Liv-ex Liv-ex Liv-ex Liv-ex Investables FTSE S & P

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Market Report July 2017 MARKET DATA: Index Level 30.06.17 M.O.M (%) YTD (%) 1 Year (%) 5 Year (%) Liv-ex 50 346 0.3 3.0 18.3 12.9 Liv-ex 100 307 1.0 3.3 18.3 15.8 Liv-ex 50 0 305 0.9 4.1 17.9 23.

1 Market Report July 2017 MARKET DATA: Index Level M.O.M (%) YTD (%) 1 Year (%) 5 Year (%) Liv-ex Liv-ex Liv-ex Liv-ex Liv-ex Investables FTSE 100 7, S & P 500 2, , 30th June 2017 The fine wine market sustained its growth trend further in June and The Telegraph picked up on the market performance with an article on 3rd July ranking the top ten wines which had delivered over 150% returns in the last five years you can read the article in full at: investment-wines-returned-150pc-five-years. Our July Market report reviews Liv-ex data at the end of the first half of 2017 and this is a good point at which to analyse trends across our usual comparison of fine wine, financial markets and gold. Most notably, June 2017 finally saw the five yearmeasure of the key index, the Liv-ex 100, which monitors the price movements of the 100 most actively traded wines on the secondary market, tip back into double-digit territory for the first time since May This development sees the medium term measurement recovery from the impact of the market decline between See the chart: Five year performance measure January June 2017 for more detail.. The Liv-ex 1,000 the broadest measure of the market focused on wines from across the world using the Liv-ex Mid-Price, has been more robust across the period, and at the end of June 2017 has completed 19 consecutive months of positive growth. Meanwhile, the Liv-ex Investables, which measures 200 wines from the top 24 Bordeaux chateaux which typically will be found in an investment portfolio (longest data range with price measurement since 1988) has also seen a stronger performance across the five year periods measured at the end of each month this year. As a result of the 2014 decline, fine wine when measured recently over the 5-year term has not performed as strongly as financial markets. However, the trend over shorter and longer term measures is a stronger performance from fine wine. Five year performance measure January - June 2017 to the month ends: Asset Liv-ex % 2.9% 3.7% 4.4% Liv-ex Investables 8.0% 7.4% 8.6% 9.2% Liv-ex % 17.7% 19.5% 20.0% FTSE % 23.7% 27.0% 25.6% S&P % 73.1% 67.8% 70.5% -12.9% -6.0% -4.7% -4.4% 9.2% 15.8% 14.6% 20.1% 23.8% 27.9% 41.3% 31.3% 84.1% 77.9% -2.8% -6.5% Continues over:

The fine wine market has seen positive growth since the 4th Quarter of 2015.

There is a view that the market is benefiting from continued political and economic uncertainty and there is still an influence in terms of currency on Sterling stocks of fine wine.

2 The fine wine market has seen positive growth since the 4th Quarter of One-year measures taken at each month end in the first half of 2017 show the Liv-ex wine indices outperforming financial markets and gold as can be seen in the table opposite. There is a view that the market is benefiting from continued political and economic uncertainty and there is still an influence in terms of currency on Sterling stocks of fine wine. We look at the performance of tangible assets; property, gold and fine wine, in more detail in our Special Focus section in this report. One year performance measure January - June 2017 to the month ends: Asset Liv-ex % 24.0% 21.7% 19.8% Liv-ex Investables 23.6% 22.9% 21.5% 19.6% Liv-ex % 21.6% 20.9% 20.4% FTSE % 19.1% 18.6% 15.4% S&P % 22.5% 14.7% 15.4% 22.1% 13.6% 16.0% 11.1% 19.5% 18.3% 19.3% 17.4% 21.4% 27.9% 20.7% 12.4% 15.0% 15.4% 17.8% -6.5% PERFORMANCE: Liv-ex reported that the month of June recorded the highest levels of trade on the exchange so far in The 2016 En Primeur campaign did not impact on the secondary market as the take-up of the new vintage was lack-lustre due to the pricing strategy adopted by the chateaux. The weak demand was in no way a reflection of the quality of the 2016 crop, which has been graded by the trade as an exceptional vintage. Wine Dominus Rousseau, Clos St Jacques DRC, Tache Petit Mouton Rauzan Segla Major Market Movers June th June 2017, (Mid Price 12 x 75) Vintage Region May to June Change (%) USA Burgundy Burgundy Bordeaux Bordeaux Price and scores versus other vintages To illustrate this point, Neal Martin published an average score of the component wines of the Bordeaux 500 at 96.1, an increase on his 2015 s average at Price is an issue: with an average release price of 2,210 per 12 x 75, 2016 is the fourth most expensive release since Even with the third highest average score in that period it is still currently hard for the market to swallow, especially for Sterling buyers who for some may see an increase in the region of 30% in costs ex-negociant. We will continue to monitor price performance closely as the vintage quality is compelling. Looking across the broader market some of the top performers in June can be seen in the table Major Market Movers, which illustrates a continued appetite for the top wines of West Coast USA. In terms of vintage focus, the most actively traded were the Prime 2005, 2009 and 2010, however, across regions, demanded attention with US Dominus seeing 15.8% growth.

