Key takeaways
- Vinovest founder Anthony Zhang says the modern portfolio is continuing to shift and going to favor more and more untraditional passion assets like wine.
- Zhang says an investor can pay anywhere from $100 to over $54,000 per bottle.
- France’s Champagne and Burgundy regions remain popular for blue-chip wine investments.
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The folks at Vinovest say, “fine wine is the best-kept secret in investing” but they intend to let more people in on it. Anthony Zhang, CEO, and Co-Founder of Vinovest created a platform that allows users to invest and own blue-chip wines. “You don’t need to invest in the ultra-expensive wines to enjoy the historical returns that we’re really seeing in wine,” he told Yieldstreet’s Peter Kerr on a recent episode of The Yield.
Zhang has a background in start-ups, angel investing, and cryptocurrency said he considered wine investments a win-win asset class but quickly realized that it was actually quite difficult to break into the wine industry as a 20-something investor. His goal has been to democratize access to investing in blue-chip wines and make it simple and transparent for everybody.
“I would love to see every single bottle of wine consumed and enjoyed. That’s what the winemaker intended to do, somebody enjoying it with friends and family and having a great time, however, sometimes it doesn’t happen, right? You see a lot of times the sort of what we call unicorn bottles of wines from 1945 or from you know, really, even from before the 20th century, they’re being auctioned off for hundreds of thousands of dollars,” Zhang pointed out.
Vinovest offers users two main experiences for their users, ranging from a fully-managed portfolio product to a more hands-on wine marketplace experience.
Considered is considered a passion investment more than the standard alternative. Storing, tracking ownership of wine, and limited availability, along with other logistics, present unique opportunities for investors according to Zhang.
He described what to consider when investing in wine as well as the process of buying an individual bottle of wine at an auction. Some wines obtain an art-like value with rare bottles of wine, such as those from the WWII era considered a rare investment opportunity. “It’s so rare that people just want to lock it up like it’s art. So there is a certain point where the wine kind of reaches the end of its life of actually tasting like wine and starts becoming more of a sentimental collector’s item,” he said.
It all starts with the region where the wine originated according to Zhang who said, from Napa Valley to France, Italy, and Spain, the point of origin matters. He also pointed out the production date plays a major role in the value of a bottle of wine. Peak variations alternate in the decades following production, and wine investors know which peaks offer the most return on investment.
An investment in a bottle of wine can cost anywhere from a mere $100 to over $54,000 per bottle, there is a price point for every investor. And for investors who are just getting started, Zhang said there is no need to invest in ultra-expensive wines in order to enjoy the historical returns that we’re currently seeing in wine.
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2 Represents an average net realized internal rate of return (IRR) with respect to all matured investments in your portfolio, utilizing the effective dates and amounts to and from the investments and net of management fees and all other expenses charged to the investments. Past performance is not a reliable indicator of future results and should not be relied upon as the basis for making an investment decision. All securities involve risk and may result in significant losses, including the loss of principal invested.[read more]