Whisky for Investment 2019, All You Need to Know

Whisky for investment 2019

When thinking of luxury investment items, whisky doesn’t typically come to mind first, but the whisky market has seen significant and consistent growth in recent years. The market has grown by 732% since 2013 and is expected to continue growing. Additionally, the value of Scotch sold at auction in 2018 was £40,772,550, marking a 62% increase on the year before as more and more investors and collectors compete for top-quality drams of Scotland’s water of life.

Most expensive bottles

The number of bottles sold for over £10,000 has also seen a 1295% increase since 2014, with over 200 bottles traded last year. 2018 saw the record broken for most expensive bottle under the hammer, with a Macallan 1926 60-year-old hand-painted bottle going for £1,000,000. Of the five most expensive bottles sold last year, four come from the Macallan distillery, making it the clear stand-out in quality whisky investment. This is mostly thanks to careful marketing, extensive aging periods, rarity and strictly maintained quality.

Investor Ratings

Since Rare Whisky 101 began their investor reports in 2013, Macallan has dominated the investor ranking year on year, until the distillery saw a dip in sales at the end of last year which brought it to its lowest point on the list at number 4.

Investor report top 5 2018:

Bowmore
Brora
Springbank
Macallan
Glenugie

Alternative markets

Scotch isn’t the only market making significant gains, however, as markets in the US, Japan and Canada push themselves onto the investment scene, each bringing their own particular qualities to the world of whisky. Japan, in particular, is drawing the eyes of investors, thanks in part to a growing middle class in Asia. The highest price collected for a bottle of Japanese whisky was £120,000 for a Yamazaki 50-year-old. While nowhere near the colossal heights of the Macallan 1926, this shows that Japan should be taken seriously as a contender in collectable quality whisky.

Best distilleries for beginners

But, while the number of super expensive bottles sold is steadily rising, the diversity in distilleries and age expressions means that Scotch investment is still highly accessible for would-be investors. While many looking to enter the world of whisky investment may not have the money to start their collection with a bottle worth £10,000, there are still huge numbers of distilleries across Scotland which make premium whisky that investors and collectors alike are willing to snatch up.

Some distilleries to focus on at a lower price point include:

Glendronach
Benriach
Benromach
Glenallachie
Tamdhu
Tomatin
Ben Nevis

The history and culture of these distilleries, as well as their varying flavor profiles, mean they remain highly desirable but start at a much lower price, helping hopeful investors build up their collections and make more gradual and consistent gains.

Getting started

To start a whisky investment portfolio, there are a few things any wannabe investor will need to keep in mind. There are so many whiskies available and so many things to take into account.

While understanding the market can be difficult at first, following these simple steps will be a great introduction to the strategy behind making money from your whisky collection.

Love whisky

While it’s not exactly a requirement, having a personal love of whisky makes collecting and investing in it much more exciting. Those who already love the drink are likely to understand more about the industry and make more informed decisions based on what they like and what they know is available.

Make a plan

Understanding what you want to get from your investment is a useful way to start which will keep you on track and reduce the risk of financial loss. While whisky is on a fairly consistent upward trend, having a plan for the future can also protect you if the market behaves unexpectedly.

Know the market

Whisky is one of the broadest categories of drink because of the different flavours, regions and aging methods. Knowing what investors and collectors typically go for will inform your decisions and allow you to keep a healthy portfolio. Limited release whiskies are also some of the most attractive for investment, so keeping an eye on upcoming releases can result in major gains fairly quickly.

Cask vs bottle

Although bottled whisky is the most invested-in category, investing in whisky casks has a number of unique benefits. Barrelled whisky has also never returned less than 60% if held for at least six years, making it a more stable investment than crude oil, gold and the FTSE 100.

Take your time

Conclusion

Investment is all about timing and, while the value of whisky may be the highest we’ve seen, waiting longer for the right time to part with your best bottles could result in even bigger gains. This is where an understanding of the market will really come in handy for any investor.

The stable gains whisky has been making over the past few years mean this is truly the best time to get into whisky investment. With such a vast range of products to pick from, investors of all kinds can find something that catches their eye at any price range. Should the market continue at its current rate, making gains on your personal collection is almost guaranteed for any savvy investor.

This article, Whisky for investment 2019, was written by Damon Culbert from The Spirits Embassy, rare whisky and spirits marketplace with shipping worldwide.

…