As the wine investment business leader with $275M of assets under management, Cult Wines has been a pioneer in the space for over a decade.  Born out of a passion for wine, Tom Gearing, CEO and founder of Cult Wines, tries to balance the head and heart elements of investing in wine with actively managed portfolios by CFAs and experiences with some of the top wineries of the world.  Tom shares all the details and great examples of why people should consider investing in wine, the Cult Wine investment process, and where Cult Wines is heading.  Detailed Show Notes: Tom’s backgroundfounded Cult Wines w/ his brother in universityFather was an investment banker with a passion for wine, especially BurgundyTraveled a lot to Burgundy as a childStarted an import company - Burgundy CellarThe early 2000s - started Financial Wines - an online price transparency tool, but ran out of funding after the dot com crash2007-2008 - during Financial Crisis - people looking for alternative investments - Tom realized wine was a safe haven and should be more investableBased in the UKWhere the Wine trading is very well establishedThe UK has tax free status for wine trading for anyone in the world - can keep wine in a tax free warehouse where you don’t pay taxes (sales tax, VAT) upfrontAsian collectors used London to build collections before shipping itBrexit impact - mostly operational (shipping is a lot slower) vs. tax,Why invest in wine?Those with a passion for wine - Build a fine wine collection, can drink it, or sell it in the futureThose not passionate about wine - wine prices are more consistent and tend to go up in value because the supply goes down over time (people drink it), tends to be insensitive to financial market fluctuations (went up in value in 2009) - suitable for diversificationVs. art/cars/other alternative investments, wine is more attractive:Accessibility - lower barriers to entry - hundreds or thousands of dollars for wine vs. millions for fine art/carsLiquidity - better than other alternative assetsPrice transparency - more trading publicly and more visibility (though, still not as good as it could be)Wine investment serves as a storage/aging function for the fine wine market with pristine provenance and authenticityCult Wines OverviewNot a retailer - acquires wines on behalf of clientsThree warehouses - London, Paris, BordeauxEU changed storage laws in 2016 to hold wines without paying VAT (similar to the UK)Have own warehouse and staff to ensure provenance and authenticity of wines (e.g., caught heat damage on a shipment of Scarecrow wine and made a claim with freight forwarder immediately)Has own photography studio and processes 250 cases/day, and photos are immediately uploaded for inspectionInvestment processHas a managed portfolio service (min $10k investment)Gather client objectives - risk profile, investment duration (3-5 years, 5-10 years, 10+ years), how wine fits into their entire portfolioBuild a personalized, customized portfolioStore wine in physical warehouses (clients own bottles or cases, the physical asset b/c it’s hard to have liquidity for funds where people have fractional ownership of a fund)Get access to investment platformTop-down investment process - actively managed portfoliosCult Wines has a Chief Investment Officer (CIO), and all portfolio managers are Chartered Financial Analysts (CFA)Constantly reviewing the market and making asset allocation decisionsE.g., Trump Tariffs on European wine - team thought Bordeaux would go down in price, proposed reducing allocations from 40% -> 30% and re-allocate to Italy, which looked undervalued already and had no tariffs; in 6 months, AUM of Bordeaux went from 40%->36% and Italy 6%->13% and Bordeaux prices went down 2-3% and Italy up 12%Assets Under Management (AUM) - $275MUK/Europe is the biggestAsia nextAmericas (smallest, but newest)FeesAnnual management fee - starts at 2.95%/year (with $10k investment), 2.75% (with $35k investment), 2.5% ($150k investment), 2.