May 31, 2023

The Key Benefits of Whisky Ownership and Potential Risks to Consider

In this article we take a deep dive into the many benefits of whisky ownership, as well as sharing some of the risks to consider when exploring whisky ownership.

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If you are wanting to build your portfolio, we find diversification is one of the keys to success. While traditional assets like stocks and bonds have long dominated portfolios, alternative investments have gained more popularity in recent years. Whisky, a well-loved spirit with a rich history, has emerged as a unique investment avenue in the past decade.

A tangible, consumable asset, that’s also culturally significant, Scotch whisky offers numerous benefits that can make it an potentially enticing option for investors. In this article, we delve into the benefits that come with whisky investment, ranging from portfolio diversificationthrough to the supply and demand nature of the market. At Hackstons, transparency and authenticity are among our core values, and so we also share some of the key risks to consider as well as some ways to mitigate these risks.

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As with any asset ownership market, and in fact many markets outside of asset ownership, whisky is not immune to fraudulent activities. Unfortunately, in any market, unscrupulous individuals may attempt to sell counterfeit or non-existent bottles or casks, exploiting the enthusiasm and trust of potential investors. As such, it is essential to exercise caution when dealing with unfamiliar sellers or investment opportunities.

When looking for companies that can facilitate whisky ownership, we recommend being as thorough as possible with your due diligence so that you can be confident that you’re working with a trusted and established company, helping to mitigate the risk of falling victim to scams.

Value of cask/whisky diminishing

While the whisky market has shown growth, it is essential to recognise that the value or returns of each whisky cask is never guaranteed. Factors such as brand reputation, rarity, age, the type of finish and demand all influence the potential for value appreciation. Economic conditions and changing consumer preferences can also impact the market dynamics, leading to fluctuations in whisky values. With this being said, as a general rule of thumb, whisky which is held for long periods of time, that also does not fall below a minimum ABV of 40%, will always have a value and in our experience, we tend to find that this is typically more than what was originally paid.

It is always worth carrying out thorough research and asking the right questions of any advisors that you speak with, which will mean that you will have a better understanding of which cask suits your whisky ownership ambitions. 

Damage or theft

Physical assets, such as whisky casks or bottles, are of course more susceptible to damage or theft than more nebulous assets such as stocks and shares. Fire, water damage, or improper storage conditions can lead to a significant loss of investment value. Additionally, theft poses a risk, as rare and valuable whiskies can be attractive targets for criminals.

While all whisky casks need to be stored in a HMRC-bonded warehouse, the insurance for these facilities usually only protects the structure of the building itself, and not its contents. As such, If you’re looking to own whisky, you should ensure proper insurance coverage for your casks. At Hackstons, We offer an extensive and bespoke insurance policy to all our cask owners. Our policy covers fire, theft and damage and your cask is insured to its current value, rather than the purchase price, providing you with top of the range capital security.

Note: It should be noted that there are additional costs for storage and insurance, but you can discuss these costs with your Account Manager.

Whisky ABV dropping below the accepted standard

Whisky ageing involves the evaporation of alcohol known as the "angel's share." Over time, the ABV (alcohol by volume) of the spirit can drop below the required minimum for classification as whisky. While some degree of ABV reduction is expected (around 2% each year) and contributes to the complexity of aged whisky, excessive evaporation can diminish the product's quality and value.

Once Scotch drops below 40% ABV, it is no longer considered Scotch whisky, and so you should stay informed about the ABV levels of your cask to ensure that it doesn’t drop below 40% ABV. We recommend checking the ABV level of your cask every 3-5 years for younger casks, and every 2-3 years for casks that are older. This is known as regauging your cask, and is a service that clients can request from us at Hackstons.

Note: Once again, it should be noted that there are additional fees for reguaging, but these can be discussed with an Account Manager, who will also keep you abreast of when you should regauge your cask.

