If we’re talking investments, the S&P 500 can’t be ignored. It’s been used as the benchmark for overall market performance for a long time. Investors use the S&P 500 to gauge how well their investments are performing at any given time. Is the investment on par with the S&P 500, or is it dipping below?
It’s natural to wonder, then, how whisky cask investment stacks up against the competition. In fact, you wouldn’t be doing your due diligence unless you learned the facts behind whisky casks and how they hold up when compared to the traditional stock market.
Numbers Don’t Lie
When you’re dealing with investments, you always have solid proof of performance. Just look at the numbers. There’s no arguing that one investment outperforms another unless the numbers demonstrate that.
What does that look like for whisky cask investments?
Whisky casks saw a 12.5% average annual growth between 2015 and 2019.
How about the S&P 500?
That only came in at 10.2% during the same time. Those numbers don’t lie.
What makes whisky cask investing so special that it can outperform the industry standard of traditional stock market investing? Keep reading to learn how whisky sets itself apart from traditional investing.
How Whisky Casks Outperform the S&P 500
The Tangible Difference
Whisky casks are a tangible asset. That means when you buy a whisky cask, you own a physical cask of whisky, including the spirit it contains- the same way you own a car or your home.
That’s the largest difference between investing in whisky casks and investing in traditional “paper” investments on the stock market. Your whisky cask can always be sold, bottled, and consumed by lovers of whisky worldwide.
Whisky held in casks goes through a natural maturation process. The spirit in the cask on day one is much different than the spirit in the cask at year 25.
As the whisky ages in the cask, it only increases in value. A 25-year-old whisky is worth significantly more than a 5-year-old whisky. Investors, like you, can capitalize on the natural appreciation of whisky casks by holding onto a cask for five or more years.
Mature whisky casks are dwindling in supply. Enthusiasts and collectors are paying top dollar for them because they’re becoming more and more scarce as time goes on.
While the increased demand for mature whisky casks is great for distilleries, it’s not quite as simple as just making more whisky. A mature whisky takes at least three years to mature, but the casks that enthusiasts and collectors seek out are ten plus years old.
That kind of waiting period means the casks left out there today will continue to be in high demand even with distilleries operating at full capacity.
Low Market Correlation
All these factors mean that whisky casks don’t necessarily follow stock market trends. If the market is down, your cask can still be bottled and sold because of its intrinsic value.
Unlike traditional paper investments, whisky casks naturally appreciate in value as they mature. You’re not betting on a company to make the right decisions to add value to your portfolio. Instead, you’re relying on one of the oldest, tried and true processes known to man – the distilling and aging of Scotch whisky.
What Does it Take to Invest in Whisky Casks?
Investing in whisky casks might seem complicated. After all, what are you going to do with a cask of whisky- put it in your garage? Not exactly.
You won’t have to worry about storing and handling the cask at all. Any casks that you purchase are held in a government bonded warehouse in Scotland to ensure your asset is protected and monitored by the experts as it matures.
Facilitating the purchase is a simple process that only takes a few days if you have a team of experts behind you. A dedicated advisor will work with you to choose the best cask based on your preferences and, of course, what whiskies or distilleries you like best.
Selling is just as easy. Braeburn Whisky gives you access to a platform of enthusiasts, independent bottlers, collectors, and other investors around the world when you’re ready to sell your casks. With the help of your dedicated advisor, you can determine the best time to sell and the price point you’d like to set in order to make the most profit from the investment.
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