Liv-ex 100 woe raises hopes and fears

The Liv-ex Fine Wine 100 has fallen for the third consecutive month, raising both hopes and fears for fine wine investment.

The index fell 6.4% in September, finishing the month at 322.66. This represents a 4.05% decline on the year to date but up 4.72% year on year.

Having peaked in June, the index has been on a downward trajectory ever since and Liv-ex noted that its progress bore a resemblance to what happened in the second half of 2008.

In June 2008, the index fell for six months in total before picking back up again the following year and rising to the recent prices of today, which were at times marginally above those of three years ago.

Clearly for those investing in fine wine a downward turn is not a pleasant prospect, but the chart supplied by Liv-ex does suggest that the plunge is not as steep.

If a positive is to be drawn, as Liv-ex noted, lower prices provide buyers with a chance to pick up cases that might otherwise have been out of their reach financially.

If the present market dip follows the pattern of the 2008 fall, then in a relatively short space of time their new purchases will begin to appreciate. But will investors rid themselves of cheapened goods this time around for the same reasons? Or will they gamble on an upturn in the New Year?

All of the other indices registered small drops too, although they too are all still up year on year and at times on the year to date in the case of the Fine Wine 500 and Fine Wine Investables indices.