Capital Growth wines

Bordeaux | Provenance | Performance

Why Fine Wines?

ImageInvestors now are actively searching for alternative investments that are not correlated to many of the risks associated with investing in today’s turbulent or underperforming equity markets. Indices tracking the performance of fine wine have held up well in this climate of uncertainty surrounding the global financial markets and low interest rates.

An investment in fine wine can offer superior returns, relatively low volatility that is separate from stock market volatility, and significant diversification benefits reducing overall portfolio risk. The low or negative correlation between fine wine and financial assets make fine wine an effective hedge investment. Great wines in great years constitute superior returns and almost any other combination yields at best below average returns.

In the UK, wine is a tax-exempt asset with a life-expectancy of less than 50 years, and investors are exempt from Capital Gains Tax to the private individual.

The wine market is both stronger and more international than it was even a decade ago, thanks to the influx of new, super-rich players from the emerging markets such as Brazil, Russia, India and China. Consequently, demand is still on the increase for the very top wines, while available supply is actually contracting. That situation can only exert more upward pressure on prices.

Along with increased trade, various tax reforms in the emerging markets are set to increase demand. Hong Kong, for instance, has recently abolished import tax on fine wine from 80% to 0% making fine wine much more attractive. These new markets are developing wine tasting and appreciation classes to educate consumers.

Capital Growth Wines

International Tax Consultancy (ITC) Limited
trading as Capital Growth Wines
Registered in England and Wales | Registration Number 07812075