Is Wine the New Gold? Wealthy Investors Seeking Stability Think So

Many investors understand the idea behind a well-diversified portfolio: When one investment falls in price, others can help offset those losses. You can accomplish that through a mix of assets, including alternatives like real estate, private markets and crypto. But high-net-worth individuals are increasingly diversifying with a collectible that has been around for over 8,000 years: wine.

Yes, you read that right.

According to a recent report by WineCap, a U.K.-based fine wine investing platform founded in 2013, the same unrest in the Middle East that has driven a flight to safety in the equity markets has caused investors to turn to rare wines as a hedge against rising costs and market volatility.

"As an asset class, [wine] is certainly garnering more attention," says Vincent Birardi, senior wealth advisor at Halbert Hargrove. "Not only for traditional equities, but a form of hedge against general inflation."

Diversifying with fine wines can be achieved in one of two ways. You can purchase shares of curated wine collections by using investment platforms, or you can add investment-grade wines to your home cellar using auction houses and speciality retailers.

A full-bodied hedge for your portfolio

WineCap's report found that the percentage of respondents who view fine wine as a source of portfolio stability has increased from 54% to 70% in the past four years, overtaking sustainability and outpacing strong returns as the largest motivator for investors.

That shift is being driven by wine's tangible nature and fixed supply — two factors that influence scarcity and demand. But there are other catalysts for the alternative asset and dinnertime libation, too.

"Its market... typically moves at a much gentler pace than equities or broader financial markets," WineCap's CEO Alexander Westgarth writes in an email to Money. "Rather than replacing traditional safe havens like gold, fine wine should be viewed as a supplementary hedge."

Westgarth says that because the wine market is driven by long-term global demand from collectors, investors and enthusiasts, fine wine is a less reactive hedge than gold when macroeconomic fears and geopolitical instability arise.

This year, the Iran war has fueled another bout of price hikes, which in turn is encouraging investors to seek out portfolio safeguards.

Since hitting a five-year high in October 2022, the U.S. dollar has lost more than 12% of its value. More recently, inflation as measured by the consumer price index stands at 3.8% year over year. For comparison, the Liv-ex Fine Wine 100 index — the industry's leading benchmark for monitoring fine wine prices — has gained 1.8% year over year.

But that pales in comparison to the long-term gains wine has historically produced.

"Over the last 10 years, on average, fine wine was has produced an annual return close to 10%," Birardi says. "Gold has averaged roughly 4% to 5% annualized over the same period."

What investors should (and shouldn't) expect from fine wine investing

Just because the rare wine market is relatively insulated from external headwinds doesn't mean it comes without price volatility.

WineCap's wine tracker shows that over the past year, Hubert Lamy's Derrière Chez Edouard has gained more than 54%. Over the same period, Domaine Roulot's Auxey-Duresses Premier Cru lost more than 78%.

Fees can also eat into returns. According to Birardi, research indicates that the cost of holding investment-grade wine typically runs 1% to 2% per year when accounting for insurance and storage.

And, just like with other assets, patience is required for success.

"We typically advise clients to approach fine wine with a five-to-10-year investment horizon," he says. "Much of the asset's value creation comes from increasing scarcity over time as bottles are consumed and availability declines."

Patrick Meyer, director of brand marketing at Spectrum Wine, agrees. "The people who do the best with wine investments... are the people who treat it almost as a bond," he says. "Diversity is important, but [investing in fine wine] rewards patience."

Westgarth warns that when investors want to sell their holdings, achieving a desired price often takes longer than anticipated since wine is less liquid than traditional financial markets. According to Meyer, the typical sales process can take 30 to 45 days through an auction house.

"It isn't unlike fine art or even commercial real estate," Meyer says.

Fine wines also go through bull and bear cycles just like other asset classes. From 2022 to 2025, the wine market saw a nearly 30% drawdown.

"But over the past six months, we're already seeing some major, positive growth again," Meyer says. "After the big correction, it's very encouraging that we've had sustainable growth over the past six months."

How to invest in wine as a portfolio hedge

WineCap builds and manages portfolios of investment-grade wines, making it a popular option for investors looking to diversify with the collectible. The company uses a state-of-the-art underground storage facility built within former military tunnels and charges a competitive 5% commission when investors want to sell.

But the company is hardly alone. There are several options for managed wine collecting. Platforms like Vint, for example, purchase expertly curated collections and sell them as SEC-qualified fractional shares.

"The platforms take on all the heavy lifting," Meyer says. "They're the ones securing [the wine], verifying provenance and ensuring chain of custody and storage conditions."

He also notes that the barrier to entry is very low, with some platforms allowing investors to get started with as little as hundreds of dollars.

For wine enthusiasts who are interested in at-home collections, taking precautions to ensure their wines remain investment-grade is recommended.

"If you're someone with a home cellar, there's a lot of overhead investment in addition to buying the wines," Meyer says. "You have to store it properly, maintain it and you might want to insure it."

There is, of course, an additional perk to the DIY approach.

"It's a super exciting time because fine wine has never been more accessible," Meyer says. "But if you have a home cellar, you get to walk over, grab a bottle off the shelf and enjoy it with dinner if you choose to."