The drinks master: Should I invest in fine wine or rare spirits?
Fine wines are undoubtedly having a moment. With stocks seeing a higher return than gold, and with global investment growing by three per cent a year, this shows little sign of stopping.
But is wine really the best beverage to invest in? With rare and fine whisky sales reaching £25m in the UK alone in 2018, it seems that investors are looking beyond the wine cellar to invest their cash.
If you’re considering putting your money where your glass is, there are some key factors to consider. It’s stating the obvious, perhaps, but wines will always have the advantage of the vintage; put simply, a certain number of bottles are produced, and once they’re gone, they’re gone. Over time, the supply of a given vintage will decrease as bottles are consumed, increasing the value further, which is why the value of wines such as the 1989 Chateau Haut Brion soars over time – bottles were originally sold in 1989 for less than £100, but now sell for over £1,400.
While some rare spirits follow a similar model, they are much harder to come by. One such example is the Johnnie Walker Queen Jubilee, the spirit matured since 1952, finished in a cask of English oak from the Queen's Sandringham Estate and bottled on 6 February 2012 in a Bakara crystal bottle, which now retails for over £120,000. For investors with a lower budget, look out for small distillery rare batches to invest in. Spirits from distilleries that have closed will often rocket in value.
The other key factor to consider is ageing and conservation conditions. The value of a fine wine relies heavily on quality; once a bottle is approaching its peak the value will increase dramatically but will stagnate and slowly decrease once peak condition has passed. A bottled spirit will neither improve nor get worse over time, which means that the value will continue to increase as supply diminishes. It is worth noting that as wines tend to be consumed more quickly than spirits, it will take longer for the latter’s value to increase.
The requirements to store rare spirits in good condition are minimal: you just need to make sure that the bottle is not kept under bright light or exposed to extreme temperatures. Fine wines are much more sensitive, and often require costly investment to ensure they are stored horizontally at exact conditions of humidity and temperature.
So fine wines tend to offer a faster and higher return, but their value is more likely to wobble, and there are often significant storage costs involved. For those looking for fuss-free investment, rare spirits can offer a safer and lower-maintenance choice.