The Knight Frank Luxury Investment Index tracks the price growth of 10 luxury investment sectors.

Investors poured more funds into wine than any other alternative investment over the 12 months up to the end of Q2 2017, according to the Knight Frank Luxury Investment Index.

The index, which includes alternative investment assets such as cars, art and wine, rose 5 per cent over the same period. The index outperformed gold and high-end London residential property over the same period, Knight Frank said in a statement.

It is a time of change at the top of KFLII, which tracks the price growth of 10 luxury investment sectors. Wine, which was up 25 per cent, topped the charts, and Knight Frank said this was due to strong growth in the key Bordeaux, Burgundy and northern Italian markets. No other asset class achieved double-digit growth across the period.

Classic cars, which have dominated the rankings for the past few years, dropped down to sixth place with average prices rising by just 2 per cent from Q2 2016 to Q2 2017. 

Jewellery rose 4 per cent over the last 12 months. Overall, jewellery has risen in value by 142 per cent over the past 10 years.  Pearls are still the top performer, seeing an increase of 282 per cent across the last decade.

It has also been a good year for coloured gems, with the world record being set for price per carat for a green gem when the 18.04-carat Rockefeller emerald sold for $5.5million at auction. Blue stones continue to set the price growth benchmark for diamonds, rising by 5.5 per cent over the past 12 months, compared with a slight drop in the value of pink diamonds, according to data from the Fancy Color Research Foundation (FCRF).

“It has been an interesting year so far in the world of luxury investments, but one that is difficult to generalise about,” said Andrew Shirley, KLFII compiler. “While the most highly coveted objects of desire have performed strongly at auction, buyers remain circumspect when purchasing new assets for their collections. In terms of classic cars, for example, we have recently seen the most expensive Aston Martin ($22.5m) and Mclaren F1 ($15.6m) go under the hammer, but other auction sales with less stellar cars have disappointed.”

Shirley added: “Jewellery continues to capture the imagination of wealthy collectors and is a genuine investment of passion – offering not only great pleasure to its owner, but also acting as a highly mobile store of wealth.”