People have said it before, and it needs to be said again. Investing in - or gambling on - wine can make you money. It can be for quick turnover or for long-term investment but, if you're on the ball, there are big bucks to be made. So it's about time someone explained how to do it.

Depending on where you get your information, the world fine wine market is worth billion a year.

In the US, Sotheby's did million (£12m) in wine at auction in 2002; a UK company did £10 million in six weeks during the latest Bordeaux Futures 2003 campaign; and a major European bank is opening a €40 million investment fund in wine.

There is significant interest in top wine labels around the world. Here are some that have made fortunes over the years - some reds and whites to whet your appetite.

For starters
A case of Ch�teau Latour 1996 sold at £360 a case on release, and happily trades at £1,800 today. Le Pin 1998, a legendary vintage for Pomerol, sells at £8,000, almost 500% up on its release price. Italians are great sellers, too: a case of Solaia or Masseto from 1997 costs £1,800, up almost 400% on their release price. And if you happened to get your hands on a case of Petrus 1982 at its release (around £600) your kids can now flog it for 10 grand! So there are huge gains to be made (by you in your dotage, or by your offspring) from buying wisely - and being patient.

Much of the skill is in finding the wines and the volumes at the right price in the first place. Trading bottles of wine is not like trading shares on the Stock Exchange - you can't simply call your broker and do the transaction. You have to take the time to find a seller or buyer for the wines on which you want to gamble. On top of that - and it's a good thing too - people drink the stuff, even if a bottle of Roman�e Conti 1990 costs more than £5,000 in a restaurant. As a result, particular wines become increasingly rare. You can't simply raise the production because the punters want more; there is a limited supply. And as a particular vintage's rarity increases, so does value.

To make the most of this gambling wine adventure, there are two major routes: you can DIY, or do it through professionals.

If you do it yourself, you need to be really on the ball and have contacts in the wine industry, because the market can change very quickly. If a top critic gives a perfect score to particular bottle, its price can double in a day and quadruple in a week. So if you like his opinions but don't read what he said until the weekend, the chances are that you've already missed out on the early, snappy profits.

Professional wine investment companies, such as Wine Portfolio Management, based in France. They follow the market on a day-to-day basis and know what is about to happen thereby making sure their customers get the best deals. Generally they'll charge you around 15 to 20%, which isn't much compared with your potential gains. On top of that, they believe they know where to get the wines at the right prices - and where to sell them.

At the back of the garage
For instance, you may have been interested in Masseto 1997 (the wine of the vintage in Italy) or Le Pin 1998 (one of the greatest vintages ever for this garage, or tiny production, wine) or Cheval Blanc 2000, the wine of the greatest vintage ever in Bordeaux.

So what happens? Masseto 1997 opened at £35 and as soon as the respected American journal Wine Spectator gave it the thumbs-up and sent it rocketing to the top of the charts, the wine was selling a matter of days later at three times that price in the UK. WS gave Le Pin 1998 similar scoring and thus this already hard-to-find wine became liquid gold. Cheval Blanc 2000, an extraordinary St Emilion, was named a no-brainer wine of the vintage by top critic Robert Parker and the price went mad.

Playing the market is also important. Masseto 1997, while selling at £150 in the UK, was being snapped up by US buyers at £220. Le Pin, Valandraud (another garage wine) sells for much more in Asia or the US than in Europe, as do the cult Burgundy producers. So buying it here and selling it over there can seriously affect the value of your wine portfolio.

Be critical
Subscribe to the critics. These few people make the difference between a good investment and a bad one. They can make or break a wine, a wine maker, a vintage. Make sure you have the Wine Advocate from Robert Parker, the Wine Spectator and Clive Coates (for Burgundy). They are influential even more so than Blair.

Decide on your buying strategy and how much you want to gamble or invest. Like any form of gambling you have to be ruthless. Wine has an almost romantic aura about it, especially for the great names. An Imperial (six-litre bottle) of Ch�teau Margaux 2000 in your cellar may lead you to become somewhat attached to it. However you must remember that, bought as a future in 2001 at £2,000, it will certainly be worth double that by 2007. You must also decide whether you're after quick profits or in for long-term, regular saving. In our experience, wine generally produces far higher returns than any other form of investment, so we reckon it's worth consideration as part of your financial scheme.

Generally, to make decent gains you should think of investing at least £5,000 - but the sky's the limit. Some of the greatest collectors have cellars worth millions of pounds. However, the biggest gains tend to be made in trading rather than stockpiling. Wines change with every vintage, and newcomers arrive on the market every month. To make the most out of the new releases, the canny trader will invest or gamble regularly.

Put a cork in it
To ensure you're making educated decisions, however, professional advice is essential. Specialist dealers have access to the best quality, largest quantity and most competitive prices of stock. There are a number of wholesalers in the UK). But you should always compare prices, as they vary depending on the vendor - some source their stock from cheaper, Continental wholesalers.

In order to spread the risks, a commonly practised strategy is to buy older vintages, the values of which are less volatile. They show established form, and the prices have a history. While their worth doesn't fluctuate as much as that of less well established products, you have some safeguard against their losing value. After all, as that particular vintage grows scarcer through the odd bottle being consumed, the remaining stock appreciates in value.

For the risk taker, however, there are big gains (and losses) to be made in futures - buying and selling on the expected value of vintages yet to be bottled. Their price is much more volatile, so the opportunity to make quick cash is there - as is the chance of ending up with negative equity if you bought at the wrong time.

But how about tax? Specialist management firms store wines in bonded warehouses in which they are, in effect, 'on hold' - no VAT is payable until the wines leave the warehouse. If you're gambling on wine, it's a handy way of minimising your capital outlay, leaving you with more cash to invest until the profits start rolling in.

Auction stations
One of the most popular ways to trade wine is through international auction houses, such as Christie's or Sotheby's, which hold sales every few days.

Should you take this route, the goods have to be inspected before the sale, so you will be asked to deliver your wines six weeks in advance of the hammer falling. Payment comes through four weeks after the auction, out of which comes the auctioneer's commission and any other costs.

Generally, the pre-sale estimates are cautious but, as with any auction, you have the option of a reserve price to guard your investment.

A number of online auctions also specialise in wines, but if you prefer not to take that route at all, the wholesalers can do the work for you. They will give their own clients first refusal and take a cut of 10-15%. Many warehouse specialists hold their clients' stock in bond, so by simply switching owners, the vintages don't leave the warehouse.

There are other advantages to consider, as well. In the UK, wine - but not port - is categorised as a food product and therefore its value depreciates. So your occasional buying and selling incurs no capital gains tax. That's the theory - but your financial adviser will be able to put you straight.

It's also worth bearing in mind that it may take time to sell stock at the right price. As with any market, there are fluctuations, good and bad, which should be taken into account when managing a wine portfolio. You should also check your portfolio manager's credentials and insurance, as well as their transport methods, before entrusting them with your cellar. You should make sure your bottles will be replaced, rather than have to accept financial compensation, should anything go wrong.

The canny gambler can make money by investing wisely in wine. The top labels have shown remarkable stability over the last 15 years. In our opinion, if you buy the right vintages you can generally expect to double your investment in two years. But the key to success is knowing which bottles will make the highest returns - so do plenty of research first.

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