While most of us, when we buy a whisk(e)y, simply drink it. But there is a whole hidden world of whisk(e)y investment where bottles can go for thousands at Auction.
To mark this year’s launch of the Diageo Special Releases Collection, we talk to Simon McGoram, National Whisky Ambassador for Diageo, about how to get started with collecting, what to look for and why it may not be the worst idea not to open the bottle.
PIN ITSimon McGoram, National Whisky Ambassador for Diageo
Why is whisky investment booming?
I believe that whisky investment is booming thanks to years of growing interest in the category itself. The 1980s an ‘90s were relatively low in production too with many once-successful distilleries forced to shut their doors (like Carsebridge in 1983 and Pittyvaich in 1993). As popularity in Scotch (and indeed world whisky) has grown, mature whiskies from these decades (and earlier), as well as from both closed and active distilleries are in high demand, with increasingly short supply numbers driving value.
Thanks to annual limited collections like the Diageo Special Releases there’s also an increased awareness on the collectability and investment potential of Scotch whisky.
Is it too late to invest?
It’s never too late to start collecting whisky and if you’re purchasing rare and interesting bottles they will increase in value over time. We’re into our 18th edition of the Diageo Special Releases and there really is something in this year’s collection for everyone and at many price points. From a 14-Year-Old Singleton of Glen Ord (RRP $180) – matured in no less than 5 different cask woods – through to venerable and precise expression of Caol Ila ($1250) – a 35-year-old and the oldest bottling from the original distillers.
And look even if you don’t make a fortune at least you left with something delicious and immensely satisfying to open and enjoy with friends and family. Whisky, after all, was made for drinking. I don’t see bitcoin offering this sort of insurance policy.
Like any investment, those playing the long game are more likely to see a reward.
Is there a Whisky bubble that could burst?
I think with some whiskies – yes – that’s a possibility – especially as more production comes online. One of the advantages of Scotch whisky, however, is that it is long established and less prone (though not immune) to market fluctuations, trends and fads.
Is it only single malts and special editions that are valuable?
No. Blends and single grains can be highly collectable too whether it be household names like Johnnie Walker or this year’s Cladach – a cask strength blended malt Scotch whisky from 6 fine coastal distilleries. Limited and special editions, do make a big difference, however.
Big brands or boutique distilleries?
Diageo might be a ‘big brand’ and own ‘big brand’ whiskies but essentially, it’s a conglomerate of 28 traditional malt whisky distilleries (with reserve stocks from ghost distilleries) operated and cared for by the world’s finest whisky craftsmen and women.
An advantage of buying a whisky from the Diageo Special Releases is that you can rest assured that only the finest casks – hand-selected by the original distillers – are used for each bottling. There’s no guesswork going on here when it comes to quality.
Only Scotch? Or are other types of Whiskey (Japanese, Irish or American Single Malt) worth exploring?
One of the beauties of the whisky industry – and one of the reasons I love it so much is the diversity – the width and breadth of the industry. There are great things happening in Australia, the USA, Taiwan, Japan, Wales, England, France, India and New Zealand. With differing regulatory laws in each country, we are not simply seeing ‘Scotch’ being recreated in new locations but completely different takes on whisky that have their own unique sense of place.
PIN ITSimon McGoram at the launch of Diageo Special Releases Collection
What are the main things to look for in an investment-grade whisky? Is rarity the only factor?
When looking at investing in whisky rarity is always a factor. Age, natural cask strength, whether it’s an official bottling or an indie bottling will all have an effect on value. The condition of the packaging and fill level are also key to look out for.
Is it worth collecting new releases? Or is it only aged bottles that are worth investing in? If new releases are worth investing in how important are industry awards?
Yes, new releases are worth collecting – preferably before they win awards! Whether you are a fan of awards systems or not they really can have a big impact on the value and demand for a whisky.
How much research should a potential investor do? And from what sources should advice come?
Most whisky auction sites will offer detailed information about the bottles they are selling. Never part with money you aren’t willing to spend – they trick isn’t in buying whisky for investment it’s in selling it – and that might require some patience.
Where do you buy whisk(e)y for investment?
Investible whiskies can be found in local retailers, speciality stores, online stores or through whisky auction sites. It all really depends on how serious you want to get. Online stores and auction sites can offer great value for money but there’s nothing like physically holding that bottle in your hand in a speciality retail shop. Part of the fun of collecting and investing in whisky is in the hunt!
I like Whisky Exchange, Master of Malt, Nicks, Langton’s, Bonham’s, and Whisky Auctioneer. Specialist stores like World of Whisky in Double Bay, Casa De Vinos in Port Melbourne, Leura Cellars in the Blue Mountains are worth a visit. Equally, I’ve picked-up great buys at chain retailers like Dan Murphy’s.
The announcement of the Diageo Special Releases is a highlight of the whisky calendar every year.
Does your location in the world affect access?
Your location in the world can affect access yes – but less so with the growth of online sales. Shipping and duty (particularly high in Australia) will affect margins and some releases are limited to certain markets – i.e. UK & Europe only.
How should an investment bottle be stored?
