The turmoil in fine wine markets since September 2008 created a need for better tools to track wine price trends than the limited options which exist today. Therefore, Vinfolio decided to develop a series of nine wine price indexes utilizing auction data from our WinePrices.com site (read today's press release).
Auction data is an ideal resource as a basis for price indexes for several reasons:
- Fine wine auctions are recognized as the industry standard for fine wine pricing trends as historical press coverage from wine publications demonstrates.
- Auction prices (inclusive of buyer's premium) represent completed transactions, not merely asking prices.
- Pricing data is derived from global auction activity - i.e., not solely from the UK, US, or any other single geography. As I have written before, fine wine prices are driven by global supply and demand.
March 2009 index results indicate fine wine prices are rebounding
If one reviews the summary results page for the WinePrices.com indexes, you'll note that seven of the nine indexes have positive YTD results with the median YTD performance being a 4.1% gain whereas the median year-on-year performance is a 25.9% decline. In particular, the three indexes with the most auction activity -- the Fine Wine 100, Fine Wine 250, and the Bordeaux First Growth 100 - were up from 2.1% to 5.0% in March and from 4.1% to 7.8% YTD.
Consumer confidence climbing
As further evidence which correlates with the positive price trends, The Conference Board's Confidence Index increased almost 50% in April to 39.2 (1985=100), up from 26.9 in March (see April 28th press release The Conference Board Consumer Confidence Index Increases in April for more details).
Wine investment opportunity?
With wine prices having declined 25% in the past year and now showing consecutive monthly increases in the most frequently traded investment-grade wines, maybe it's time for collectors to resume buying and/or investing.
In addition to our wine investment service, Vinfolio happens to be offering a new pristine 31 OWC (original wood case) parcel from a single private collector with 10 cases of 100-point Parker-rated wine available for $185,000. Call Vinfolio if you are interested in learning more (415-946-1300.
