Magnums vs. 750s for Long Term Investment

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What is the best investment format for age worthy old world wines (20YRs)?

750
24
34%
Mag
38
54%
Double Mag
8
11%
 
Total votes: 70

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Sh@n A
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Magnums vs. 750s for Long Term Investment

#1 Post by Sh@n A » June 24th, 2019, 11:35 am

I believe most online resources suggest going with magnums for investment, due to their slower aging profile, rarity, and larger mass (which can withstand temperature swings better). A reputable retailer has taken the other side, saying (i) the past decade has seen a shift in preferences [except for very old vintages] driven by newer markets out of HK/Asia who are less interested in large formats, (ii) 750s generally liquid (e.g., 24/7 bid for 750s, but not necessarily the case for mags). This would be Bordeaux (1st) which can comfortably age 20YRs in a 750 format in a good vintage, so the time advantage of the magnum is a little less so important?

Do folks agree with this shift to 750s?
Do Magnums only make sense these days if you are looking to age 30+ years?
Would your poll vote change if it was not 20YRs, but say 10YR or 50YR?
If you prefer Magnums, at what % premium over like-for-like 750ml bottles is 'too much' to pay? 10%? 15%? 20%?
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Re: Magnums vs. 750s for Long Term Investment

#2 Post by Russell Faulkner » June 24th, 2019, 11:37 am

If I want to drink it. Magnum

If I want to sell it. Bottle

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Re: Magnums vs. 750s for Long Term Investment

#3 Post by YLee » June 24th, 2019, 12:13 pm

I personally don't know why people would want to buy wine as an investment.
I can make so much more investing in stocks or property.

That said, if I had to pick it I would think you would get more bids for 750 than any other sizes.
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Re: Magnums vs. 750s for Long Term Investment

#4 Post by Jason T » June 24th, 2019, 1:05 pm

YLee wrote:
June 24th, 2019, 12:13 pm
I personally don't know why people would want to buy wine as an investment.
I can make so much more investing in stocks or property.

That said, if I had to pick it I would think you would get more bids for 750 than any other sizes.
No doubt there are a handful who have made good money investing in wine. However the (vast) majority are likely unable to comprehend/assess the risks associates with wine investment, as well as the unique costs (storage, insurance, auction premiums etc)
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Re: Magnums vs. 750s for Long Term Investment

#5 Post by Sh@n A » June 24th, 2019, 4:03 pm

Votes are more split 50/50 (thus far)
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Re: Magnums vs. 750s for Long Term Investment

#6 Post by Kelly Walker » June 24th, 2019, 6:45 pm

Mags only for Champagne
White wines matter

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Re: Magnums vs. 750s for Long Term Investment

#7 Post by Rauno E (NZ) » June 24th, 2019, 8:46 pm

Putting aside the follies of "investing" in wine, I think magnums are the way to go. All the reasons OP has listed, and not too big for most consumers. Just because people in some markets struggle to finish a 750ml doesn't mean we should drop standards ;)!
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Re: Magnums vs. 750s for Long Term Investment

#8 Post by Tom Reddick » June 24th, 2019, 10:58 pm

The margin has narrowed some in recent years, but for most regions the magnum is still going to get you the better return overall- especially as the wines get older.

For drinking purposes, most of the few really knowledgeable collectors I know whose experience goes back to pre-phylloxera times will tell you that the magnum is the ideal format for very long term aging. If you have access to their archive- noted collector Bud Moon of Houston wrote a superb opinion piece on this in the Wine Spectator many years ago. That op-ed sums it up quite perfectly. But remember that we are talking very long term here- in other words wines you would be buying long after their original release. The argument is far less compelling if you are drinking the wines within 20-30 years for the most part.

On the other hand- if you, like many, are planning to drink the wines but want to take a bit of an investor approach to ensure you get the best return in case you are eventually forced to sell the bottles, then I would say go the route that best suits your drinking habits. From a drinking perspective- having double the number of bottles makes quite a difference, especially if you find yourself needing to sell part of your collection but still able to hold a few back. I am not sure the magnum premium "just in case" is worth disrupting the value of having more actual bottles in the 750 format.

3L and larger formats are not a great investment. Even in the 3L size, I have observed the risk of leakage goes up, and at auction such bottles sometimes sell for an incredible premium, and sometimes not at all. Much more volatile pricing there.
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Re: Magnums vs. 750s for Long Term Investment

#9 Post by Russell Faulkner » June 24th, 2019, 11:19 pm

There’s certainly more liquidity with 750s.

