Wine simple: Investing in wine
John Barker
 John Barker is an Auckland lawyer, writer and scholar who is currently researching a doctoral thesis entitled "Regulating Wine: the geographies of law in a globalising wine industry". In this regular column he'll be going through some of the basics of wine - tasting, cellaring, wine terms - all those things that can be a little mysterious to the uninitiated.
Money where your mouth is
For many wine lovers, the idea of investing in their favourite commodity holds a special attraction. There is a wonderful temptation in the idea that if your investment fails to reward you financially, then at least you can seek solace in its consumption.
Over the past few decades, wine has become a significant an investment commodity and there are now a range of different avenues for investment in fine wine both here and overseas. The internet has given the secondary trade in fine wines a further boost with a number of (not always successful) on-line wine trading and auction companies, and even some fledgling stock exchange style companies, making this trade internationally accessible.
Yet wine is far from being a simple or risk free investment proposition. There are only a limited number of wines that will turn a decent profit on the investment scene. On the sinister side, a number of tales of fraudulent wine investment schemes and counterfeit bottles have surfaced in the overseas wine media in recent years. However, these instances are few and far between and you will find that any established local wine merchant values her or his reputation far more than the chance of making a quick buck.
If you are considering wine as an investment, here are a few pointers.
First of all, you need to make sure you are investing in the right sort wines at the right price. A bit of background research may be necessary here.
Talk to a reputable wine merchant. Read international critics like Robert Parker whose opinions guide investment markets. Study auction results (published in many wine magazines) from the leading auction houses - Webb’s and Fitzgerald’s in New Zealand, Langtons and Oddbins in Australia, and Christies, Sotheby’s, winebid.com, and uvine.com on the international market.
It is safer to purchase wines with a proven track record for ageing well and selling on the investment circuit. Top red Bordeaux and Burgundies and Vintage Port have traditionally been the most popular wines on the secondary market. These vinous aristocrats are now joined on the international investment circuit by an ever increasing number of “modern classics” from many other parts of the world.
If investing in local wines, stick with wineries with a proven track record like Te Mata, Stonyridge or Dry River (to name but a few) or wines that have a string of gold medal or trophies.
Be cautious with wines that are touted as the “next big thing”. Premium pricing and deliberately manipulated scarcity do not necessarily add up to good wine or a good investment. Avoid buying wines from “off” vintages. No matter how good the wine in the bottle actually is, potential purchasers are nervous of such wines.
Buy your wines from a reputable source, so that you can be assured that they have been well stored and have a legitimate provenance. Similarly, once you receive the wine yourself, you must make sure the wine is stored properly.
Appearance is an important factor on the investment market. Torn or rotten labels can significantly reduce a wine’s resale value. If a wine is packed in a wooden case, avoid the temptation to open it as sealed cases are often more highly valued.
Take into account that New Zealand is not large or wealthy enough to have a truly vibrant secondary wine market. You may well end up selling your wine overseas, which will add cost to the selling process.
Finally, remember that there are no guarantees when inves 
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