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It is a well-known fact within the wine industry that there are certain famous bottles of wine from sought-after vintages that sell for thousands of dollars at auction while increasing in value every year.
As time goes on, many of these sought-after bottles are opened and enjoyed by serious wine enthusiasts of means, making the remaining bottles even more scarce and valuable.
While not every wine enthusiast has the means to afford one of these famous labels, there are a number of wine investment platforms that are working to make the world of wine collecting more accessible to people from all walks of life.
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Choosing the Right Wine Investment Platform
While the majority of wine that is produced and sold every year is purchased with the intention of consumption, there is a small percentage of fine wine that is purchased specifically for investment purposes that are meant to appreciate in value as time goes on.
Ease of Use
When it comes to any investment tool or platform, having a firm grasp on how to use the interface and navigate the system is one of the most important factors. Customers that are unsure where to find answers and make changes are unlikely to succeed at investing.
With many of the wine investment platforms on the market today being online-based, the most important part of their infrastructure is the website itself. Platforms with complicated or confusing websites are not advisable, and many customers end up leaving these services.
The majority of the top online-based wine investment platforms on the market today use high-end websites that are quick, responsive, intuitive, and simple to use. This makes it easy for customers to navigate through features, and have full control of their investments.
Many of the best wine investment platforms also employ full-time customer service representatives that are available by phone during normal business hours. Others also feature online chat features that outsource issues to a third-party representative.
Some of the most popular wine investment platforms like Vinovest also feature line graphs and charts that are similar in style to those used to track movement in the stock market. This makes it easy to keep an eye on your money and track the progress of your investment over time.
Return on Investment
Receiving a return on any given investment is the entire reason for investing in the first place. It is important to choose a wine investment platform with a solid strategy that has a proven track record of producing consistent returns for its customers.
While fluctuations in the stock market are a regular occurrence, changes to the value of any given wine portfolio are more often based on internal decisions rather than external factors. For this reason, it is very important to choose the right platform with the right strategy.
There are certain labels of wine that are well known within the industry to be “as good as gold,” as they will nearly always continue to increase in value over time given that the wine is properly preserved in a dark temperature-controlled area.
These famous collectible bottles include multi-thousand dollar bottles like the first growths of Bordeaux that can fetch prices of over $10,000 at auction depending on the vintage. It is bottled like these that sparked the idea for certain wine investment platforms.
By combining and pooling together the resources of multiple investors, wine investment platforms are able to purchase high-end bottles of wine that are nearly guaranteed to generate a return on investment if held for many years.
There are also wine investment services that place more of a focus on emerging labels with high upside rather than established bottles that are already famous and expensive. While these services can offer higher returns, they are also inherently riskier to invest in.
Business Model
There are a number of different business models that wine investment platforms employ in order to try and consistently turn a profit for their investors. While each company differs in terms of investment style, they also differ in terms of how the businesses themselves are structured.
Certain companies like Vint are only for citizens of the United States, and they have gone the extra mile of becoming fully qualified by the American Securities and Exchange Commission. This gives many customers peace of mind but makes the service unavailable for international customers.
While certain companies like Vint allow customers to start investing with deposit amounts as low as $100, there are larger minimums requirements for a number of other services. Cult Wine Investment requires a higher minimum from customers, with $10,000 being the entry-level investment.
There are other companies that are employing more high-tech methods of securing their customers’ investments, including Alti Wine Exchange which uses blockchain technology to assign each physical bottle of wine its own nonfungible token.
Vinovest is one of the leaders in the industry, and they also employ some high-tech techniques to try and bring returns to their members. They use artificial intelligence technology to track market trends and try to find the best investment opportunities for their customers.
Wine Portfolio
While there are many different ways to structure a wine investment platform, the common thread between them all is the fact that they all procure bottles of wine with the intention of holding and later re-selling them for a profit.
One of the most tried and true methods of investing in wine is to choose some of the most famous bottles of wine in the entire world that are virtually sure to turn a profit over time. This was one of the earliest forms of wine investing, making it a tough sector to break into.
The majority of the best bottles of wine in the world when it comes to fame, quality, and investment potential have already been spoken for and are in the portfolios of some of the largest and most established wine collectors in the world.
The few bottles of first-growth Bordeaux from some of the most sought-after vintages that do come up for sale at auction come with a very high price tag, as many investors are fighting for the same bottle as less stock exists every single year.
These dynamics make investing in wine much more similar to investing in art compared to other traditional investments like stocks and bonds. Like art, a well-curated wine portfolio takes both a keen eye and a deep wealth of industry knowledge and history.
Different companies employ different techniques to try and pinpoint which bottles of wine will bring the best returns for their customers over time. Certain companies rely on the knowledge and instincts of industry professionals, while others lean on high-tech methods like algorithms.
Reputation and Customer Service
Another important factor to take into consideration is the reliability and reputation of each wine investment platform. While it is impossible to guarantee results or returns for customers, the best companies provide top-tier customer service and use ethical business practices.
