FREQUENTLY ASKED QUESTIONS
Our most commonly asked questions, answered by our experts
Whisky has proved itself to be an excellent alternative investment. As a tangible asset, it offers more financial security than stocks and shares and the nature of whisky means that it rises in value as it matures. Historically, Scotch Whisky has delivered returns of 15% pa over the last decade and whisky casks are amongst the safest and most secure assets you can hold.
Whisky investment is the purchasing of rare whisky, either in bottles or casks, for the purpose of selling it on at a later date for a financial profit.
Until recently, cask whisky was difficult to purchase. So, unlike equities and bonds, it’s not a ‘crowded trade’. Buying tangible assets gives you more financial security as products can’t go bust like organisations can. It makes buying a cask of whisky a much more attractive option.
A cask is the wood that whisky is stored in while it matures and it plays a critical role in developing flavours. Casks can come in all different sizes and wood types, but the most common type used for whisky is a 200l ex-bourbon barrel that was originally used to mature American Bourbon. However, whisky is regularly matured in other types of casks including sherry, wine and tequila, all of which bring their own flavours to the spirit.
Whisky is unlike many stored goods – it develops and increases in value as it ages in the cask. Purchasing casks instead of bottles is a specialist approach. But, it’s much more profitable in the long term. Unlike wine, whisky doesn’t mature in the bottle. Once Scotch Whisky is bottled, there will be no change in its flavour. The age statement on the bottle refers to the amount of time it has spent maturing in the cask. Its ‘age’ doesn’t change even if the bottle is kept for decades. A 10-year-old whisky will always be a 10-year-old whisky once bottled. Generally, the longer that you leave the whisky in the cask, the higher quality it will be. So, older whiskies command higher prices. Purchasing casks means you are receiving a product that will improve and develop over time. Also, tax on whisky in the bottle is much higher per LPA, (which stands for Litre of Pure Alcohol – the measure used by the whisky industry to account for the alcoholic content of a spirit), than on spirit in the cask. There is no duty charged on the whisky as it’s maturing in a bonded warehouse either, which makes it very tax efficient.
Yes, your casks are fully insured from the start of your ownership. Our premiums are adjusted annually to allow for the rise in value of each cask, ensuring each and every cask has the appropriate level of cover. The insurance covers damage (including accidental damage), full loss and theft and we give you insurance prepaid for a term.
Once you have bought a cask from us, you are entering into a sales and purchase agreement, just like any online purchase, like buying something from Amazon and at this point, you will receive a receipt confirming your purchase and all of the information about cask storage and insurance. You will be given a certificate of ownership which will include your unique cask number that relates to the exact distillery where the cask is stored, along with the technical information about your cask. This will include the wood type, the distillery of origin, the spirit name inside the cask and an ABV (alcohol by volume) as a minimum.
You can remove your cask from the bonded warehouse whenever you like. However, it’s important to remember that you will be liable for any customs and excise duty and VAT due from that point onwards.
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