Rare whisky has outperformed other investments such as wine and gold, enjoying a record year in 2015.
The leading index for scotch whisky, the Rare Whisky Apex 1000, rose by 14% last year, outperforming wine, which fell by 0.4%, gold, which declined by 10%, and many of the world’s leading equity indices. The FTSE 100 index in London lost 4.9% in 2015, while on Wall Street, the S&P 500 edged up 0.7%. In China, the Shanghai Composite gained 9.4%.
The whisky market is booming: the total value of rare whiskies sold at auction in the UK last year was £9.6m, up from £7.6m in 2014, according to consultancy Rare Whisky 101. (Read more)
One golden rule to remember: scarcity makes the value – but here are some tips to help you look into the right direction:
- Bottles from closed distilleries, also known as « silent distilleries » (which have ceased production) are particularly favoured by investors. Amongst those: Littlemill, Brora, Rosebank, Port Ellen or Hanyu when it comes to Japanese whisky.
- Of course, like for all kinds of investment, it’s important to remember that trends are always evolving and whisky investment doesn’t come without risk (which is what makes it thrilling for some…). Still, in order to minimize this risk, I would advise you to prefer official distillery bottlings (which often offer better gains when sold than independent bottling from a similar nectar – same distillery, same age, same distillation/bottling year…)
- Look into limited releases – for instance, during the annual Feis Ile whisky festival on Islay (Scotland), some distilleries (like the world-famous Ardbeg & Laphroaig) are launching special editions in small quantities – often sold out in a few days…
- When it comes to popular investment-friendly brands, a handful of historical distilleries keep standing at the top ranks of auction houses : Macallan, Ardbeg, Dalmore, Bowmore, Highland Park (pssst, look at this new baby!), The Balvenie or Glenmorangie…
Although increasingly popular since a few years already, aged Japanese whisky is currently undergoing what many industry members refer to as a “shortage” – due to a high demand Japanese producers did not fully anticipate decades ago. And this drougth may last for a little while… For instance, we may have to wait quite a few years before seeing a Yamazaki 18 years old hit the shelves again!
Bourbon is also getting more and more popular amongst investors – you must have heard about the Pappy Van Winkle craze, breaking record prices at auctions…
It’s also time to look into the« world whisky » category: some liquid gems could offer investors interesting profits in a few years… It’s already the case with the Taiwanese Kavalan, the Canadian Crown Royal or the Indian Amrut to name but a few. My advice here? Widen your liquid horizons!
- The overall state of the bottle: are front and back labels readable, torn, ripped or damaged in any way (may happen for vintage whiskies which haven’t been stocked in the best conditions)?
- The filling level (or filling line). Evaporation is normal with time but it’s still necessary to make sure the filling level isn’t abnormally low.
- Make sure the bottle is sealed and unopened. An open bottle drastically decreases in value.
- Read carefully all the information on the labels and bottle: distillation/bottling dates, content, ABV, cask types, number of batch, bottle, barrel… The more information the better.
- Always do some research before buying and do not hesitate to ask advices to your fellow whisky enthusiast friends to avoid buying fakes.
Two main solutions:
Find out what your favourite local distributor has in offer – if you’re not familiar with any specialised shop, always make sure the seller is well-established, recognised and trustworthy (check reviews on the internet, many forums could be helpful to ask for tips such as Whisky Magazine’s).
I do believe auction houses are still the best way to find great deals as buyers and make the best gains as sellers. My go-to choice would be Catawiki.com which allocate a dedicated marketing budget to its auctions every week (meaning greater worldwide exposure) and offer 3 weekly auctions of both regular and more exclusive whiskies. A real goldmine for investors. (I see you coming “Pssst, you’re an auctioneer you’re not being objective here” –> Just keep in mind that I agreed to join the platform because I strongly believe in its performance and service for whisky enthusiasts – so far, I haven’t been proved wrong as the whisky auctions keep increasing in volume and value! \o/ – And seriously… getting to check and auction all those whisky wonders is more than thrilling… Yes, I’m one of those persons who get excited at the sight of an old Littlemill or Bruichladdich Micro Provenance… Neurosis? Maybe.)