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Wine is top of the asset class for October, but for how long? Wednesday, 23rd November 2011
Wine outperformed equities, gold and oil, to become the top performing asset class in October.
According to a report from The Bordeaux Index, wine is the asset class that lost the least value last month, with the FTSE dropping 8 per cent and the Dow Jones Index losing 9.5 per cent. While gold fell 5.6 per cent, wine lost just 4.3 per cent, although the report went on to suggest the fine wine market is experiencing a bubble that could soon burst.
"The fine wine market enjoyed almost two years of unchecked growth from the summer of 2009 to that of 2011, rising by around 60pc. It would not be difficult to argue that some kind of correction was due," said Will Beck of the Fine Wine Fund.
"The fine wine market traditionally gets spooked by macroeconomic events that lead to financial market turmoil – the oil crisis in the Seventies, the stockmarket crash in the late Eighties, the Asian currency crisis late Nineties, and now the recent recession and sovereign debt crisis. Stock risk and market risk is relatively low, but when you get financial market systemic risk, then even fine wine is affected."