It may be wiser to invest in whisky than drink it! (2024)

As the autumn days draw in, whisky lovers turn to a dram to ease the onset of chillier evenings and longer nights.

But it's not just those who like a tipple who are enjoying whisky – collectors have also been reaping rewards.

The value of the 50 top whiskies has risen by 20 per cent over the past year alone – and by 152 per cent over the past five years, according to Bordeaux Index.

A 30-year-old Port Ellen is now worth £1,950 a bottle – 259 per cent more than five years ago.

A 30-year-old Balvenie has risen in value by 85 per cent in two years to £1,800 a bottle.

The best are selling for tasty sums. Next month, a bottle of 1926 Macallan is going under the hammer at Sotheby's – with a valuation of £1.2 million.

This single malt Scottish rarity is one of only 40 bottled from a single batch and has an illustration by artist Valerio Adami on the label.

Jonny Fowle, head of spirits at Sotheby's, says: 'This bottle represents the oldest Macallan vintage ever produced.

'After being aged in sherry casks for six decades, this whisky was bottled in 1986. The bottles were not made for purchase – but offered to top clients.

'Of the 40 produced, one was hand-painted by Irish artist Michael Dillion, a further 12 were labelled with images produced by pop artist Sir Peter Blake, and another dozen labels were designed by the Italian painter Valerio Adami.'

The good news is that you don't need £1.2 million to invest – you can start with a couple of hundred pounds.

But there is no guarantee you will make a profit. Many people invest for the pleasure of learning more about whisky and having a bottle to open on a special occasion. As with any alternative investments, they should only form a small part of your portfolio.

Even if you already enjoy whisky, working out how to start investing may seem daunting.

But Ewan Thomson, a whisky expert at the specialist spirits auction house McTear's Auctioneers in Glasgow, believes it doesn't need to be – in fact it can be a great pleasure.

'My advice is to start with the whisky you particularly enjoy, and develop an enthusiasm for the drink that way,' he says.

'You might visit distilleries and go on tasting sessions to learn more and buy bottles from auction houses. You do not need to spend a fortune. Begin with a modest budget of a couple of hundred pounds. Start as an enthusiast wanting to learn.'

Blended whisky accounts for about 90 per cent of all Scotch consumed – and though a delicious dram it is not to be purchased as an investment.

For an investment, you will need single malt, where whisky comes from a single, named distillery.

Investment quality whisky must usually have been aged in a barrel for at least a couple of decades. Irish whiskey can also be a good investment.

Macallan is very popular among investors, but there are plenty of other highly regarded distilleries to consider.

They include Ardbeg, Balblair, Balvenie, Bowmore, Bruichladdich, Dalmore, Glendronach, Glenfarclas, Glenfiddich, Glenlivet, Glenugie, Highland Park, Kilchoman, Laphroaig, Lochside, Springbank and Talisker.

There is also demand for spirits from distilleries closed in the 1980s and 1990s, even though many have reopened or are set to reopen.

These include Brora (before it reopened in 2021), Dallas Dhu (which is set to reopen), Glen Flagler, Port Ellen (reopening this year), and Rosebank (which reopened earlier this year).

Investment demand is for the whisky before the distillery shut, as there is a diminishing supply of this every time a bottle is cracked opened on a cold night

Thomson says whisky bottled in the 1980s and 1990s can be a great place to start – when there were more small distilleries and fewer mass produced bottles.

Among his favourites is Springbank, which is based in Campbeltown on the Kintyre peninsula.

You can buy a 15-year single malt Springbank that was bottled in the 1990s for £1,000. Fowle adds that a wave of investors are seeking out whiskies from Islay in the Inner Hebrides, such as Bowmore and Port Ellen.

'But I also see people trying to find whiskies with the least wood-influence possible – pale whiskies such as a Laphroaig Samaroli 1970,' he says.

'Glendronach offers some of the best priced quality sherried whisky, Kilchoman gives one of the best bangs for your buck when it comes to peat smoke flavour.'

A 26-year-old 1993 Glendronach might cost £550 while a Laphroaig Samaroli 1970 can set you back £8,000.

An 11-year-old Kilchoman Oloroso – the distillery only opened in 2005 – is available for £300.

The age of a whisky is the amount of time it was kept in a cask before being put into a bottle.

Once bottled – unlike wines – they can be stored indefinitely without going off, provided they are kept upright in a cool, dark place.

A 12-year-old put aside for a century will remain the same age as a recent 12-year-old – and may taste much the same.

Whisky sales are held by auctioneers including Sotheby's, McTear's, Bonhams, Scotch Whisky Auctions and Whisky Auctioneer.

Although auctioneers can charge a fee of typically up to 24 per cent on top of the hammer price, buyers have protection against buying whisky with fake provenances.

Beware of buying blind from websites such as eBay as whisky trading is an unregulated market not covered by the Financial Services Compensation Scheme.

Five years ago, a study conducted by the Scottish Universities Environmental Research Centre in East Kilbride found that almost a third of the whiskies it tested were fakes.

The website Rare Whisky 101 provides details of what is going on in the market, with details of individual distilleries. The website LiveTrade also provides an index of the performance of individual whiskies in recent years.

Matthew O'Connell, chief executive of Bordeaux Index, says: 'Whisky is a fascinating market with distilleries having to look two or three decades ahead – when some of their finest tipples might be drunk.

'The 1970s to 1990s – when many of the whiskies we are drinking now were produced – is a time when distilleries were struggling or closing down. This boosts the value of the limited number of survivors.

'The European and Asian market for investment quality whisky is still growing – and we do not see this slowing any time soon.'

Although the vast majority of investors buy their whisky bottled it can also be purchased in the barrel and kept in a 'bonded' warehouse.

If it is bonded the investors can avoid paying any duties or VAT if it is later sold back to the producer. But novice investors are advised to start off with bottles and to gain some experience of trading before they consider barrels.