Alternative investments: valuation of wine as a means for portfolio diversification
This article analyses wine as an alternative investment tool and its relevance for investment portfolio diversification. Advantages and disadvantages of alternatives, benefits and weakness and peculiarities of investing in wine are systemised. In addition, the article looks at statistical data analy...
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| Format: | Article |
| Language: | English |
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Vilnius Gediminas Technical University
2015-03-01
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| Series: | Business: Theory and Practice |
| Subjects: | |
| Online Access: | https://journals.vgtu.lt/index.php/BTP/article/view/8308 |
| _version_ | 1797332773188403200 |
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| author | Daiva Jurevičienė Agnė Jakavonytė |
| author_facet | Daiva Jurevičienė Agnė Jakavonytė |
| author_sort | Daiva Jurevičienė |
| collection | DOAJ |
| description | This article analyses wine as an alternative investment tool and its relevance for investment portfolio diversification. Advantages and disadvantages of alternatives, benefits and weakness and peculiarities of investing in wine are systemised. In addition, the article looks at statistical data analysis of fine wine market and compares wine with other investment tools. The examination is based on three investment instruments: US equities (using S&P 500 index), bonds (using US 20-Year treasury constant maturity rate/DGS20) and wine (based on Fine Wine Investable index) using 1993–2012 (end of year) data. The investment portfolios made with two and three above-mentioned investment tools basing on H. Markowitz’s investment portfolio theory and effective curves are presented. It was found that return on investments only from equities and bonds or wine and one of these traditional instruments are signally less than from the investment mix of all three tools. Furthermore, portfolios made only from equities and bonds provide the lowest return compared to others. Choosing from two investments portfolios, results of bond/wine portfolios propose higher return with the same risk level compared to equities/wine portfolio. Consequently, despite some slowdown of wine index during financial crises, wine relevance for portfolio diversification in post crises period was proved. |
| first_indexed | 2024-03-08T07:54:09Z |
| format | Article |
| id | doaj.art-cbc8d7331e7d45a3938f43d51049b3c5 |
| institution | Directory Open Access Journal |
| issn | 1648-0627 1822-4202 |
| language | English |
| last_indexed | 2024-03-08T07:54:09Z |
| publishDate | 2015-03-01 |
| publisher | Vilnius Gediminas Technical University |
| record_format | Article |
| series | Business: Theory and Practice |
| spelling | doaj.art-cbc8d7331e7d45a3938f43d51049b3c52024-02-02T14:32:41ZengVilnius Gediminas Technical UniversityBusiness: Theory and Practice1648-06271822-42022015-03-0116110.3846/btp.2015.606Alternative investments: valuation of wine as a means for portfolio diversificationDaiva Jurevičienė0Agnė Jakavonytė1Mykolas Romeris University, Ateities g. 20, LT-08303 Vilnius, LithuaniaVilnius Gediminas Technical University, Saulėtekio al. 11, LT-10223 Vilnius, LithuaniaThis article analyses wine as an alternative investment tool and its relevance for investment portfolio diversification. Advantages and disadvantages of alternatives, benefits and weakness and peculiarities of investing in wine are systemised. In addition, the article looks at statistical data analysis of fine wine market and compares wine with other investment tools. The examination is based on three investment instruments: US equities (using S&P 500 index), bonds (using US 20-Year treasury constant maturity rate/DGS20) and wine (based on Fine Wine Investable index) using 1993–2012 (end of year) data. The investment portfolios made with two and three above-mentioned investment tools basing on H. Markowitz’s investment portfolio theory and effective curves are presented. It was found that return on investments only from equities and bonds or wine and one of these traditional instruments are signally less than from the investment mix of all three tools. Furthermore, portfolios made only from equities and bonds provide the lowest return compared to others. Choosing from two investments portfolios, results of bond/wine portfolios propose higher return with the same risk level compared to equities/wine portfolio. Consequently, despite some slowdown of wine index during financial crises, wine relevance for portfolio diversification in post crises period was proved.https://journals.vgtu.lt/index.php/BTP/article/view/8308alternative investmentsinvestment portfolioportfolio diversificationfine winewine market indexesthe Liv-ex |
| spellingShingle | Daiva Jurevičienė Agnė Jakavonytė Alternative investments: valuation of wine as a means for portfolio diversification Business: Theory and Practice alternative investments investment portfolio portfolio diversification fine wine wine market indexes the Liv-ex |
| title | Alternative investments: valuation of wine as a means for portfolio diversification |
| title_full | Alternative investments: valuation of wine as a means for portfolio diversification |
| title_fullStr | Alternative investments: valuation of wine as a means for portfolio diversification |
| title_full_unstemmed | Alternative investments: valuation of wine as a means for portfolio diversification |
| title_short | Alternative investments: valuation of wine as a means for portfolio diversification |
| title_sort | alternative investments valuation of wine as a means for portfolio diversification |
| topic | alternative investments investment portfolio portfolio diversification fine wine wine market indexes the Liv-ex |
| url | https://journals.vgtu.lt/index.php/BTP/article/view/8308 |
| work_keys_str_mv | AT daivajureviciene alternativeinvestmentsvaluationofwineasameansforportfoliodiversification AT agnejakavonyte alternativeinvestmentsvaluationofwineasameansforportfoliodiversification |