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Re: Magnums vs. 750s for Long Term Investment

#10 Post by Herwig Janssen » June 24th, 2019, 11:33 pm

Magnums are the real deal . I don’t care too much about resale value but the wine is in general just so much better . Compare Pichon Comtesse 82 in bottle and magnum and the difference is huge . The bottle is fully ready and shows elements of aging while the mag is still fresh . Agree that you need 30 to 40 years to show the real difference .
Don’t buy larger formats with age . In those days , the corks were not good and most large formats that are old today leak . Today , they probably know better what to do and I buy on occasion but it is not practical .

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Re: Magnums vs. 750s for Long Term Investment

#11 Post by Mark Golodetz » June 25th, 2019, 3:40 am

From an investment point of view, magnums. From a drinking point of view, and you are planning to hold onto the wines, also magnums. But for a Berserker, who tends to like to sample multiple bottles at a sitting, fifths.

Personally, I love to serve magnums to four people. In most dinner gatherings, there will be at least one person who is actually not that interested in wine, and a magnum tends to reduce the winespeak part of the evening. Almost every time I am dining non wine friends, I will serve magnums. The bottle is impressive, and once served takes a back seat in the conversation. My biggest problem serving multiple magnums is finding large enough decanters. (BTW this is a huge problem with really large bottles. With imperials, you have to have a row of decanters ready, which is often a quite messy).
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Re: Magnums vs. 750s for Long Term Investment

#12 Post by Kirk.Grant » June 25th, 2019, 4:42 am

Russell Faulkner wrote:
June 24th, 2019, 11:37 am
If I want to drink it. Magnum

If I want to sell it. Bottle
this...100%
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Re: Magnums vs. 750s for Long Term Investment

#13 Post by Bob Davis » June 25th, 2019, 6:06 am

YLee wrote:
June 24th, 2019, 12:13 pm
I personally don't know why people would want to buy wine as an investment.
I can make so much more investing in stocks or property.

That said, if I had to pick it I would think you would get more bids for 750 than any other sizes.
I've done both. But selling several vintages of Marcassin wines at an average 4x cost was the best investment we ever made. Sold about 3 years after acquisition. All 750's.
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Re: Magnums vs. 750s for Long Term Investment

#14 Post by BLaird » June 25th, 2019, 7:50 am

The pure pleasure of drinking a bottle of wine remains even if it's a loss financially. The same can't be said for the stock market or real estate. Which is why I only invest in wines I would enjoy drinking myself. I find I can never lose. [cheers.gif]
YLee wrote:
June 24th, 2019, 12:13 pm
I personally don't know why people would want to buy wine as an investment.
I can make so much more investing in stocks or property.

That said, if I had to pick it I would think you would get more bids for 750 than any other sizes.
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Re: Magnums vs. 750s for Long Term Investment

#15 Post by Nick Gangas » June 25th, 2019, 12:15 pm

Watching the auction market, if you are talking Rousseau chamberlain or Roumier Bonnes Mares. There is a nice premium for mags. If you are not talking at this level then I would advise you do not invest.

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Re: Magnums vs. 750s for Long Term Investment

#16 Post by YLee » June 25th, 2019, 12:53 pm

BLaird wrote:
June 25th, 2019, 7:50 am
The pure pleasure of drinking a bottle of wine remains even if it's a loss financially. The same can't be said for the stock market or real estate. Which is why I only invest in wines I would enjoy drinking myself. I find I can never lose. [cheers.gif]
YLee wrote:
June 24th, 2019, 12:13 pm
I personally don't know why people would want to buy wine as an investment.
I can make so much more investing in stocks or property.

That said, if I had to pick it I would think you would get more bids for 750 than any other sizes.
I agree with you on that because you arent really buying just for investment purposes. You buy what you like and if it goes up enough for a profit, sure why not.
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Re: Magnums vs. 750s for Long Term Investment

#17 Post by Sh@n A » June 25th, 2019, 2:01 pm

Larger formats now winning out (on the clickable poll). What I find interesting is some folks prefer drinking out of magnums but going for 750 for investment... I personally believe markets are efficient over the very long term, so if people prefer drinking out of magnums, then the magnum premium is justified and at equivalent would be the better investment at equivalent price to the 750ml (e.g. EP). But often the magnums are at entry purchase, so the question would then evolve into tracking magnum premium evolution at auction over time.... for which there is no great data set as the magnum premium for wines made 30YRs ago (when wine making/storage was perhaps more volatile) may not be relevant for the next 30YRs.... and indeed the answer may not be obvious enough for one to assume the modestly greater illiquidity (depending on the bottle/vintage).
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Re: Magnums vs. 750s for Long Term Investment