REGIONAL MARKET NEWS: Rest Of The World 50 Best Performers, June 2017 Wine Region Vintage May 2017 June 2017 % Change Dominus, California 900 1.042 15.

4 30th June 2017, Market Price per 12 x 75 Last month we reported on a decent US regional performance in May with 4.7% of trade on Liv-ex led by Screaming Eagle and Stag s Leap.

Bordeaux s share of Liv-ex trade rose from 69% in May to 72% in June; Liv-ex reporting that Lafite Rothschild accounted for 12.

3 REGIONAL MARKET NEWS: Rest Of The World 50 Best Performers, June 2017 Wine Region Vintage May 2017 June 2017 % Change Dominus, California Rousseau, Clos St Jacques California ,953 3, DRC, Tache California ,371 2, Petit Mouton Australia ,900 4, Rauzan Segla Spain ,091 2, th June 2017, Market Price per 12 x 75 Last month we reported on a decent US regional performance in May with 4.7% of trade on Liv-ex led by Screaming Eagle and Stag s Leap. This Californian wine rally continued through June with demand for the other West Coast Big Guns; Opus One and Dominus seeing strong price growth. Bordeaux s share of Liv-ex trade rose from 69% in May to 72% in June; Liv-ex reporting that Lafite Rothschild accounted for 12.4% of all trade on the exchange, with second wine, Carruades achieving higher levels of trade than First Growths; Latour, Margaux and Haut Brion. The recently bottled 2014 commanded much of this attention. Burgundy, meanwhile, fell to a 2017 low with 8.8% of trade by value and demand for Italian wines grew, enjoying 17.6% of volume and 8.8% of market value, with Sassicaia 2014 in particular focus. CRITIC S VIEW: Galloni on a rich seam of Cristal Performance comparison of Liv-ex Regional Indices In terms of diversifying your wine portfolio, Champagne offers one of the most stable and consistent price performances. Antonio Galloni, probably the foremost critic of this region, has put the spotlight on one of the leading brands this month with a report on a vertical tasting of Louis Roederer s flagship cuvée, Cristal, from the 1970s. This decade saw nine Cristal vintages bottled, more than any other decade in recent history and Galloni scores them as follows: First created for Alexander II of Russia in 1876 and now a favourite of hip hop stars including Jay Z, Cristal enjoys a broad market and stable price performance. Source: Vinous.com Vintage Galloni Score Market price (12 x 75) ,760 2,628 2,340 8,052 5,688 6,690 6,588 4,944 10,776 TRADE NEWS: Michelin acquire 40% stake in Parker s Wine Advocate: First published by Robert Parker Jnr in 1978, the Wine Advocate has tens of thousands of global subscribers to its wine review publication, and a team of wine critics, considered to be some of the most influential in the industry. It was announced in the trade press in July that Michelin has acquired a 40% stake in the Wine Advocate. The two organisations have already been working together on a number of events and the merger brings together two of the most influential guides to food and wine standards.

Not surprisingly Greater London has seen the sharpest decline in the period 2015 to 2016 with 18% fall in sales, this has rippled out across the South East region where they report levels down 10%.

