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Growing your money in whiskey bottles, and the pitfalls of doing so

By dailymail / Published on Friday, 16 Jun 2017 06:03 AM / No Comments


Asia’s massive population and their expanding wallets have made the region a fertile ground for whiskey sales. Along with that came a group of aficionados who saw the potential to grow their wealth by investing in bottles of the distilled liquor.

The principle behind it is simple: buy bottles of rare, limited edition whiskey and sell them at a higher price later on.

Returns can be lucrative. An index tracking the value of the top 1,000 Scotch whisky bottles grew 61 percent between Jan 1, 2013 and Sept 30, 2015, said Matthew Fergusson-Stewart, regional brand ambassador for Glenfiddich, citing data from a consultancy called Rare Whisky 101.

During the same period, the FTSE 100 was up 1.5 percent and shares of alcohol group Diageo was up 3 percent, he told CNBC in an interview.

“Whiskey is very, very stable in the bottle if you follow some basic rules to care for it. It can last easily a hundred years,” he said.

“If you take a really good bottle, it’s produced at a certain time and it’s not going to be produced again, you got scarcity of a great product. Value is going to go up and people are going to want to hold that and sell at a later date to make some money from that.”

And that movement is taking off in Asia, the region tipped to be the world’s wealthiest by 2019.

Asian whiskey enthusiasts have displayed bigger investment appetites than their Western counterparts who are mostly collectors looking to grow an inventory, instead of flipping the liquor for a profit, noted Mike Soldner, founder of B28 Whisky Fund.

B28 is a Singapore-based entity that pools money from individuals to invest in whiskey. The fund turned in a 20 percent gain in its first year and aims to lock in around 15 percent this year, Soldner told CNBC.

“Our pool of investor is still small so if any of our investors want to exit, they have to sell their stakes to remaining investors or they can exit with stock, and in whiskey bottles. Of course with a larger pool we’ll probably get to a stage where people can cash out,” he said.