With the UK’s appetite for Whisky growing there has been a notable collectable increase in old and rare whisky. Whisky has become the most popular product to buy when people visit Scotland. According to the Independent there has been a significant increase in whisky bars and hotels looking to invest in collectable whisky bottles to offer their clients. So why should you invest in old and rare whisky?
Know your market
Contrary to what most believe only one qquarter of Scotch whisky distilleries are owned by Scottish companies. Most of the whisky’s you drink are owned by much larger parent companies such as Pernod Ricard and Diageo. Like any investment it’s imperative to know your market, inflations and price changes. The demand for whisky in Asia has dramatically increased over the past 10 years with auctions in China providing the highest selling single malts. By knowing the popular markets for whisky auctions it allows you to focus on these locations.
How to Invest in Old and Rare Whisky
There are three ways for your invest in old and rare whisky bottles.
Buy to Auction – The first option is generally the most common amongst whisky collectors. Buying rare bottles to be later sold at auction. There has been a high increase of whisky auction websites and physical auctions due to the high demand for collecting whisky. So it is easy to find a site to auction your collectable.
Directly Invest – For a more direct approach, investing in the distillers directly would take form in buying stocks or shares in companies such as Pernod Ricard or Diageo. If you’d rather take a more independent approach there is also buying a cask directly to own, which is a slightly more expensive option.
Own Maturing Whisky – This is a new option for our whisky collectors where unlike the tradition methods of investment, it allows the collector to purchase individual Litres of Pure Alcohol (LPA) where they can then preserve it in the bonded warehouse at the general rate.
Factors to Consider?
It is important to remember that with any investment comes financial risk. Make sure you are in a position to start investing in old and rare Whisky. There are no financial Services Compensation Scheme for anyone looking into whisky investment therefore creating higher risk. Other unpredicted implications could include forgery or unprotected export duty which could leave you significantly out of pocket. Another factor to consider is that your collection is to be kept in top condition so consider how and where you can store your collection safely as it is worth a high investment.
Many distillers and whisky companies warn those who are looking to potentially begin investing in old and rare whisky to avoid forgeries. The best way to avoid this is to look for iconic and recognisable distillers such as Glenlivet and Lagavulin or to look into closed distillers and rare malt whisky websites.