Title: A study of the performance of fine wine on the Swiss market

Authors: Philippe Masset; Jean-Philippe Weisskopf

Addresses: Ecole hôtelière de Lausanne, HES-SO//, University of Applied Sciences Western Switzerland and Bordeaux, Wine Economics, Route de Cojonnex 18, 1000 Lausanne 25, Switzerland ' Ecole hôtelière de Lausanne, HES-SO//, University of Applied Sciences Western Switzerland and Bordeaux, Wine Economics, Route de Cojonnex 18, 1000 Lausanne 25, Switzerland

Abstract: This paper studies the price evolution and the performance of an investment in fine wine on the Swiss market over the period 2002-2012. Using a repeat-sales-regression approach we calculate different wine indices based on auction hammer prices obtained by Steinfels Weinauktionen. Our results show that different fine wines followed a similar evolution across the sample period but that the amplitude of returns strongly depended on wine regions and types. While Bordeaux and Burgundy wines performed well, wines from the Rhône valley and Italy show a poorer performance. Compared to financial assets wine has significantly outperformed stocks, but not bonds. We further find that the Swiss franc appreciation has had a significant impact on wine prices.

Keywords: fine wines; Switzerland; wine auctions; hammer price; alternative investment; portfolio diversification; CAPM; repeat-sales regression; foreign exchange; price evolution; wine prices; investment performance; stocks; bonds.

DOI: 10.1504/IJESB.2016.079966

International Journal of Entrepreneurship and Small Business, 2016 Vol.29 No.4, pp.566 - 582

Available online: 11 Oct 2016 *

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