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Date Published: 18/11/2020
Online Published: 17/11/2020
Abstract Views: 509
Views PDF: 275
DOI: https://doi.org/10.38203/jiem.020.3.0013
Issue
Vol. 20 No. 3 (2020)
Section
Articles
How to Cite
Ackerman, R. . ., & Truong, X. D. (2020). Wine and music: diversification with investments of passion . Journal of International Economics and Management, 20(3), 1-16. https://doi.org/10.38203/jiem.020.3.0013

Wine and music: diversification with investments of passion

Ross Ackerman 1, Truong Xuan Duong1,
1 Ivy College of Business, Iowa State University, Ames, USA

Main Article Content

Abstract

Investors buy “investments of passion” – like classic cars, stamp collections, and art – for personal interest ahead of any financial benefits. This research aims to study the convergence of the two by examining fine wine and music as alternative asset classes. Analysis of each asset includes a history of price performance over the sample period, the asset's correlation with equity markets, the allocation between the asset and the S&P 500 according to an efficient portfolio frontier, and a maximum Sharpe ratio analysis. While acknowledging caveats such as the storage cost of wine, a short sample period, and market illiquidity, this study shows alternative assets such as wine and music can improve investors’ portfolios and provide financial benefits beyond personal passion. 

Article Details

Keywords

Wine investment, Music investment, Alternative assets

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