THOSE whose contact with the great wines is limited, or whose relationship with wine is usually limited to the glass in hand, may be interested in a vinous investment being offered by Rodney Birrell and his partners.

When stock markets seem overbought, interest rates are moribund, and real estate has shot higher than a champagne cork, sober investors could contemplate a five-year plunge into the finest blue-chip, or perhaps that should be red-chip, wines, the Bordeaux Cru Class?.

Mr. Birrell, noted gourmand, and god-son of the late Donald Storey, international investor and legendary captain of the yacht , is an investment manager who has been resident here for 17 years.

About five years ago, unenthused by traditional investment markets, he came across an article which told of a gentleman who had had the foresight to invest in three cases of fine wine, sold two of them after five years to recoup his original investment, and enjoyed consuming the third case for no more than the carrying cost of the investment.

"I have known my partner Andrew della Casa for nearly 20 years, and his friend Peter Lunzer, a true wine expert, joined us in the Wine Investment Project partnership in 2002," said Mr.Birrell.

"I was looking around for ideas on non-traditional investments, at a time when the stock market was faring poorly, and everyone was pretty fed up with it.

"I did some research and discovered that wine, as an investment class, had out-performed every other investment class over a long period, except fine art, which is highly subjective and hard to classify."

According to Mahesh Kumar's "Wine Investment for Portfolio Diversification", fine wines have returned 12.3 per cent on an annualised basis since 1983. Mr. Birrell produced a graph which showed, according to auctioneer Christies and magazine, that a case of 1961 Latour, priced at about ?1,000 in 1984, was priced at about ?9,000 20 years later. A case of 1961 Mouton Rothschild, about the same price in 1984, had risen to just over ?6,000 in 2004. My research showed, not surprisingly, that the performance didn't correlate with the stock market," explained Mr.Birrell, "and I talked to Andrew about the idea when I was next in London, which is the hub of the fine wine market, centred on the Bordeaux wines. He introduced his friend Peter Lunzer, and we had our first investment tranche in 2003.

"Each tranche has a five-year investment period, and we accept investments, at a minimum of ?10,000, from May through August. Of course, we cannot guarantee that performance will match historical results.

"Wine tends to progress in a 'step fashion'; it may plateau for some time, and then move up quite sharply. It's Peter's task to use his skill and experience to judge when it's time to take a position, but we are not gambling on unknowns here. The Bordeaux Cru Class? in which we have invested are world-renowned: Cheval Blanc, Haut Brion, Lafite, Latour, Margaux, Mouton Rothschild, and Petrus."

The partnership raised ?400,000 in their first two years, and hope to raise ?1 million this year. The partners are on the island to meet private investors who are mostly friends of Mr. Birrell.

Peter Lunzer has over 20 years experience in the wine trade, specialising in supplying fine wines to hotels and restaurants before earning a diploma from the Wine and Spirit Education Trust 20 years ago.

"I discussed the whole concept of setting up a wine fund with Rodney and Andrew, and we agreed that what the business needed was a professional investment management concept, which didn't really exist," advised Mr. Lunzer.

"In other words, we created a fund structure which could be investing in orange juice, pork bellies or copper; it just so happens our investment of choice is wine.

"The reason we felt we had to do it this way, is that if you ask any wine merchant for advice, they will always recommend stocks to which they have access. We are completely independent, and are not selling wines into the fund from our cellars!

"Instead of going to the established wine merchants, who are often ready with investment advice, my history in the business allows us to know which wines should be bought to create a return, and from personal knowledge and research, at what prices different wines can or should be bought.

"We are looking for specific wines at a certain price, not just taking the view we have money to spend, so let's just plunge into the market. It's about not owning stock whose price remains on some extended plateau."

Tonight, at a private house on Riddell's Bay, the three partners have invited friends to "join the directors for a glass of wine and a discussion of fine wine investment strategies". They have one obvious advantage over more traditional investments; after all, you can't taste stocks or bonds.