‘Whisky investment is risk-free’
Like any investment, whisky cask investment carries risk. There are no guarantees that the value of your investment will increase. Market trends can change, and the ‘value’ associated with a particular product can rise and fall along with it.
The existence of fake and counterfeit whisky casks can also add an extra layer of jeopardy into the mix. Which is why it’s important to understand what you are investing in and have confidence in the legitimacy of the offer.
At Whisky 1901 we pride ourselves on the transparency and openness we offer to clients when it comes to their whisky cask investment. We want them to be able to see and experience it and have real confidence in the choices they make. This means being able to visit and taste their cask, giving them regular updates and advice, and providing them with the reassurance that their investment is being looked after.
‘Any limited edition is a good investment’
While a limited-edition whisky certainly has appeal and a feeling of exclusivity, it doesn’t mean that it will appreciate. There are many factors which affect appreciation. These include the history and heritage of the distillery. The quality of the release. And market demand.
To maximise potential for our clients we only deal with Scotland’s top 10-20 distilleries. These distilleries are proven creators of Scotch that is perennially in demand. Owned by brands including Diageo, Beam Suntory Holdings and Edrington Group, these distilleries invest their money back into marketing and tourism which, in turn, increases the brand value and credibility.
‘You must store the whisky yourself’
Proper storage conditions are crucial to maintaining a whisky’s value, and professional facilities offer optimal conditions and security. When it comes to Scotch whisky, there is also a legal requirement that it stays in Scotland in a HMRC registered bonded warehouse. There are many factors that can affect the appreciation of your whisky cask, many of which are due to the way it is stored and the cask it is stored in.
To ensure cask integrity and give our clients the best opportunities for success, we recently moved the majority of our casks to the Lowland Bond facility in Fife. To aid transparency, all casks are barcoded and carry information from source to bottle. Cask safety is also a top priority. CCTV coverage, fire and intruder alarms provide added reassurance and added protection.
A weekly visual leak check is performed by facility staff, to make sure casks have not sustained any damage. If a leak is detected, the facility will repair the barrel. Strict temperature controls also ensure casks are kept at the optimum temperature to minimise the risk of cask expansion.
‘Whisky is immune to economic downturns’
Although whisky can perform well during economic downturns due to its collectible nature, it is not completely immune to broader economic impacts. Today, the Scotch whisky industry is going from strength to strength, providing £7.1bn in gross value added (GVA) to the UK economy. But that is not a guarantee that the industry will be unaffected by wider impacts in the future.
That is why understanding the risks as well as the potential rewards is imperative. Past trajectories will give a glimpse into the low volatility of the market and your investment potential but are not necessarily an accurate reflection of how the asset will perform in the future. Only by regular market monitoring can you make the best decisions.
Our investors receive quarterly updates on current whisky market news. Every two years, they receive analysis of their specific investments with projected ROI based on market prices. Quarterly investment updates from consultants also provide information on current whisky market performance. In addition, our investors can also access details of their investment portfolio via an online dashboard.
To find out more about the market and how to invest in whisky, or to speak to one of our team, get in touch.
**Disclaimer**
Whisky cask investments are unregulated in the UK. The value of investments is variable and can go down as well as up. You have 14 days to change your mind and request a full refund under our cooling-off period. The volume of spirit will decrease over time (known as “the Angels’ share”). “New Make” spirit has to be matured for 3 years, during which time its alcoholic strength could be reduced. However, for the product to be classed as “whisky”, it must retain a minimum strength of 40%. Fees apply, see terms and conditions for details and terms around exiting your investment. An investor may get back less than the amount invested. Information on past performance, where given, is not necessarily a guide to future performance. The capital invested can fluctuate and the price of casks can go down as well as up and is not guaranteed. The investments and services offered by us may not be suitable for all investors. If you have any doubts as to the merits of an investment, you should seek advice from an independent financial advisor. The Whisky 1901 Ltd sale price includes a discretionary markup to cover the cost of services provided, including but not limited to, storage, movement and maintenance of casks, insurance, front and back-office software.
