Due to Covid-19 restrictions, the investment market has been turned on its head and for the first time in years, we are not only seeing alcohol emerging as a hot commodity but a luxury asset class that is more sought-after than traditional investments. In 2020, savvy investors are turning their backs on alternative investments such as art and wine, and are turning towards whisky as an investment opportunity. It seems that Covid-19 has only accelerated this trend. In an unpredictable economic climate, whisky has provided investors with more bang for their buck. But how does it fare against art?
Boasting a surge in value of 5% over a 12 month period, whisky and art are currently two of the most lucrative passion investments, with whisky being listed as an ‘object of desire’ in the latest Knight Frank Wealth Report. Others have revealed that the whisky cask industry is thriving, and while art shows a 141% growth over a ten year period, whisky comes out on top with an impressive 564%.
Back in 2018, art took the top spot as one of the most valuable luxury asset classes while whisky didn’t even feature on the list. Fast forward one year and whisky is not only featured on the Knight Frank Luxury Investment index but it’s leading the way. While the art market mirrored whisky’s respectable annual growth of 5%, for the first time, whisky overtook art with a staggering 564% ten year growth.
Covid-19 has impacted the way we make, save and invest our money but how has it impacted the whisky investment market? Unlike the value of art which decreased in the early months of 2020, the growth of whisky values have gone from strength to strength. The pandemic has forced investors to take stock of their investment portfolio and diversify it. And while the art investment market has been left treading water, the whisky industry is thriving. It’s clear to see that no other asset class comes close to whisky when it comes to growth.
As the fear surrounding the global pandemic grew, traditional asset-backed investments plummeted leaving investors looking elsewhere for a safe investment. One that wouldn’t be affected by a volatile economic climate, and they settled on whisky.
The BC20 Whisky Cask Index has revealed that despite the global pandemic, the whisky cask market has seen continued growth in 2020 with a projected growth of 13.09% annually. This shows that even in an unpredictable financial climate, whisky is providing a stable investment option.
In the past few years, we’ve seen whisky become just as covetable as other passion investments such as cars, wine and art, however, in the past 12 months we have seen whisky investment overtake other forms of investment and emerge as the top way to build and safeguard wealth.
When comparing passion investments, the Knight Frank Luxury Investment Index shows that the growth of value when it comes to whisky far surpasses that of art, so if you want to put your money in a passion investment in 2020, you are sure to get a better return by investing in whisky that art.
Scotch whisky exports are currently valued at £4.91 billion and with values only predicted to rise, it’s clear that whisky collectors are setting the pace when it comes to profitable investments in 2020.
Is it time to make a passion investment?