“The ‘90s were all about stocks. Before that it was real estate. Now the action is shifting to alternative investment—fine wine, fine art and antiques. Fine wines’ relative lack of volatility makes it hugely attractive, especially to those whose portfolios were recently abused by the stock market. Fine Wine markets are less susceptible to market downturns and adverse economic conditions.” 

So says Mahesh Kumar, Professor of finance and author of Wine Investment for Portfolio Diversification: How Collecting Fine Wines Yield Greater Returns Than Stocks and Bond, in his recent interview with SmartMoney.com. And with auction indexes regularly outpacing the Dow point-for-point, America is starting to listen. Wine Investment for Portfolio Diversification has been featured in articles in The Economist, Forbes and MoneyWeek.

Read the article on Smart Money.com  

Other Press:

Read about the book on The Economist

Read about the book on Forbes

Yes, Kumar shows empirically that fine wine has higher expected returns related to its overall contribution to risk than do stocks and bonds. But what he also does, and it’s one of the biggest reasons his book has grabbed so much attention, is give the investor practical tools to judge which wines are best bets, removing tealeaves, and celebrity oracles from the equation.  

The morale-boosting effect of it is best summed up by Ceri Jones of Interactive Investor in the closing lines of her August article Taking the Shine off Wine: “For the outsider, it is odd that an investment's value worldwide has depended so long on the subjective palate of one person. Apparently (Robert) Parker's crown is now beginning to slip, as the market becomes more confident of its own judgment. A big influence has been the publication of 'Wine Investment for Portfolio Diversification: How Collecting Fine Wines can Yield Greater Returns than Stocks and Bonds' by Mahesh Kumar, dubbed the most thorough piece of academic analysis on wine ever published. Manna from heaven for an investment industry currently obsessed with asset diversification.”

Based on robust financial analysis, and demonstrating the attractiveness and synergy of holding fine wine as part of a diversified portfolio of traditional financial assets, Wine Investment for Portfolio Diversification offers a real opportunity to learn about blue-chip wines and portfolio theory, while showing empirically that, as a diversification tool, fine wine has higher expected returns related to its overall contribution to risk than do stocks and bonds.