Most people think of fine wine as an expensive treat - but the managers of an unusual investment fund see it as a way of enhancing wealth.

After the Wine Investment Fund's (WIF) first five-year investment period closed last August, its investors were able to raise their glasses to success, having more than doubled their money.

Although fine wine has taken a knock in value in the economic downturn since then, the fund's founders and directors, Rodney Birrell and Andrew della Casa, believe it is a more recession-proof commodity than most.

WIF buys cases of some of the world's finest wines, all produced in the renowned vineyards of the Bordeaux region in southern France. It stores the wine in a UK government bonded warehouse - which means there is no UK duty or value added tax to pay. Wine does not attract UK capital gains tax either.

After five years, the wine is sold and the proceeds divided among investors. Investors receive regular updates on what their stake is worth and can cash out whenever they please.

The Wine Investment Fund is based in the UK and denominated in UK pounds, but the 20 percent of non-UK clients invest through a mutual fund based in Bermuda.

Mr. Birrell and Mr. Della Casa started the venture in 2003. The fund currently has a net asset value of around £70 million.

"We wanted to double our clients' money," Mr. Birrell, who runs Bermuda-based asset management company Bristol Ltd., said. "We were able to do even better than that. Our first five-year tranche, from August 2003 to August 2008, paid out 108.6 percent, net of all fees."

Two more portfolios, invested from September 2008, have not fared so well - but they have proved more resilient than other investments in brutal circumstances. Having started out just before US investment bank Lehman Brothers failed, sparking a collapse in the world's financial markets, it is not too surprising that both portfolios are down. One has declined 8.6 percent, while the other lost 0.34 percent.

Liv-ex (the London International Vintners Exchange) is a measure of the fine wine market. Mr. Birrell said Liv-ex was down 14.5 percent last year - less than half the fall experienced by the major stock exchanges in either New York or London.

Mr. della Casa, an Oxford University law graduate with more than 25 years' experience in the financial sector, said the fund was launched only after analytical research of a period that stretched back 34 years, a period that straddled good economic times and bad.

What it showed was that the fine wine market was not closely correlated to the fortunes of the stock markets.

They also found that fine wines, of limited supply, increase in price in short bursts over time, rather than in a linear fashion, and gave investors a better return on their risk.

"With more and more wealthy people around the world drinking fine wine, including many people from the emerging markets, prospects for this type of investment are looking stronger than ever," states the fund's website. "There is greater absolute demand from a growing number of consumers who are increasingly spread throughout the world."

But why Bordeaux wines only?

"Bordeaux is a fixed area and it can't be made larger,"

Mr. della Casa said. "There is a limited number of producers who have been making fine wine for hundreds of years. It's a limited supply which becomes more limited as the wine is consumed."

Investments for the next tranche will close on April 30.

"We feel it's a good time to invest right now, because we definitely saw a softening in prices in the last quarter of 2008," Mr. della Casa said. "We saw a bottom two months ago. Wealthy people continue to drink fine wine and when wine prices rise, they tend to rise quickly."

There is a five percent subscription fee for investors, plus a 1.5 percent per annum management fee and a performance fee at maturity of 20 percent of returns.

The fund's investment managers, William Grey and Chris Smith, have decades of experience of the wine market between them, and they seek wines that are at least four years old and which have established a reputation as a good vintage.

For more information on the Wine Investment Fund, see the website www.wineinvestmentfund.com