01 Dec Scotch whisky the star performer when it comes to investing cash
SCOTCH whisky is a star performer when it comes to investing your cash, a new study has revealed.
According to data collected by the Lloyds Banking Group, investing in Scottish whisky is a better option than ploughing money into fine wine or watches.
The value of rare scotch whiskies has increased dramatically over recent years and outperformed gold and wine in 2015 with a record-breaking year at auction.
The value of some bottles of Scotch has gone up by 350% in the eight years since 2008, returning a profit of up to £1,000 in some cases.
The strong performance is expected to continue over the next decade, with investors expected to enjoy a return of over 40% on the best single malts.
The UK-based study shows whisky investors are the happiest of those investing in their hobbies and interests.
88% of those who have invested in scotch whisky are satisfied with its performance over the past year, compared with 66% for fine wine, 62% for sports memorabilia and just 61% for those who buy watches.
Limited edition bottles are considered top performers. A 2004 Special Release Mortlach 32-year-old from Dufftown, Moray, was available on the open market for £160 just three years ago but has shot up in value rapidly and can now fetch over £500 at auction.
Vintage whiskies are also performing well. A 1951 Gordon & MacPhail ‘private collection’ bottle from Elgin, Moray, was available for £360 in 2012 but now sells for £1,200.
According to whisky analyst, Rare Whisky 101, the value of rare whisky has increased by 361% since 2008.
The company also predict that whisky investments will continue to perform well over the next ten years, with an expected return of 41%.
2015 was a record year for whisky investment, with the industry index rising by 14.36% for the amount invested, whilst the equivalent for wine fell by 0.42% and gold fell by 10.44%.
The Lloyds study also predicted that whisky will attract further investment over the next decade, with spending increasing by £5,700 in one year’s time, £8,600 in five years and £9,300 in 10 years.
Brora, in the Highlands, is the best performing distillery for returns on investment, whilst seven of the top ten have now closed, showing the demand for rare bottles.
Andy Simpson, co-founder of Rare Whisky 101, said: “The growth of the secondary market for rare single malt whisky, both in terms of volume and value, has exceeded all expectations.
“While the sustainability of these volume increases could be called into question, we know for certain that the true rarities will only become rarer.
“Should demand for these rare treasures continue on its current trajectory, as is fully expected, Scotch’s credentials as a viable passion investment asset class continue to look particularly attractive.”
Markus Stadlmann, Chief Information Officer, Lloyds Private Banking said: “In investment terms, work and play do not need to be mutually exclusive, and with the right investment approach it is possible to make your interests pay.
“Often tangible assets, such as whisky, retain their value and are not eroded by inflation.
Investing in something you enjoy is a great way to make your portfolio unique to you.”
Behind Brora in the list of the top distilleries for investment, are Killyloch and Dalmore. Dallas Dhu moved up 13 places from 2014 to 11th in the table.
Glenfiddich is ranked 30th in the table whilst Glenlivet dropped out of the top 30.
Experts have cited poor quality liquid and the withdrawal of the 12 year old as potential reasons as to why rare whisky buyers are turning away from the Glenlivet brand.