Wine experts in war of words over fine wine as worthwhile investment

By Gemma McKenna

Published: 20 October, 2014

Wine experts are at loggerheads over whether it's worth investing in fine wine or not.

Stephen Forward, owner of independent merchant Essentially Wine, drew the ire of wine investors with a blog last week by suggesting that fine wine as an asset class is merely "fool's gold". In response, Will Beck, a partner at Wine Asset Managers, a specialist fund management company investing purely in fine wine, said Forward's point's were "inconsistent and ill-conceived".

fine wine Fine wine investment causes controversy yet againIndustry insiders disagree over whether it's worth investing in fine wine in the long term.

Forward argued that "there is no intrinsic value in wine and so no one is able to reliably predict the value of any wine in the future. Wine has only speculative value, and speculative value is impossible to reliably predict."

Forward criticised the spread of fine wines from Bordeaux to elsewhere, calling it a "feeble and desperate attempt to inflate the punctured wine investment balloon". He also hit out at the practice of using historical data on wine prices to predict how values will fare in future.

But Beck, replying to Forward's comments in a blog post today, said it was "eccentric" to think that investment managers in any asset class would not use past data to make forecasts. "It's what they do to make an investment case", he said.

Beck says the Bordeaux-based fine wine investment market "enjoyed a bull run of a staggering scale from 2005 to 2011" thanks to the Far East but admits its subsequent performance has been "unprecedented in size and longevity and is only now stabilising following four years of decline".

He adds that secondary market prices are now higher than they were before, adding that considered on a 10-year cycle, "the secondary market price increases of older vintages have been considerable". "It is an inescapable fact, and 10 years from now I am confident they will be much higher still."

"The idea that the fine wine market should be avoided as it is inherently unpredictable is fantastic. It requires bravery to put something as asinine as that into words and publish them," Beck says.

However the pair do find something to agree on: both disapprove of the faux wine investment companies, or "boiler room operations", as labelled by Beck, that defraud the public and give the industry a bad name.

Forward has added further fuel to the fire in a second blog on the subject, published today as Why fine wine prices won't recover anytime soon.

Share your views on the matter by responding to our poll on the right, tweeting us @harperswine using #finewine, commenting below or emailing Gemma McKenna.

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