifies, so buying a nice bottle at your favourite wine shop probably won’t cut it unless you’ve got one heckuva wine shop. I chose to work with OenoFuture because they place a premium on education, and that sits well with me.
Fraud is a big deal. That’s why you’ll want to work with partners who can help you avoid getting taken to the cleaners. OenoFuture, by the way, created the world’s first dedicated internal anti-fraud team; another reason I went with ‘em over other choices like VinoVest, just to name one example. I also wanted to own my bottles directly, not buy a fractional interest or through a fund. Just like stocks, I want to buy the best, ignore the rest—something you hear me say a lot.
I do NOT want to store the fine wine I buy myself because I don’t have the expertise or facilities needed to control temperature, humidity, etc. So, I store my wine under bonded lock and key in London where it’s insured and properly cared for.
Fine-wine collectors don’t give a you-know-what about whether there’s a recession or not... which means that my small but growing collection meets demand that is already there and, likely, may well always be there.
Worst-case scenario, I can have my wine shipped to me. Then drink it.
In closing, let me leave you with a thought.
People chase stocks or hustle their asteroids off hoping to find a pot of gold at the end of the rainbow. That’s okay if that’s your bag.
I approach life differently.
I work as hard as I do because I believe doing so will allow me to enjoy the rewards that come with the effort.
If that doesn’t make sense, think about what I’m saying this way.
Many people eat a big slice of chocolate cake, then grouse about having to “go to the gym.”
I go to the gym so I can eat as much dang cake as I like—big difference!
Collecting fine wine gives me a chance to do both.
Now and as always, let’s finish the week strong!
FTC-Required Disclosure: I am an OenoFuture client and a paid business consultant to the company. My compensation is NOT based on whether you open an account or just do some tire kicking. I think buying fine wine is super fun and, dare I say it, something I expect to pay off handsomely down the line, but that’s just me. You can decide for yourself, hopefully with the benefit of learning from my experience.