CHICAGO--On a hot, sunny Friday here in September only days after the first Monday market meltdown, two well-heeled wine buyers battled each other at a private auction for the privilege of shattering a world-record price for a single case of 1982 Chateau Lafite Rothschild.

A Chinese buyer who flew in from Beijing for the Hart Davis Hart Co. auction won with a final bid of $54,970 -- a whopping $4,580.83 a bottle. At its release in 1984, a single bottle would have sold for roughly $100.

A case of 1990 Romanee-Conti Domaine de la Romanee-Conti that was released at about $500 a bottle sold for $179,250, or $14,937.50 each. A case of 2000 Chateau Petrus was bought for $57,360, or $4,780 a bottle. At its release, the price was $750 a bottle.

Such dramatic price appreciation is not the norm for wine investments, but it does underscore how lucrative and resilient investing in fine wine can be -- particularly so at a time when market volatility is deflating 401(k) accounts and retirement nest eggs, and low interest rates are choking returns on cash and other investments.

"Historically blue-chip wine prices have risen but at a modest pace compared to some other investments," said Allan Frischman, a senior specialist at Hart Davis Hart. "Over the last couple of years these wines have gone up quite dramatically but it's hard to say how long that will keep up."

It's simple supply and demand that is driving up prices. There are scores of new wine drinkers, mostly in emerging economies such as China and Brazil but also in wine bastions like the U.S. and Europe.

And there are only so many bottles of 1982 Chateau Cheval Blanc or the 1995 Screaming Eagle Cabernet Sauvignon left in the entire world and no more will ever be made. That powers the prices for some cult wines as well as those from certain estates and vintages. Some Napa Valley wines like those from the Harlan Estates are bought and sold as investments, but for serious fine-wine collectors the first-growth wines of Bordeaux and Burgundy are the most important.

Investing in wine is not for the faint of heart or the financially strapped. It's outrageously expensive, takes years -- multiple decades in most cases -- to see the kind of returns the Hart Davis Hart auction produced and, like most investments, can be quite risky. Not every vintage is perfect.

"If you want to be a trader, trade options, equities, corn futures, even coffee if you like that kind of action," said Kevin Swersey, a highly sought-after independent wine consultant. "The world of wine is way too complicated to just jump into."

"Wine is not stock," he said. "It's a consumable, perishable commodity."

Indeed, it is the only true liquid investment and most investors should be prepared to drink it if the values aren't there. Many ambitious wine connoisseurs accidentally become investors because they have to sell old wines to make room for new in their cellars.

Wine can be work

Before jumping into wine as an investment, consider the circumstances surrounding last month's Hart Davis Hart auction. The nearly 1,800 bottles of wine at auction were from the Fox Cellar, what the world of fine wine deems one of the most important and largest single-owner wine collections in existence.

No one but the executives at Hart Davis Hart know who Mr. Fox is -- or even if there is a Mr. Fox -- because they are all sworn to secrecy in confidentiality contracts. But what is known is that he is a long-time collector and avid aficionado who has bought much of his wine through Hart Davis Hart. Even after the sale, there's still plenty of it left.

"For one person to have this much wine is unbelievable," said Paul Hart, chairman of Hart Davis Hart. "He's got all the modern vintages that people want in amazing quantities. Instead of one case of '96 Lafite, there are 22 cases.

"The volume and the depth are remarkable," he added.

The Fox collection is also considered special because the owner has gone to great pains to make it that way. He has a long relationship with Hart Davis Hart, which is one of the leading wine auction houses in the U.S. Rising incidents of fraud in the wine industry gives that relationship a point of distinction because he has done business with a highly reputable concern that can vouch for the wines and how they were stored. That's crucial to investors spending thousands to buy and sell wine.

This too is important information for would-be wine investors: Hart Davis Hart had dated receipts on nearly every case of wine. It also could verify that all of the wines were stored deep underground where temperatures and humidity were closely controlled.

That may be the single most important issue when buying fine wine from any source. Maintaining such a cellar is among the costliest parts of wine investing; simply accumulating wine in your basement is a major faux pas in the world of fine wine.

Fox also was the only owner of the wine, another important characteristic of the collection. Wine can be sold and resold to many owners before it's finally consumed. If it hasn't been properly stored and transported, the quality can suffer.

The Fox collection brought in nearly $11.2 million to become the fourth largest wine auction in history and the largest cellar sold this year. That was well above expectations that ranged from $6.8 million to $10.2 million.

"It was challenging," said Hart, who worried ahead of the auction that the dive in the stock market could keep many bidders away. It didn't.

Alternative means

For those not willing or able to go those lengths to invest in wine, there are a handful of funds open to investors in the U.S. like the Cayman Islands-based Vintage Wine Fund and the U.K.-based Wine Investment Fund, though they are small, carry hefty fees and have high minimum investment requirements.

The newest to the pack is the Elevation Wine Fund, a limited partnership which got off the ground last year but didn't start accepting investors until August at $250,000 each. The fund has about $1.5 million invested in about 1,000 bottles, said Leon Dreimann, a partner in the start up. The fund's Web site says the value of its wine portfolio has risen 27% since June 2007.

Though the Securities and Exchange Commission treat wine funds like hedge funds, Dreimann thinks of Elevation Wine Fund more like private equity. Investors make the financial commitment but don't have to put up the money until the fund finds the right deal.

Dreimann and his partners are putting their money, well, where their mouths are. They put up the seed money to begin accumulating wines and are building a purse to pursue deals.

So far, there are 14 investors and he expects to have about $5 million in the first full year as a fund.

"It's not so much about getting a lot of money in but a steady flow over the next few years of investors that allows us to buy the wines as opposed to sitting on the money," said Dreimann, the retired co-founder of home-appliance maker Salton Inc. who is a long-time wine collector.

"It's difficult for us to find wines with the proper history and at a price that we can see appreciate," he said. Elevation's wines are stored at the Sabina Vineyards in Napa Valley, Calif.

"We're careful of whom we buy wine from and what we buy," he said, recounting an experience in China where he was served a glass of 1982 Lafite Rothschild Latour. "There's a Lafite Rothschild and a Latour, but the two don't go together on the same table," he told those at the dinner. He and his partners make contacts throughout the world from their own extensive business backgrounds.

Elevation investors can draw their dividends in cash or in wine. "If nothing else, I get to drink the proceeds," Dreimann said

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