Primarily collectors are looking to secure rare bottles, or collections but the newest trend is to purchase entire casks with emphasis on both well-known distilleries with brands and distilleries with a unique history.
Cask investment gives investors more options. They can bottle their own product, meaning more stable returns – there is more relative stability in terms of price and steady increasing intrinsic value over the years through ageing. When it stays at the cask, the quality of the liquid increases every single year as opposed to once it is bottled (Bottle prices solely rely on the popularity of these particular bottles).
Experts insist that the right collectable whiskies could be a better long-term bet than gold, wine, classic cars, or other alternatives and as the market expands globally is rapidly becoming the ‘must have’ asset amongst savvy investors.
A Luxury Investment
Rare whisky has topped the Knight Frank Luxury Investment Index as the asset with the biggest potential return, having achieved 40% value growth in the past year and a 582% increase since 2009 – the highest of any investment.
The most significant sale of 2018 was a bottle of Macallan 1926, hand painted by Irish artist Michael Dillon, that sold for a record-breaking 1.2 million in November.
Whisky was followed by coins (12% annual growth) and wine, which was the third most investible asset have increased in value by 9% over the past 12 months and 147% over the past 10 years.
The stunning price growth of rare single malt whiskies shows that the appetite for new “alternative” asset classes remains strong among high-net-worth investors. The key to rare whiskies sustained growth as an asset class, is the passion buyers worldwide share for investing, collecting, and occasionally drinking, some of the best and rarest Scotch whisky ever made.
– Andrew Shirley, editor of the wealth report and the Knight Frank Luxury Investment Index.
Source: Knight Frank 2019
Whisky Market Forecast
The fundamental upon which this growth is based is a perfectly inverse supply vs. demand imbalance: the Scotch whisky industry at maximum capacity can produce approximately 35 million liters of single malt annually, while consumer levels globally sit at an astounding 500 million for whisky as a whole.