Store it upright, in the original packaging in a cool, dry place out of direct sunlight. Also, somewhere safe where a friend, family member, the in-laws or housemate is unlikely to accidentally open it.
Are there providence papers? How is a Whiskey authenticated? How do you spot a fake?
Fakes are certainly something to be cognizant of and this is an issue in the secondary market. This is where buying an official bottling – like a Diageo Special Release whisky – from a well-known retailer is the safer way to go.
Keep a record of purchase for all your valuable whisky where possible – for insurance purposes if nothing else.
There is a lot of work going into spectroscopy to analyse whisky and determine if something is real or fake. You need to have a proven authentic bottle to compare with but using an infrared spectrometer, in theory, should be easier and quicker than sending your liquid to a lab to be analysed.
How long should you hold onto a bottle before it’s worth selling? (i.e. How old are the bottles that are fetching decent prices?)
How long you hold onto a bottle for is really up to you, but the more patient you are the more likely you will be to see a return. Once a release has sold out is when it might start increasing in value and this could take a couple of years depending on the popularity and size of the release. Like any investment, those playing the long game are more likely to see a reward.
If an investor is looking to sell, which are the main auction houses/dealers to approach?
As mentioned above I think Whisky Auctioneer is a great site – but reach out to a few and find the right fit for you.
Should a potential investor also be buying through these houses/dealers or directly from the distillery?
Visiting a distillery is a great way to pick up some limited bottlings as most distilleries will produce a ‘distillery only’ expression these days. ‘Feis Ile’ or Islay Festival releases are highly prized, as are the Lagavulin Jazz Festival Releases. These bottles can be harder to part with though as part of the value of whisky linked the emotions or nostalgia it stirs in you. I know that I’m hanging onto distillery only bottlings as souvenirs from my visits there.
How does a potential investor decide whether an old whisky bottle is a decent investment or something to just enjoy?
Most auction houses will offer valuation services. If you have something you think is potentially ready to go to auction seek informed advice on its estimated value (from more than one source.
If someone is interested in becoming a potential investor, where do they start and what sort of money should they expect to be investing? How big should your collection be?
I know people you have collections 100s strong – but it’s the quality, not necessarily the size of your collection that’s important. Collectable bottles can start for as little as about $100-130. A cask strength Talisker 8-Year-Old in this year’s Special Releases – the first from the original distillers in over 30 years – retails for $130 and is a great way to kick off your collection.
Why does Diageo do a Special Releases Collection every year?
Well, the Diageo Special Releases were really born out of a growing demand in the ‘90s for distinctive, unrepeatable, cask-strength bottlings. Our first release in 2001 was just 3 strong – a mere 100 bottles of Talisker 28-Year-Old at 43.3% ABV which sold out instantly at £495, followed by a 25-Year-Old Talisker and a 22-Year-Old Port Ellen which sold out just as quickly.
That first release Port Ellen was originally for sale for £110 and is now (if you can find it) worth about £4500. Over the years the Special Releases has worked as collection whether we are able to showcase not just our Classic Malts but bottlings from distilleries that rarely have released under their own banner, or rare reserve stocks of whiskies from ghost distilleries (those no longer in operation, but the spirit remains) like the famed Brora or this year’s Pittyvaich 28-Year-Old.
A rich and robust cask strength Lagavulin 12-year-old was introduced in 2002 and has become a real stalwart of the range. An unpeated Caol Ila ‘Highland Style’ has garnered a cult following after being introduced to the range in 2006 and can’t be found bottled anywhere else.
The announcement of the Diageo Special Releases is a highlight of the whisky calendar every year. This is our 18th collection and there have been 163 releases to date – all highly prized and some exceedingly rare.
This year we launched the Collection with a competition for members of the public to win the entire collection by deciphering clues to unlock a padlock securing the full collection outside Customs House, Sydney. The lucky winner now has a very unique range of whiskies to add to his drinks cabinet!
What is unique about this year’s collection?
The new Special Releases Collection is a year of firsts. We have our first bottling of a triple matured Singleton of Glen Ord – aged and married in no less than five different cask woods (we believe the first time this has been done for a single malt Scotch). We have our first appearance of an Inchgower a historic coastal Speyside malt rarely seen on these shores. We have our oldest ever bottling of Carsebridge a 48-year-old single grain Scotch whisky with a mere 1000 bottles produced.
There’s a unique cask strength blended malt the Cladach – Gaelic for the ‘shoreline’ – a blend of six fine coastal distilleries Oban, Clynelish, Inchgower, Talisker, Lagavulin and Caol Ila.
We have an ethereal and maritime 21-Year-Old Oban rare to see aged solely in European oak. We have out oldest ever bottling of Pittyvaich a 28-Year-Old – now much older than the lifespan of this ill-fated distillery that was in production from 1975 -1993. There’s the first 8-year-old Talisker from the original distillers in over 30 years.
And last, but certainly not least there’s the oldest bottling from the original distillers of the elegant Islay malt Caol Ila – a 35-year-old – a well-balanced and mature expression that shows a fine freshness and precision for its age.
So, as you can see ‘special’ means special…
Should someone who is looking to start collecting, invest in these?
In short… yes. I know I will be.
