• Home
  • About
  • Advertise
  • Contact
  • Policy
  • Guest Post
  • Archive

One Cent At A Time

A Personal finance blog to get rich

  • Email
  • Facebook
  • Pinterest
  • RSS
  • Twitter
  • Beautiful Life
  • Becoming Rich
  • Beginners Guide
  • Extra Income
  • Productivity
  • Saving Money

Alternative Investment Gold and Wine

August 29, 2015 11 Comments

Share this:

  • Tweet
  • Email

In recent past we have seen gold prices coming down and it is predicted to come down further by the year-end. where as wine as an investment is gaining momentum and expected to increase further,as per Bloomberg news. Enjoy this guest post which discusses this matter further.

Alternative Investment Gold and Wine

Gold and Wine that have been tracking each other’s prices for over a decade have finally diverged. As a result, it is essential to analyze the reasons behind this trend as several investors are losing faith in bullion.

The gold and wine prices have been tracking each other for well over a decade now. However, the demand for these assets is now diverging from their former trend, as the gold bullion slumped down into a bearish market.

Investors have been losing faith in the yellow metal as a storehouse of wealth. In the previous 10 years, the LIVX 100 which is the premier index for fine wine, rose over three times while gold went on to gain four times for the same duration.

While experts are of the opinion that the yellow metal may drop to about $1000 an ounce by the end of the year, leading to a 21 percent loss, the outlook for wine on the other hand is much pleasant with an expected rise of about 8 percent by 2014.

A look at gold and wine

Over the past decade, the bond yields were tumbling to a low bottom, the equities too were spiraling down, and the central banks all over the world were busy flooding the markets with unprecedented levels of quantitative easing.

Gold on the other hand held firm with gold ETFs that exceeded the reserves of almost all the Central Bank reserves of the world. It is important to understand what the deviation of these physical assets actually means.

It is well understood that both Gold and Wine are two different commodities with a unique intrinsic value pertaining to each asset.

However, the general trend in a poor economy favors wine. This is exactly what we are observing at this juncture, as the governments worldwide are busy flooding the markets with paper currency. This is something that may lead to a severe inflation if not checked in time.

The price of gold

The value of gold fell for the first time in January this year, after having the longest bull market in over 9 decades. Later this April, the prices slumped below the previous low observed in September 2011.

Wine on the other hand lost by about 29 percent since 2011, and currently is priced at about 276. Experts believe that it may scale up to about 300 by the end of this fiscal year. Both wine and gold began 2013 with about 3 percent drop for S&Ps and about 10 percent gain in MSCI.

As per the LIVX 100, which tracks over 100 prominent and sought after varieties of wine, the fine wine trade has been valued at over $4 billion globally.

About 9 to 10 percent of this value is transacted through auctions. Gold on the other hand, is traded at an average of about $34.5 billion on a daily basis.

Experts are of the opinion that if the present trend continues, the precious metal may trade well below the $1000 mark in a matter of only 5 years. Similarly, they also opine that the rally in wine will not continue for a long time, as the current rise in the prices is probably due to the correction in the prices.

I don’t have investment in gold or in wine. It would be interesting to see how wine as an investment would do. I previously posted Gold or Silver as an investment option. Honestly I didn’t know about wine investment prior to reading this article. I may have to do some more research on wine investment.

Loosing value of gold is actually good news for me. We can continue to invest in gold as long as it is in affordable range.

Here’s my question to you, do you have any investment in wine or gold? Are you planning to shuffle your investment to go with the new trend?

LIKE THIS POST?
I agree to have my personal information transfered to MailChimp ( more information )
Join our community of 8000+ subscribers to increase your net worth and build wealth
We hate spam. Your email address will not be sold or shared with anyone else.

Share this:

  • Tweet
  • Email
The tool that changed the way I manage my personal finance - Personal Capital, The Best Free Personal Finance Tool

Want to start a WordPress blog now? The onecentatatime.com blog is hosted by Siteground Web Hosting. For only $3.95 a month, Siteground can help you set up and host your website/blog quickly and easily.

About the Blogger Hi I am SB, a personal finance enthusiast with a career in software development. I am an immigrant to the USA since 2005, after being born and brought up in India. This 40 something technocrat lives and breathes personal finance whenever he gets time from the day job, job as a husband and a dad

Some links on this page may be affiliate links, if you make a purchase following the links, I may earn a commission. Read affiliate disclosure here
« Planning for money and Wealth Inheritance
How I Turned My Impulse Buying Into Saving »

Comments

  1. Little House says

    July 8, 2013 at 9:59 AM

    Wine or alcohol in general (like whiskey) is an interesting investment idea. A few months back, Mr. LH started thinking about buying bottles of whiskey and keeping them for 20 years as an investment. It’s something we talk about every now and then but maybe we should investigate this a little further (especially wine.)

    Reply
  2. Joe @ Midlife Finance says

    July 8, 2013 at 12:16 PM

    Wine would be a terrible investment for us. They would all end up in our tummy. 🙂

    Reply
  3. Martin says

    July 9, 2013 at 12:36 AM

    I still think that gold will go up in long term and all this selling is just overreaction. Investors expected inflation and they think it didn’t happen. But just look at the prices in grocery stores, gas stations and other goods out there. And I believe we haven’t seen everything yet. Where the money are flowing now? It is not bonds, it is dollar! They are buying dollar which in my opinion is a future bubble. People like Bernanke and Soros want dollar trashed, so from the long term perspective, this is not sustainable. Well, it may take time before gold starts growing again, it may also be quick. For me it provide a great buying opportunity and i will be adding more shares to my portfolio.