#18 Post by R@y.Tupp@+sch » June 25th, 2019, 2:14 pm

Except for a few types of wine - Port, Sauternes etc, the premium for older wines at auction is significantly higher for magnums.
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Re: Magnums vs. 750s for Long Term Investment

#19 Post by James Kennedy » June 25th, 2019, 8:14 pm

Based on my recent (online) auction experience, 750s sell at higher price points than mags. With my anecdotal experience selling identical wines in different sizes, 750s are coming in about 20% higher price by volume. Examples are American wines ranging from 3-15 years old.

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Re: Magnums vs. 750s for Long Term Investment

#20 Post by Jürgen Steinke » June 26th, 2019, 5:52 am

Investing in wine is risky as is investing in anything else. Who knows what the world and the economy is in 30 years? Drinking wine is part of the modern lifestyle. Cognac was in fashion 30 years ago. Its a pretty small market today. And furthermore the prices for iconic wines are very high today.

I recommend that people enjoy wine with friends around the lunch or dinner table. That is what wine is made for.

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Re: Magnums vs. 750s for Long Term Investment

#21 Post by Mark Golodetz » June 26th, 2019, 6:12 am

James Kennedy wrote:
June 25th, 2019, 8:14 pm
Based on my recent (online) auction experience, 750s sell at higher price points than mags. With my anecdotal experience selling identical wines in different sizes, 750s are coming in about 20% higher price by volume. Examples are American wines ranging from 3-15 years old.
The sampling of young American wines is probably not representative. There is sense in the market place that they may not age as well as their European counterparts, so it doesn’t matter as much if you buy fifths or magnums. There are exceptions of course, for instance, there is a premium for large format Ridge, which does have a history of longevity. As with anything else, quality and rarity will dictate the market.

There is still a strong and vocal section of this board who feel buying wine for investment is anathema. While I sympathize and understand that there is purity in never selling a bottle of wine, wine is a commodity, and Investors are a significant part of the market. They take delivery, pay the costs of storage, insurance, opportunity cost, and release it as they see fit. They need to show that it has been perfectly stored, so periodically they bring back to market immaculate product. As has been said, it is a risky thing, and for the most part costs exceed returns. Not lately though, particularly for Burgundy, but at some stage, even the wealthiest of consumers will balk at paying four figures for a slightly better than average bottle, and even here we will see some correction.
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Re: Magnums vs. 750s for Long Term Investment

#22 Post by Chris Blum » June 26th, 2019, 6:18 am

Wine as an investment vehicle? ....good luck.
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Re: Magnums vs. 750s for Long Term Investment

#23 Post by James Kennedy » June 26th, 2019, 3:46 pm

Mark Golodetz wrote:
June 26th, 2019, 6:12 am
James Kennedy wrote:
June 25th, 2019, 8:14 pm
Based on my recent (online) auction experience, 750s sell at higher price points than mags. With my anecdotal experience selling identical wines in different sizes, 750s are coming in about 20% higher price by volume. Examples are American wines ranging from 3-15 years old.
The sampling of young American wines is probably not representative. There is sense in the market place that they may not age as well as their European counterparts, so it doesn’t matter as much if you buy fifths or magnums. There are exceptions of course, for instance, there is a premium for large format Ridge, which does have a history of longevity. As with anything else, quality and rarity will dictate the market.

There is still a strong and vocal section of this board who feel buying wine for investment is anathema. While I sympathize and understand that there is purity in never selling a bottle of wine, wine is a commodity, and Investors are a significant part of the market. They take delivery, pay the costs of storage, insurance, opportunity cost, and release it as they see fit. They need to show that it has been perfectly stored, so periodically they bring back to market immaculate product. As has been said, it is a risky thing, and for the most part costs exceed returns. Not lately though, particularly for Burgundy, but at some stage, even the wealthiest of consumers will balk at paying four figures for a slightly better than average bottle, and even here we will see some correction.
Ridge Monte Bello is the exact wine I was referencing. 03, 08, 14 and 16 were the vintages

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