1. Trading

2. Data

3. Settlement

4. Liv-ex Products
    LWIN  Wine Matcher  DMA  Insights 

5. Liv-ex Indices
    Liv-ex Fine Wine 50 Index  Liv-ex Fine Wine 100 Index  Liv-ex Bordeaux 500 Index  Liv-ex Fine Wine 1000 Index  Liv-ex California 50 Index  Liv-ex Port 50 Index 

6. Bordeaux classification

7. References

8. External links

Liv-ex was founded in 2000 by two stockbrokers, James Miles and Justin Gibbs. It started with a group of 10 founding members in London, and a vision to make fine wine trading more transparent, efficient and safe “because their opposites—opacity, inefficiency and risk—are the three things that stop people from dealing with each other.”^[2] Since then, membership has grown to over 400 merchants from 36 countries worldwide, and Liv-ex represents the largest pool of professional fine wine buyers and sellers globally. It is also the world's most comprehensive database of fine wine prices.

Trading

Liv-ex's global network enables members to trade safely and efficiently with other merchants worldwide. Trading on Liv-ex is reserved for professional buyers and sellers of fine wine, and is standardised and anonymous. The total value of bids and offers on Liv-ex surpasses £50million.^[3]

Data

Liv-ex data is based on the activity of over 400 fine wine merchants based in 36 countries worldwide.^[4] Their activity accounts for an estimated 95% of fine wine turnover globally. Trades, price updates, bids and offers are standardised, verified and published as tens of millions of historic lines, with thousands of daily updates of reliable, independent and trusted data.

The data is based on real merchant transactions, rather than advertised prices which can be inaccurate and out of date. Liv-ex data is regularly quoted by media outlets including Reuters and Bloomberg.

Settlement

With operations across the UK, Europe and Asia, Liv-ex provides it members with settlement and transport services. All services are charged at a flat per unit rate (with no minimum quantity) and are coordinated by their logistics team. All wine traded on the market passes through the Liv-ex warehouse in London. The warehouse is temperature controlled and highly secure. Wine stored in the warehouse can be traded on Liv-ex, without the need to be moved or checked again. Transfer of ownership can be instant.

Liv-ex Products

Liv-ex has a number of online products which help members make the most of the platform.

LWIN

LWIN (Liv-ex Wine Identification Number) is the universal wine identifier. Liv-ex created it in 2011 to provide a standardised numbering system that is designed to avoid error in communication, transfer and referencing. It removes the need to rely on written descriptions and provides the key to establishing which item in one database corresponds to which item in another database, which is helpful in transactions between organisations.

The unique seven-digit numerical code is designed to quickly and accurately identify an individual fine wine product. It enables messaging between systems and over the internet, allowing the trade to share information more easily.

Each LWIN refers to the wine itself i.e. the producer, brand or vineyard. The first six numbers of the code represent each wine's unique identifier, while the seventh number is a “check digit” that minimises input errors. Additional information including the vintage, pack and bottle size can be appended to the LWIN in a standard format.

The LWIN standards for including additional data are:

• LWIN: 1234567 – Example winery, Cabernet
• LWIN-11: 12345672012 – Example Winery, Cabenet, 2012
• LWIN-16: 1234567201200750 – Example Winery, Cabernet, 2012, 750ml bottle size
• LWIN-18: 123456720121200750 – Example Winery, Cabernet, 2012, 12 bottles of 750ml

For Liv-ex, LWINs are a foundation for the fine wine Exchange, from managing and sharing price data to maintaining the efficiency of their settlement and distribution services.

Wine Matcher

Wine Matcher is a web-based, artificial intelligence tool that allows merchants to take lists and transform them into a standardised set of wine names and formats with unique IDs (LWINs).^[5] These IDs can easily be shared with other systems or entered into a database for comparison in a matter of minutes. It can also return the clean list with wine price data – such as Market Price or last trade – from Liv-ex.

