Has the speculation on DRC wines gone too far?

In a recent paper published on the Liv-Ex blog, the author questions the sustainability of the 285% gain on DRC wines over the past 10 years. This is twice the performance of the Liv-Ex Fine Wine 50 Index over the same period!

Has the speculation on DRC wines gone too far?

In a recent paper published on the Liv-Ex blog, the author questions the sustainability of the 285% gain on DRC wines over the past 10 years. This is twice the performance of the Liv-Ex Fine Wine 50 Index over the same period!

In a recent paper published on the Liv-Ex blog, the author questions the sustainability of the 285% gain on DRC wines over the past 10 years. This is twice the performance of the Liv-Ex Fine Wine 50 Index over the same period! 

DRC_First_Growths-1.png

On the Liv-EX diagram, on can see that the DRC:First Growth ratio has reached a high of 6.11: 1 in November 2015. The recent high was 1.83 standard deviations from the mean average for the ten-year period.

It is interesting to observe that on the flipside, the DRC:First Growth ratio bottomed out at -1.82 standard deviations below the mean average for the ten-year period.

These figures should be enough to alert the speculators and collectors on the sustainability of the DRC skyrocketing prices, but, according to Liv-EX, the right conclusion is exactly the opposite: the measurement tool, dominantly indexed on Bordeaux Grands Crus performances is what doesn't work. Just weeks prior to the Bordeaux Primeurs campaign, the real interrogation question is on the evolution of the Grands Crus prices. 

 

 


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