The leading lights of the wine-making world may be French and Italian, but when it comes to wine trading, all eyes fall on London.
London is the epicenter of what is the most developed commodity market for fine wine in existence-based in the UK. The roots of it lie deep in history, stretching back 900 years to the time of Henry II when the British ruled Bordeaux. The import-export links that were established during this time grew into a booming trade, and since then British passion for wine has never relented. If you visit the UK as a fine wine enthusiast today, you’ll find an unparalleled trading infrastructure, and a pool of international buyers and sellers that’s quite simply the biggest there is.
The attraction of the UK for wine traders is due in no small part to the London International Vintners’ Exchange-better known as Liv-ex. It’s no exaggeration to say that since Liv-ex was founded in 1999 by former bankers Justin Gibbs and James Miles, the exchange has revolutionized the fine wine industry. Not only is Liv-ex the world’s leading online marketplace for fine wine, it’s also the wine pricing authority.
Before Liv-ex, if you’d wanted to calculate the market price for a specific wine you’d have had to search through endless paper catalogues and lists. Now, with Liv-ex’s exhaustive database of standardized fine wine prices available online, you can find accurate, up-to-date prices and trading histories at the click of a mouse. Though you may not be able to buy wines at Liv-ex’s wholesale prices-a privilege reserved exclusively for established merchants-the database will give you a good indication of the money you could make on any wines you might wish to sell to a wholesaler.
From their humble beginnings, tucked away in a rented South London office above a pizzeria, Liv-ex has grown to attract a global membership of over 400 professional traders in 33 countries. Estimates suggest that these members now account for 80 percent of the world’s fine wine turnover.
Liv-ex also runs the Fine Wine 100 index, which is the industry’s leading price benchmark. Working in much the same way as the DJ30, the LVX 100 represents the price movement of 100 of the most sought-after wines on the market, and is calculated monthly. The famed Liv-ex blog provides yet another boon for fine wine enthusiasts and traders, with frequent posts on everything from the performance of specific brands to conditions of harvest, industry report summaries and the movement of indices. If you want an authoritative ‘insider’s guide’ to the latest happenings in the global fine wine market, this blog is definitely one to follow.
Private investors may not be able to trade directly on Liv-ex, but if you’re not a trading professional you can still benefit from an invaluable set of online tools specifically tailored to your needs. Cellar Watch ( www.cellar-watch.com ) gives collectors and enthusiasts professional-level access to Liv-ex data, including current and historical fine wine market prices, and recent Liv-ex bids and transactions. With the Cellar Watch Valuation Tool, you can create virtual cellars containing your wines, then monitor and analyze their performance. You can divide your wines into different cellars for investment and drinking if you want to, and even create a fantasy cellar for the wines you’d love to own.
With Liv-ex at the heart of global fine wine investment analysis, pricing and trade, it’s little wonder that there’s such a buzz of activity around the UK fine wine market.