One of the key contributing factors to establishing a good reputation within the wine investment industry is the amount and quality of communication with their customers. The best companies have customer service technicians on call during business hours to answer all customers’ questions.
Another step that should always be taken before doing business with any investment company is to research its reputation by checking the website of the Better Business Bureau. Reputable companies will carry at least an A rating for establishing quality business practices.
Searching for online reviews is another way to get an idea of how a given company operates, though reviews are a decidedly less accurate way to check the reputation of a company. While reviews are a good indicator of quality in other industries, this is less true with investments.
Some investors have unrealistic expectations when it comes to putting their money into investment products, and others believe that they can be guaranteed results. If things don’t work out with investments, angry customers tend to leave angry reviews in an effort to damage companies.
The best way to avoid wine investment platforms with less than reputable business practices is to stick with well-established companies that carry a good rating with the Better Business Bureau. Word-of-mouth referrals are also great, especially if you trust the advice of the person giving the referral.
Top 5 Wine Investment Platforms
With so many different wine investment platforms on the market today, it can be tough to determine which is best for you.
We have highlighted five of the best options to invest in today and highlighted some of the most important features and drawbacks of each.
1. Vinovest
Pros
- Four different investment tears starting as low as $10,000 for the first
- Two to three-week turnaround to build you a custom wine portfolio
- Combines sommelier knowledge with artificial intelligence and data
- Simple interface that is both easy to navigate and understand
- Personal portfolio advisors are on hand for one on one consultations
- Partnered with renowned master sommeliers who help identify and procure wine
Cons
- A $10,000 minimum investment is too high for some wine enthusiasts
- There is a penalty for selling wines out of the portfolio within the first three years
- Minimal portfolio customization is available under the $50,000 level.
Vinovest is one of the most recognizable names in the online-based wine investment industry, and they have developed a quality reputation among customers since introducing the concept of a wine investment platform based on artificial intelligence in the year 2109.
2. Cult Wine Investment
Pros
- High-quality websites and apps allow users to easily track their investments
- Climate controlled warehouse is very secure and full insured against damages
- Included educational resources help to make users smarter investors
- One of the largest wine investing platforms in the world
- Customized portfolio advice is available at any time
- Good track record of providing high-quality and responsive customer service
Cons
- Another service with a relatively high investment minimum of $10,000
- Lower investment tiers only receive limited resources in terms of customization
- No introductory promotions for new customers
Cult Wine Investment is one of the leading platforms in the world for online wine investment. Users are able to buy and sell bottles of wine from all over the world, and Cult Wines holds and stores the bottles in a safe and climate-controlled location.
3. Vint
Pros
- One of the most approachable platforms for new wine investors
- Minimum investment amount of only $25
- Ability to buy fractional shares in a variety of different wines and collections
- Diversified portfolios including both fine wines and quality aged spirits
- Regulated by the United States Securities and Exchange Commission
- One of the only companies that do not charge an annual management fee
Cons
- Limited amount of investments to choose from at any given time
- Less flexibility and customization are available compared to other services
- No chance for users to cash out on their investments early
Vint is a unique online wine trading platform that takes a slightly different approach to the wine investment management business compared to other companies on the market. There are no access tiers or management fees, and the cost of entry is lower than any other service.
4. Alti Wine Exchange
Pros
- Employs blockchain technology to allow for completely safe and secure trading
- Uses a unique process called an initial bottle offering to procure wine
- Access to a secondary market allowing users to liquidate their portfolios at any time
- Live bidding platform that is simple for those familiar with traditional stock exchanges
- Wines are stored and secured in a high-quality wine warehouse
Cons
- Blockchain technology is not a favorite of certain “old-school” investors
- No ability to employ margin trading or short-selling tactics
- There is a two percent trading fee applied to every single transaction
Alti Wine Exchange is one of the leaders in the wine investment industry and they were founded with the intention of connecting users with tools and genuine wines while avoiding counterfeit bottles and other wine scams.
5. Vindome
Pros
- Ability to buy wines from either the live market or by browsing collections
- Two ways to sell wines as well, either make a sale offer or match a current bid
- Each wine is microchipped and stored in a secure warehouse
- The simple-to-use app makes it easy to track investments on the go
- The website includes an educational wine guide to make smarter investors out of customers
Cons
- High fees of up to four percent are applied to each transaction
- Not one of the largest or most established names in the wine investment industry
- Some wine enthusiasts are wary of blockchain technology-based platforms
Vindome is a popular wine investment company that employs a tried and true business model while making slight changes and innovations that many customers enjoy.
There are two ways to buy wines, as well as two ways to sell, and they use a unique microchip technology to track their wines.
Best Wine Investment Platforms – Final Thoughts
While there are a number of different options currently on the market when it comes to wine investment trading platforms, the best option for the widest variety of customers is Vinovest.
While the minimum investment amount of $10,000 is a bit high for some investors, Vinovest offers the best balance of quality features, an easy-to-navigate website, and a reputation for reliability.
Click here to take a look at the Vinovest website and see if it is the right service for your needs