    Reply
  4. Thomas | Your Daily Finance says

    July 9, 2013 at 11:47 AM

    Never thought about wine as an investment since we don’t know what is good vs bad vs great. Would end up being a waste of money at this point simply because we have no idea what we would be doing. I would still like to get into purchasing some gold but not right now. Still a little too pricey for me. But at the right price it would be a bargain and gold tends to always bounce back.

    Reply
  5. Herbert says

    July 10, 2013 at 7:23 AM

    Seems like every other investment avenue out there wants to replace the authority of gold as a portfolio diversifier and safe-asset. I stumbled upon a post about SWAG investing. Wondering what’s that? Find it out for yourself. Hope it proves of interest.

    Reply
  6. Michael says

    July 10, 2013 at 11:42 AM

    The best thing about wine is that if the value goes down, you can drink it and drown yur sorrows. 🙂

    Reply
    • Michael says

      July 10, 2013 at 11:44 AM

      Umm. *your*. You can drown *your* sorrows….

      Reply
  7. [email protected] says

    July 11, 2013 at 5:58 AM

    My wife likes to drink a very inexpensive wine called Cul De Sac. It used to cost $2.87 but now we have to shell out $3.33 for a bottle. I guess you are right, the price of wine is going up. 🙂

    Reply
  8. Joshua Rodriguez says

    July 11, 2013 at 3:00 PM

    I agree with Micheal! If the value of wine goes down, then down the bottles! I’d rather invest in gold since it would be much easier to store and less tempting to consume.

    Reply
  9. Anton Ivanov says

    July 11, 2013 at 7:04 PM

    I wouldn’t consider wine as an investment either. Didn’t even know that had an ETF for it. But I’m not a big fan of alternative investments, as my equity portfolio and rental properties have done quite well over the last half a decade.

    Reply
  10. Aroon says

    August 7, 2013 at 12:44 PM

    I disagree with the idea that a poor economic times favor strong wine prices. When the economy is down, people won’t have the purchasing power to buy wine and alcohol. The same cannot be said about gold because this precious metal tends to increase in value during inflation and tough economic times.

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.



Create your own blog in 20 minutes and $20

Personal Capital, a free tool to change your financial health today

I use and suggest Upstart, for your personal loan need

CreditKarma, a free tool to check your credit scorey

I use Coinbase, for my crypto investments

101 Cents at a Time

101 Ways to Earn Extra Money on the Side
201 Frugal and Perfect Birthday Gifts
101 Ways to Save Money Everyday
101 Ways to be Better and Successful at Work
101 Ways to Save Environment and Energy
101 Frugal and Romantic Anniversary Ideas
101 Low-Cost Men's Fashion Ideas
101 Personal Finance Tips
101 Ways to Reuse Household Stuff
101 Things to Do, When Nothing to Do
101 College Graduation Gift Ideas
100 Tips for Ecommerce Startup
101 Ways to Enjoy Indoor During Winter
101 Ways to Beat Procrastination

Popular Posts

Quick Cash - How to make $100 legally, in a day
Living well on less than $15,000 a Year
Top survey sites for side income
What to do when auto repair goes wrong
Where should I invest my money now?
20 Ways to be productive and happy at work
51 Ways to get out of debt
Be a better person in 15 days, 15 ways
Income ideas for retirees and senior citizens
51 side jobs for college students
Urgently need a large amount of money?
Should I buy or should I rent?
Best Personal loan providers
25 Ways to save environment
25 DIY car repairs to save money
How to decorate office cubicle
How to show your wife you care
50 Financial Rules for Success
51 Frugal weekend family activity ideas
Become Rich By Saving 1 Hour Of Daily Wage
How much do I need to save for retirement?
How to negotiate your salary

Follow us on FaceBook

About Author

SB

Blogger by choice and IT manager by profession. Finance is my passion and gardening is my greatest satisfaction. Born in India, settled in US, Husband and a father. I created this blog in 2011 with a vision to help others. Thanks for your patronage. More info on my "about" page.

View all posts


Subscribe

Join our community of 5000+ subscribers to increase net worth and build wealth

Advertisements

Personal Stories

How I got a new HP computer replaced
Was COVID circulating in USA in fall of 2019?
How my credit score went up 800+
Why I didn’t invest in Bitcoins
How I controlled impulses to buy things
Why this blog is named One Cent at a Time

Subscribe via Email

Site Disclaimer

Disclosure of Material Connection: Some of the links in this web site are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”
Read full Affiliate disclosure


One Cent at a Time is published by SB. The opinions expressed herein by him are his own and not those of his employer or anyone else. All content on One Cent at a Time is for entertainment purposes only. By reading this blog, you agree that SB and/or One Cent at a Time is not responsible for any actions taken after reading this blog. For the full disclaimer, click here .

Major Media Mention

One Cent at a Time Media Appearances

Copyright © 2023 One Cent At A Time · Designed by Nuts and Bolts Media