The case for fine wine as an investment rests on two legs: absolute performance and low correlation to financial markets. Over the decade from 2014 to 2024, both held — though the decade was far from smooth, and the nuances matter enormously for how you think about building a position.
The headline numbers
The Liv-Ex 100 — the professional benchmark for investment-grade fine wine — returned approximately 87% over the ten-year period to 31 December 2024, measured in GBP. Over the same period, the FTSE 100 total return index returned approximately 112%, the S&P 500 (in GBP-hedged terms) returned over 300%, and gold returned approximately 110%.
On the face of it, fine wine underperformed equities and matched gold. But the headline comparison obscures two things that matter: volatility and the investment timeline.
Volatility: the number most advisory firms ignore
The FTSE 100 experienced drawdowns of 32% in 2020 and 13% in 2022. The S&P 500's 2022 drawdown was 19.4%. During both periods, the Liv-Ex 100 held flat or continued to appreciate. The 2020 drawdown on Liv-Ex was approximately 3.5%, and it recovered within four months.
For an investor whose portfolio includes equities, bonds, and property, the value of fine wine is not simply its absolute return — it is the return it generates during the periods when everything else is falling. This is the diversification premium, and it has a real monetary value that headline return comparisons do not capture.
The Liv-Ex 100 drawdown in 2020 was approximately 3.5%, recovering in four months. The FTSE 100 fell 32% in the same period.
The 2023–2024 correction
Fine wine's ten-year comparison is complicated by a significant correction that began in late 2022 and continued through 2024. The Liv-Ex 100 fell approximately 20% from its mid-2022 peak, driven primarily by two factors: Bordeaux price normalisation following an exceptional run during 2020–2022, and a softening of Asian demand.
Correlation: the data since 2014
The 12-month rolling correlation between the Liv-Ex 100 and the FTSE 100 has averaged approximately 0.12 over the ten-year period. In plain terms: movements in the UK equity market explain roughly 1.4% of the variance in fine wine prices.
What this means in practice
For a typical high-net-worth investor with £500,000 in equities and £200,000 in property, adding £75,000 in fine wine reduces portfolio volatility without meaningfully impairing expected returns. The optimal allocation in academic portfolio construction studies sits between 5% and 15% of investable assets.