4 SPECIAL FOCUS HOW DO TANGIBLE ASSETS SUCH AS BRICKS AND MORTAR COMPARE WITH FINE WINE AND GOLD IN THE CURRENT BREXIT FOCUSED ENVIRONMENT? Lloyds Bank has published research on the housing market and it s not all plain sailing! House sales dropped 7% in England and Wales last year and are still down 30% on levels a decade ago. Not surprisingly Greater London has seen the sharpest decline in the period 2015 to 2016 with 18% fall in sales, this has rippled out across the South East region where they report levels down 10%. In fact all regions in England and Wales went into negative territory in this period. The strongest performing regions in 2016 were the East and West Midlands but they were still reporting losses at -1%, followed by the North West (-2%). Investors may also be surprised to learn that London was also the worst performer over the five year period, with only 2% growth in the period to 2016, whereas other regions saw significantly better performance (see the table Property % changes by region, ), with the North West leading at 46%. Region North Yorkshire & Humber North West East Midlands West Midlands East Anglia Wales South West South East Greater London ENGLAND & WALES AVERAGE Property % changes by region, % change % -38% -36% -28% -30% -30% -28% -29% -33% -44% -34% % change % 39% 46% 43% 43% 23% 37% 30% 23% 2% 29% % change % -3% -2% -1% -1% -5% -3% -8% -10% -18% -7% Source: Lloyds Bank boom. The lack-lustre sector performance is put down to a shortage of housing stock, the high costs of moving and insufficient equity or inability to provide large enough deposits. There is no expectation that these trends are going to change any time soon and in fact property sales could fall further in the near future, particularly in London and the South East. Confidence issues and concerns over potential future interest rate rises are also leaving many property speculators sat on their hands. We would of course want to draw parallels to the fine wine market and in the period reviewed by Lloyds Bank we are looking at data to the end of December 2016 and remember that this period included the three-year slump in the fine wine market between 2014: Asset 12 months to Dec years: years: Property: England & Wales -34% 29% -7% Fine Wine: Liv-ex % 3.8% % Fine Wine: Liv-ex % 18.3% % 29.5% -7.6% % Source: Lloyds Bank, Wine and : Liv-ex In the longer term (ten years ) house sales in all regions were again in negative territory with greater London seeing a decline of -44%, and the North at -42% at the highest levels, East Midlands and Wales the least effected regions at an equal -28%. The report comments on a potential property market north / south divide with 80% of the towns reporting increases in home sales in 2016 located in the north, however this may well be because they offer significant value post the declines endured over the preceding ten year period. In terms of more current data, fine wine continues to perform well and improve on the five-year performance measurement: Asset Fine Wine: Liv-ex 100 Fine Wine: Liv-ex 1000 Source: Liv-ex at 30th June months to 30th June % 27.9% -6.5% 5 years to June % 31.3% -6.5% Low interest rates and schemes such as Help to Buy have engaged first-time buyers; this element of the market showing an increase in activity which represented 49% of house sales financed by mortgages, more than a third up on 2006 and the highest level for more than two decades. But even with this backdrop sales currently remain significantly below levels at the peak of the last housing

Special focus continued Bugatti Chiron at Chateau Impney Hill Climb, July 2017 The Knight Frank Luxury Investment report published in July compared the performance of luxury assets such as classic

Their measure saw fine wine top the league table at 24% growth over one year, 55% growth over 5 years and 256% growth over ten, only beaten by classic cars at 404% in the ten-year period.

net/research/540/documents/en /knight-frank-luxury-investment-index-q1-2017-4749.

You can download this special market report via this link: https://www.vin-x.

