Whisky, like wine, has seen incredible progress over the years in terms of appreciation and innovation. But one way in which it has really showed promise in is the investment scene, a fact that Charles Maclean — who’s had more than two decades worth of research and writing about whisky under his belt — can attest to.
When it comes to purchasing alcohol as an investment, fine wine is probably at the top of the list, especially since two bottles of Romanée-Conti 1945 just smashed records to sell for US$1.05 million (S$1.43 million) at Sotheby’s latest auction. The market for whisky, however, has seen such a notable increase that investing in the precious liquor might just be the new way to go now.
If you’re a beginner, dipping your toes into the world of whisky investments can be a very intimidating affair. Here, Maclean shares with us his thoughts on the matter, so start taking notes.
On why Scotch is such a viable investment prospect
“When stock markets crashed in 2008 and 2009, investors began seeking ‘alternative investments’ to traditional equities, such as vintage motor cars, fine art, stamps, coins and wine. Currently, whisky — especially Scotch and Japanese variants — is rated the third most attractive investment, out-performing gold and wine.
There has been a steady increase year on year for the past 10 years. For the first time last year, 100,000 bottles sold at auction, an increase of 29 percent (by volume) and 68 percent (by value) compared to 2017.
Rare Whisky 101’s leading index for rare whisky at auction — the Apex 1000 Index — which tracks the best-performing 1,000 bottles of rare whisky, closed the year up 30.01 percent, once again outperforming the Liv-Ex Fine Wine 1000 (10.00%), FTSE 100 (-12.48%), Brent Crude (-19.50%) and Gold (-2.14%).
In their most recent report, Rare Whisky 101 noted an increasing demand for old whiskies in cask, and an increase in funds dedicated to purchasing the same, most notably in China, Hong Kong, Scandinavia and the USA. However it is very difficult to purchase good quality, mature age Scotch whisky casks, and only a few Scotch whisky makers – including Diageo’s ‘Casks of Distinction’ programme – are making such old casks available for private sale, and only then to a limited number of VIP clients.
On making comparisons to other types of alcohol in the market
“The only other alcohol which is currently perceived as a sound alternative investment is fine wine. However, unlike whisky, most wines peak and then decline in flavour. Also, wine must be carefully cellared to retain its profile. The whisky industry maintains that there is no change in flavour in a sealed bottle, although many collectors disagree with this, maintaining improvement rather than deterioration.”
On the most important things to take note of
1) Buy what you can afford
2) Old age is not a guarantee of quality, although it is a useful indicator
3) Buy what you like to drink
4) Buy limited editions and special bottlings
5) Watch out for fakes
On favoured distilleries
“Macallan leads the way in both value and volume (a single bottle of 60-year-old Macallan achieved just over £1 million at auction in New York in November 2018). Other sought-after brands are Dalmore, Bowmore, Rosebank, Port Ellen, Brora, Highland Park, Ardbeg, Springbank, Bruichladdich, and Laphroaig. Japanese whiskies include Karuizawa and Hanyu.”
On selling your whisky after
“As well as selling through traditional auction houses (Bonhams is the best known one) there are now dozens of reputable online auctions, many of them run by specialist retailers in parallel with their daily business.“