BORDEAUX ‘LOOKS UNDERVALUED RIGHT NOW’
24th February, 2021 by Lucy Shaw
Having flirted with Italy, investors are “turning strongly back to Bordeaux” as the wines “look under priced” at the moment, according to one fine wine merchant.
Speaking to db, Matthew O’Connell, head of investment for Bordeaux Index, said: “Bordeaux is very attractive at the moment and has a lot of momentum in the market, despite the fact that a lot of the noise last year was about other regions.
“Within Bordeaux, there are interesting investment opportunities across the first growths, super seconds and top Right Bank properties, but the real activity at the moment is centred around the first growths, with an increasing number of people thinking that these wines look under priced.
“Some of the older vintages are starting to see significant upticks in price as there is a lot of demand and less supply, so the prices are moving more quickly.”
While O’Connell pointed out that the fine wine market is “a lot more diverse than it used to be”, he revealed that Bordeaux was still at the core of active daily trading on Bordeaux Index’s trading platform, LiveTrade.
“People are turning back to Bordeaux as the wines look cheaper than they should be right now. Investors have confidence in Bordeaux due to its consistency, longevity and track record,” he said.
For those looking to invest in classed growth claret this year, O’Connell’s tips are the 1996, 1998 and 2000 vintages, which he said are “looking very attractive right now, and there’s also some value in the 2015s.”
“Outside of the first growths, investors should be looking at estates like Pichon Lalonde, Figeac and Palmer to name just three. The 2009 and 2010 vintages are also being actively traded – it’s hard to overstate the interest in activity in Bordeaux trading at the moment,” he said.
As for fine wine’s performance this year, O’Connell is optimistic for a strong year of trading. “We’re bullish about the market this year. In addition to the interest in Bordeaux, buying patterns in Burgundy are also very strong.
“We’ve had three years now without significant gains in the market, so I think we’re posed for a significant uptick this year. Momentum is gathering for a really positive year,” he told db.