Is Investing in Whisky a Good Idea?

Are you a whisky lover who is looking to take your enthusiasm to the next level? If so, why not start within the collecting and re-selling business?

Whisky investment has become popular among investors and collectors alike, especially in the UK. From rare Scotch releases to limited-edition bottles, whisky can increase in value over time, bringing a great return on investment. 

But do the benefits outweigh the costs? In this blog, we’ll explore the appeal of whisky investment, the potential risks associated with it, and advice for those who want to step into the field.

Why Whisky is Gaining Attention as an Investment

As with many rarities in art and fine wine, when there is a scarce supply of something, its value significantly increases. 

Old and rare whiskey's are hard to come by. Just this November 2023, a bottle of 1926 Rare Macallan single malt sold at an auction for nearly 2.2 million. 

Given how popular whisky has become throughout the centuries, collectors will pay substantial amounts to acquire a rare piece for their collection. 

While not every whisky will be sold for nearly as much, fine whiskey's made using time-consuming production methods and high-quality ingredients can increase their value.

With the rise of middle-class citizens and disposable income, more people are willing to spend thousands or millions on rare or luxury items.

Types of Whisky Investments: Bottles vs. Casks

There are two main types of whisky investments: bottles and casks. Each path comes with its own advantages and drawbacks.

Bottle investment 

This is the most accessible route for first-time investors. You can start by collecting old and rare whiskey's or limited editions that can be easily stored in your home. 

Collectable bottles are in high demand, so they are easy to acquire and sell. Certain bottles, especially limited editions or releases from well-known distilleries like Macallan or Glenfiddich, can quickly gain a lot of value.

These can be bought in local shops, auctions, or distilleries.

Cask investment 

Cask investment is a bigger commitment than bottle investment. This can have more rewarding outcomes; however, it’s hard to find a cask to invest in, especially as someone new to the business.

As whisky ages and matures in casks, its value can improve over time. Casks also contain over one hundred bottles worth of whisky, meaning you can bottle it up and sell it individually, offering flexibility. 

However, casks must be stored in a bonded warehouse to properly mature. 

Understanding the Risks of Whisky Investment

Like any investment, investing your time and money into whisky comes with its fair share of risks. 

Deciding whether whisky investment is a good idea depends on whether the benefits outweigh the risks for you.

1. Market Volatility and Price Fluctuations

The price of any bottle or cask of whisky can fluctuate over time due to market trends and economic factors. This means that you can’t accurately determine whether you’re investment will be worth it in the end. 

• How to mitigate: Research market trends before buying and aim for a variety of brands, ages, and styles of whiskey's.

2. Storage and Preservation Issues

Proper storage is vital when it comes to whisky collecting to ensure the whisky remains in great condition. Failure to do so can result in your whisky becoming damaged and, therefore, less valuable.

• How to mitigate: Store any bottles upright, away from sunlight and in a cool, dry place. Store any casks in a bonded warehouse to prevent leakage or evaporation.

3. Counterfeiting and Authentication Concerns

Counterfeit bottles are a cause for concern in the buying and collection of whisky. 

You can be conned into buying a cleverly produced counterfeit bottle, and prestigious distilleries are the most likely victims. Verifying a bottle from secondary markets or auctions can be challenging.

• How to mitigate: Only buy from established retailers, distilleries, or licensed auction houses. You can also use authentication services for high-value or rare whiskey's.

4. Liquidity and Selling Constraints

Whisky isn’t a highly liquid asset, meaning it can take time to buy and sell, depending on market demand.

The selling process can also result in shipping costs, auction fees, and insurance requirements. 

• How to mitigate: Plan a clear selling strategy before you begin investing to ensure you can sell your whisky within a reasonable time frame. Avoid investing money that you might need to access quickly.

Tips for Getting Started with Whisky Investment

So, before you dive straight into the world of whisky investment, it’s important that you understand the basics behind succeeding.

But don’t worry, we’ve got you covered! Here are some essential tips to help you get started:

1. Do your research: Research the different whisky types, the most reputable brands, and the current market trends and demands. Brands like Macallan, Glenfiddich, Yamazaki, and Bowmore are known for their investment-grade whiskey's.

2. Build your collection gradually: It’s best not to jump in the deep end straight away. Start by investing in affordable and easy-to-obtain whiskey's. Opt for limited-edition releases or whiskey's from popular brands.

3. Aim for diversity: Don’t stick to one type or brand of whisky. Start collecting a variety of bottles or casks, prioritising limited editions or special releases as they become more scarce and valuable over time.

4. Buy from reputable sources: As previously mentioned, buying from established retailers, distilleries, or specialists will ensure you're investing in genuine products. Always authenticate rare whiskey's with experts before buying.

5. Plan your investment strategy: Set your goals early so you know what whisky to aim for. Do you want to make quick money with limited edition bottles, or can you wait a decade to achieve larger gains with casks?

6. Engage with the whisky community: Join whisky clubs, online forums, and groups to keep up with the latest trends and gather expert opinions. This will help you spot potential investment opportunities and get ahead of your competition. 

Browse Miniature Collectable Whiskey's at Whisky Tasting Company

What better way to kickstart your collection with our miniature collectible whisky sets?

With a range of old and rare whiskeys available, you can add a few key pieces to your collection or try out a variety of new flavours.