“For avid whisky collectors and those who want to make money from this age-old asset class, whisky casks present an ideal opportunity to mix business with pleasure,” says Alexander Knight, CEO and co-founder of the Singapore-based Whisky Cask Club, which specialises in the investment of entire whisky casks.

He states how alternative investments like whisky, which have little correlation to the performance of traditional markets, should make up at least 20% of anyone’s portfolio, serving as a natural inflation hedge. “In inflationary times, ensuring wealth protection is vital.”

“Whisky casks have exceptional annual growth. Clients can choose barrels of their favourite brands and buy them directly from us at the Whisky Cask Club.” He elaborates: “As a Singaporean company with offices in the CBD area, we are able to run tastings several times a month. We are also able to discuss in-person with an investor what they are looking for, and what kind of budget they have and go from there.”

Knight, who got into the trade during the pandemic, notes that most clients in Asia want on-the-ground expertise, and having a base in Singapore provides a place where they can pop by for a chat while having a dram or two.

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Citing that all single malt Scotch are investment grade, thus their focus on these particular whisky expressions, the company has also made sure to develop fully insured bonded warehousing facilities in Scotland. That’s where the physical casks are looked after, and where investors can actually visit in-person.

For long-term investment, Knight believes investing in casks is superior to bottles. “Risk is reduced without needing personal storage, insurance, and shipping. The ageing liquid guarantees increased returns, whereas the brand popularity bottles rely on can vary. The bonded warehouses overseeing the casks guarantee the liquid will remain safe and continue to deepen in flavour. With age, the profit a barrel will yield can be easily calculated.” 

He recommends holding on to them for five to 10 years, during which it will typically double or even triple in value. “The beauty of this is that the barrels are fully insured and well looked after by whisky experts, meaning that it is the best possible environment for them to appreciate in value,” adds Knight.

Just last month, the Club also launched the Whisky Cask Fund, the only fund of its kind to be regulated by the Monetary Authority of Singapore (MAS), and which allows accredited investors (based on definitions by MAS) a unique vehicle to invest in premium whisky casks at competitive rates. A minimum investment sum of US$50,000 (about S$70,000) is also required.

“We decided in February this year that some sort of fund would be an additional feather in the Whisky Cask Club’s hat as it brings an alternative investment asset class to those who want the comfort of a regulated entity that holds the casks,” explains Knight.

“The fund allows us to create greater profits from actively trading casks. The business is highly liquid. 22 million barrels of whisky are ageing in Scotland now and 44 bottles are exported from Scotland every second of the day. This means that there is virtually unlimited scope for cask trading.”

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An allure of whisky investing is also how simple to understand it can be. “One of the most delightful aspects of the whisky business is the supply and demand disparity,” says Knight. “The best performing whiskies are what would be expected, with the likes of Macallan, Dalmore, Craigellachie and GlenAllachie. Although Macallan casks are rarer than gold dust.”

As testament to the benefits of investing in whisky, he notes its current global massive surge in demand, especially in Asia, where spirits sales are setting new records. “China and India are rapidly growing markets for all spirits, but Scotch whisky is king.”

Knight quips: “It’s incredibly straightforward. The inimitable American writer and satirist Mark Twain said it best: Too much of anything is bad, but too much good whisky is barely enough.”

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