Bordeaux wine futures
CNN Money has a very good article on the trading of Bordeaux futures. This is something that I had heard of, but had only a vague idea of how it worked. The article does a nice job of explaining how it works.
During April tasting week the wine is still maturing in vats and oak barrels. But producers set their prices based on these early orders and gut feelings. Tasters, on the other hand, are betting that their palates can discern whether a mouthful of young wine will mature into a classic, long-lasting, and very expensive Bordeaux along the lines of the 2000 or 2005 vintages – not to mention 1961, 1949, or 1924 – or whether it will turn into at best a pleasant wine but not a particularly memorable or lucrative one (there hasn’t been a truly bad year since 1992).
I wonder how one becomes a taster. Wouldn’t it be cool to put this down as your job description? (emphasis mine)
But when 5,000 wine experts, wholesalers, and importers descend on the Bordeaux region in the first week of April every year to swirl, sniff, and suck mouthfuls of fermenting grape juice before spitting it out noisily into barrel-sized spittoons, they too are engaged in market making.
While investing in these futures does not sound like a very good way to get rich, as the article points out, even if you lose everything you can at least drown your sorrows.
I’ll drink to that.