Wine matcher automates the labour-intensive and manual process of valuing lists of wine and preparing packing lists. It can match up to 5,000 lines of data per minute. The tool is powered by Amazon web services and harnesses the power of the cloud to make it available to users on the Internet.

In 2017, Wine Matcher was awarded ‘Supply Chain Initiative of the Year’ by The Drinks Business.^[6] The judges called it a “very clever innovation” that “has far-reaching and practical implications for the fine wine trade”.^[7]

DMA

DMA is Direct Market Access. It automates buying and selling on Liv-ex, designed to help members grow their sales.^[8]

Direct Market Access allows merchants to offer millions of pounds worth of high quality stock to their clients. This includes some of the rarest wines in the world. Unlike long broking lists, all of the wines displayed have guaranteed availability and a specified delivery window. When a customer purchases the wine, via their merchant's website, it is committed to them immediately and their merchant can be paid right away. With more and more members offering Liv-ex listings direct to their customers, there is a growing number of buyers looking at the market every day.

DMA enables merchants to keep their stock list in sync with Liv-ex. Their wines are offered on the exchange until they are marked as sold on their stock management system.

Insights

Liv-ex provides its members with market analysis, including in-depth reports and market updates.^[9] They cover new releases in their News and Insights section, as well as weekly trade, and interviews with important figures in the wine industry.

Liv-ex also publishes annual coverage on the Bordeaux En Primeur campaign, as well as Power 100 – their list of the most powerful brands in the fine wine market in conjunction with The Drinks Business.

Liv-ex Indices

Liv-ex produces a number of fine wine indices that track prices for given groups of wines.^[10]

Liv-ex Fine Wine 50 Index

The Liv-ex Fine Wine 50 Index tracks the daily price movement of the most heavily traded commodities in the fine wine market – the Bordeaux First Growths. It includes only the ten most recent vintages (excluding En Primeur), with no other qualifying criteria applied.

Liv-ex Fine Wine 100 Index

The Liv-ex Fine Wine 100 Index, which is available on Bloomberg and Thomson Reuters, is considered the industry benchmark. It represents the price movement of 100 of the most sought-after fine wines on the secondary market.

Liv-ex Bordeaux 500 Index

The Liv-ex Bordeaux 500 is Liv-ex's most comprehensive index for Bordeaux wines. It represents the price movement of 500 leading wines from the region and is calculated monthly using the Liv-ex Mid Price. It has been backdated to December 2003.

The index comprises six sub-indices: the Fine Wine 50, the Right Bank 50, the Second Wine 50, the Sauternes 50, the Right Bank 100 and the Left Bank 200.

Liv-ex Fine Wine 1000 Index

The Liv-ex Fine Wine 1000 tracks 1,000 wines from across the world using the Liv-ex Mid Price. It is calculated monthly and was rebased at 100 in December 2003. It comprises seven sub-indices: the Bordeaux 500, the Bordeaux Legends 50, the Burgundy 150, the Champagne 50, the Rhone 100, the Italy 100 and the Rest of the World 50.

Liv-ex California 50 Index

Liv-ex recently launched the California 50 index, which tracks the performance of the last ten physical vintages of Screaming Eagle, Opus One, Dominus, Harlan Estate and Ridge Monte Bello.

Liv-ex Port 50 Index

In 2018, Liv-ex also created the Port 50 index, which tracks the price movements of the last ten vintages of the five most actively traded Port wines: Dow, Fonseca, Graham, Taylor and Warre.

Bordeaux classification

In 2009, Liv-ex updated the Bordeaux Wine Official Classification of 1855, emulating the original method while using modern price averages from the last five vintages (2003–2007). The list was assembled applying Médoc and Pessac-Leognan wines with a minimum production of 2000 cases, disregarding any second wines that would qualify.^[11]

References

External links

• Liv-ex official site
• Liv-ex Blog
• Cellar Watch
• [https://www.forbes.com/2009/07/13/livex-wines-futures-markets-equity-entrepreneur.html Forbes: Wine Futures]

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