Believe it or not, investing in wine can be a clever way of diversifying your investment portfolio. Instead of thinking of wine as ‘babelas kos’, view it as shares that are traded on stock exchanges around the world!

Launched in 2000, the Fine Wine Exchange in London is an electronic trading platform with an index called the Liv-Ex 100 (www.liv-ex.com) which tracks the prices of 100 wines - with wine heralding mostly from French regions such as Bordeaux, Burgundy and Champagne as well as the best wines from Italy, Germany, Spain, Portugal and the New World (SA falls into this category).

A few considerations when buying wine:

1. Where’s the wine from?

Look for good growth reds from the Bordeaux region such as Latour and Lafite (probably the best wines in the world). Other regions to consider are Burgundy, Champagne and the Rhone region.

2. How long can you keep the wine?

This depends on the grape variety. Red wines such as Cabernet Sauvignon, Syrah or Shiraz are prime candidates for long-term aging. White wines such as Riesling and Chenin Blanc will also age well.

3. Does the wine have a track record of consistent appreciation?

Looking at the Fine Wine Exchange, it will be clear that Bordeaux is the region to invest in. Apart from Latour and Lafite, look for Chateau Margaux (my favourite!) and Haut Brion. Also consider Burgundy wines such as Domaine de la Romanee-Conti, Coche-Dury, Comtes Lafon and De Vogue.

4. Can you sell it?

For the wine to be an investment, it has to be sellable. Venues for selling are auctions, to a merchant or broker, but be careful with these guys as they can be snakes! And make decisions based on what the market wants, not on your own personal taste.