Does cost of carry just involve inflation, or also lost opportunity cost if you’d invested this sensibly in an inflation-busting way, compounded? Wine is a terrible investment at the moment.
The cost of carry consists of storage and insurance costs, plus the return on a risk-free bond (which, in theory, accounts for inflation).
If one views wine purely as an investment, I think it is generally a poor investment. In my opinion, no one really needs exposure to "wine as an asset class" (as a lot of people in wine investment will have you believe), especially if they do not love wine.
However, for those who enjoy wine and treat it as a passion asset with both a financial and an emotional return, I can see a case for some back vintages being attractively priced today. Current release prices, on the other hand, are, I am afraid, still too high in my view.
Does cost of carry just involve inflation, or also lost opportunity cost if you’d invested this sensibly in an inflation-busting way, compounded? Wine is a terrible investment at the moment.
The cost of carry consists of storage and insurance costs, plus the return on a risk-free bond (which, in theory, accounts for inflation).
If one views wine purely as an investment, I think it is generally a poor investment. In my opinion, no one really needs exposure to "wine as an asset class" (as a lot of people in wine investment will have you believe), especially if they do not love wine.
However, for those who enjoy wine and treat it as a passion asset with both a financial and an emotional return, I can see a case for some back vintages being attractively priced today. Current release prices, on the other hand, are, I am afraid, still too high in my view.