5 Special focus continued Bugatti Chiron at Chateau Impney Hill Climb, July 2017 The Knight Frank Luxury Investment report published in July compared the performance of luxury assets such as classic cars, vintage watches, jewellery and fine wine. Their measure saw fine wine top the league table at 24% growth over one year, 55% growth over 5 years and 256% growth over ten, only beaten by classic cars at 404% in the ten-year period. In comparison, property offers nothing like these returns to investors. To read the Knight Frank report in full, see the following link: /knight-frank-luxury-investment-index-q pdf Vin-X s Treasure Asset report, published earlier this year, looked into the performance of luxury investments in more detail, comparing their performance with financial markets. You can download this special market report via this link: With the entry levels for investment-grade wine considerably lower than most other luxury investments, and certainly nothing like acquiring a property, investors can access this rewarding market much more easily and enjoy no capital gains tax applicable on profits made. For more information contact us now on Pick of the month: CHATEAU ANGELUS 2012 The wines of Chateau Angelus have been moving well since its reclassification in The recent 2016 en primeur release continues a trend since that reclassification, whereby Angelus appears to be trying to close the gap in release pricing between itself and the more established St Emilion Grand Cru Classe A wines of Ausone and Cheval Blanc. Angelus is now around 50% of the price of Cheval Blanc, having previously been valued at 25-35% of the price of Cheval Blanc between the 2005 and releases. If this price escalator continues we should expect a significant uplift on back vintage values. The limited edition gold embossed bottling from the 2012 vintage is also particularly attractive to investors and collectors. There is currently a negligible premium for the 2012 Angelus whereas, in the case of the only other wine to employ a similar marketing tactic to which we can make a comparison, Mouton Rothschild 2000, there is a 250% premium to similarly scored back vintages of the First Growth, as the chart below shows. Comparing Angelus bottles to Mouton Rothschild bottles, and their respective regular wines

VIN-X EVENTS: Vin-X sponsors Chateau Impney Hill Climb 2017 Vin-X was proud to sponsor the third Chateau Impney Hill Climb on the 8-9 July 2017.

More than 14,000 spectators enjoyed an unforgettable weekend, where over 200 classic cars competed, with Bugatti, Ferrari, Bentley, Mercedez, Rolls-Royce, Jaguar, Aston, Cobra, Porsche and many more

As you talk to the car owners, their drivers and mechanics the enormous passion for the cars is evident and uniformly they all convey a great sense of pride and privilege to be involved with these

6 VIN-X EVENTS: Vin-X sponsors Chateau Impney Hill Climb 2017 Vin-X was proud to sponsor the third Chateau Impney Hill Climb on the 8-9 July Guy Spollon and his son, Rod, are avid classic car enthusiasts and the architects behind one of the most important UK events in the automobile lover s calendar. More than 14,000 spectators enjoyed an unforgettable weekend, where over 200 classic cars competed, with Bugatti, Ferrari, Bentley, Mercedez, Rolls-Royce, Jaguar, Aston, Cobra, Porsche and many more in attendance. There were also aerial highlights from an RAF spitfire, Lancaster Bomber and the Red Arrows. As you talk to the car owners, their drivers and mechanics the enormous passion for the cars is evident and uniformly they all convey a great sense of pride and privilege to be involved with these great assets. There is recognition of the value involved, a rough estimate by two well-known collectors of the total automobile value on the Chateau Impney estate at the event was about 1bn. The event will be televised on Channel 4 Saturday 5th August at 6.40am and on Motors TV (UK) as per the schedule shown below. You can see more photos of the event at: Château Impney, Worcestershire, UK Motors TV Schedule: Day: Date: Fri 04/08/2017 Fri 04/08/2017 Sat 05/08/2017 Sat 05/08/2017 Sun 06/08/2017 Sun 06/08/2017 Mon 07/08/2017 Mon 07/08/2017 Tues 08/08/2017 Fri 11/08/2017 Time:: 20:00 05:38 09:12 04:11 07:00 01:42 12:11 02:43 22:03 01:42 Classic racers at 2017 Chateau Impney Hill Climb Investment in fine wine is all about performance. I believee in it so much I joined the team in. 1. With annual growth rate of 14% in the last 15 years, you should too. Austin Healey, Leicester, England, British Lion. Proud sponsor of the Financial Plannerner Awards 2017 Vin-X Fine Wine Market Reports: Vin-X regularly produces specialist market reports providing detailed information for fine wine investors. Visit our website for details. LONDON BORDEAUX HORSHAM BURTON-UPON-TRENT info@vin-x.com Tel: Vin-X Limited, Barclays House, 51 Bishopric, Horsham, West Sussex, RH12 1QJ.

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