I’ve simplified my financial strategy into one simple statement ” work for my money in the short term and let my money work for me in the long term”. When you think investment portfolios your thoughts quickly go to instruments such as bonds and stocks but it seems whisky is now replacing bonds and stocks as investment options with investors now reaping heavy benefits from this new trade.
Rare bottles released by big brands are being sold at high prices on auction with a recent example coming from Glenlivet which sold bottles of 50 year old whisky with each bottle worth £18,000 (approximately 2.5 million Kenyan shillings).
“Since the first whiskey index was formed six years ago, top single malts have risen in value by more than 660% — easily beating the performance of stock markets and other assets. In January, a single bottle of Macallan “M” scotch sold for a record $628,205 at auction.” (CNN Money)
The process of aging for whisky makes older bottles rare and valuable. For example, a bottle of 1937 Glenfiddich scotch, aged for 64 years, sold for £46,000 ($72,000 or approximately 6.3 million Kenyan shillings) at a Christie’s auction in 2012. Only about 60 bottles were originally produced.
Last year the world’s only whiskey investment fund was launched and is managed out of Hong Kong. They’ve stocked up more than 3,000 bottles, primarily from Scotland and Japan.
According to Whisky Highland, some of the investment principles to note when you want to go into the business include.
“(1) The first, and indeed main thing you need is a passion for whisky. If the market ever crashes at least you’ll still have a great drink as consolation!
(2) The second is patience! Whilst short term gains are possible, whisky should be viewed as a long term investment. 10 to 20 years is usual.
(3) NEVER invest what you cannot afford to lose.
(4) Understand the market inside and out. You wouldn’t invest in a company you hadn’t researched. The same principles apply with whisky.”
Investors are also warned to fight the temptation to pop opne one of the bottles and pour yourself a night cap 😉