All posts tagged: Brexit

On Brexit and the international fine wine trade

Alan Livsey, an Oxonian on the FT’s Lex team has aptly started his wine-commentary piece on the FT as follows: “Fine wine does not take well to shaking – sloshing the sediments around the bottle only muddles the product inside”. There has been plenty of sloshing going around, as Livsey has noted in the same piece. There are tales of booms and busts, sticky prices and the likes. This is especially true when it comes to Bordeaux en primeur – a system that is very near the point of breaking, only to be saved from its brink of doom by a very good vintage. Even so, there are plenty of criticisms on early bottling, unfinished products and so on, which makes you wonder when will the barrage ever stop. But with cheap and abundant shell suppliers, I doubt the barrage will ever end. I am not here to discuss the limitations of the Bordeaux fine-wine market and its en primeur system. I am here to talk about Brexit and its implications on the UK fine-wine scene and the dynamics …

Brexit in a glass

One week on… let’s look at some wine vocabulary that also appears in the Brexit news. Can wine inform our understanding of Brexit related attitudes? (If you’re new to these posts, I’d recommend looking here first to understand what these wine-note visualizations are about.) An Isomap reduction of Brexit related wine-tasting vocab shows power orbited by seductiveness, with ominous words like pit, cut, hole and loose nearby. The picture suggests that power can move into expensive or complex but not both. As you move upwards from power, you get sickly, disjointed, sour. On the right it may get exciting and energetic. The further you leave the complexity behind, the more overwhelming it gets, by Gove! Through the PCA lens (our preferred view in previous posts on tasting note visualization), power lies closer to austerity. In both pictures, there’s some bitterness over access. Whatever the reasons May be, there also seems to be a seductive connection between  intrusive  and  borderline. The consolations of coffee and alcohol are linked to rising unpleasantness. So there you have it: wine-tasting visualizations can double as guides through essential Brexit concepts and the links between them. A glass of wine may improve political acuity. We form natural …

Wine investing and trading IV: Market sentiment and activity

In the penultimate blogpost of this series on wine investing and trading, I shall discuss two metrics which we have developed here at WineQuant to characterise market sentiment. The first metric is called the WQ Spread. It takes into account the monthly highs, lows and average trading values for a particular wine. It is designed to summarize the state of market sentiment. Market sentiment is healthy when the WQ Spread is stable over a sustained period of time. The way we see it, market stability means solid trading activity. On the other hand, volatility in the WQ Spread signifies negative sentiment. In this case, we would expect little or only sporadic activity. Let’s look at examples of these two scenarios, using Lynch-Bages 2010 and Haut-Brion 2010 as our pin-ups. An example of the WQ spread over time is shown below. This is Lynch-Bages 2010 between October 2012 and January 2016. Looking at the development of the WQ Spread over time, we see that market sentiment for Lynch-Bages 2010 has been positive and stable except for a blip in June …