Please Note: The whisky investment industry is unregulated, and as with all investments, the value can go up and down. There are risks to consider and disclaimers about how we trade that you should know about before investing in cask whisky. You can find these risks and disclaimer on our risks page here.

Having covered the potential risks to consider around whisky ownership, let’s now delve into the multiple benefits that come with owning a tangible, liquid asset such as whisky.

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Portfolio diversification

In a time where stocks, shares and crypto offer perhaps more unpredictable routes to investment, you may want to consider diversifying your portfolio. Owning whisky offers one such avenue. Tangible assets such as whisky, offer a different route to investing, and operate independently from the stock market, often making it an attractive alternative investment for individuals. 

By allocating a portion of your investment portfolio to whisky, you can potentially reduce the risk associated with stock market volatility. The low correlation between whisky and other asset classes means that it has the potential to act as a potential hedge against rising inflation and lagging interest rates.


Limited production runs, rarity of aged single malt casks, and growing demand all contribute to the potential value of premium whiskies. Moreover, the nature of Scotch whisky is that over time it matures, and in turn, we find it can increase in value. 

While it’s never possible to predict exactly what particular bottles and casks will be worth, it only takes a brief search to find a number of examples of whisky casks reaching lofty heights in terms of returns. The ‘forgotten’ Macallan cask, bought for £5000 in 1988 which sold for $1.3m dollars last year is perhaps one of the most impressive examples of this. While this is not typical for many new owners entering the market, and isn't commonplace, this is just one example of what can happen when you allow a cask to become rare.

Note: As with all investments, the value can go up and down, and no returns are guaranteed.


Another advantage of buying casks of whisky is its potential for tax-efficiency. In many countries, including Scotland, whisky is considered a wasting asset. As per the HMRC definition this is ‘an asset with a predictable life of over 50 years’. When whisky is stored in oak barrels there is always evaporation known as ‘The Angels share’, which accounts for around 2% of the entire whisky cask volume each year due to the oak cask and environment in which the barrels are stored. For this reason, for UK tax purposes the whisky in the casks is considered to have a life of under 50 years and therefore is exempt from Capital Gains Tax under the wasting asset rules.

Note: It is worth noting that if you bottle your whisky you will need to pay duty and VAT on the bottles.

Tangible and consumable 

Investing in whisky offers the unique advantage of owning a tangible and consumable asset. Unlike stocks, shares or bonds that exist only on paper, and are much more nebulous in nature, whisky is a physical item that much like your own home can be held and admired. When you purchase a whisky cask, you own the title, it is held in a HMRC-bonded warehouse, and in some cases you can even go and visit your cask at the distillery. Once casks are bottled, each bottle represents the craftsmanship of skilled distillers using age-old techniques, and whisky enthusiasts take great pleasure in collecting and tasting these different expressions.

Furthermore, even if the market fluctuates, the inherent value of whisky tends to remain intact, as it can always be consumed and appreciated. This dual nature of whisky as an investment and a consumable luxury makes it an appealing choice for those who derive joy from both collecting and savouring the spirit.


Another unique aspect of whisky lies in the maturation process. As we briefly touched on earlier, unlike other traditional investments and tangible assets, whisky matures over time, typically enhancing its quality and, in some cases, its value. As whisky ages in oak casks, it undergoes a transformation, in which it acquires new, complex flavours and aromas that appeal to connoisseurs and collectors alike.

This maturation process adds an extra dimension of scarcity, as each bottle effectively becomes a time capsule capturing the essence of its distillery and production year. Unlike other liquid assets such as wine, whisky stops maturing once bottled so collectors and drinkers alike will not have to anticipate or guess what the whisky will taste like if the bottle is not opened and consumed immediately. Investors can leverage this aspect to their advantage, benefitting from the increased desirability and, in some cases, value of well-aged whiskies. 


When considering whisky investment, the concept of provenance plays a significant role. 

Provenance essentially refers to the traceability and authenticity of a bottle, including its distillery, production methods, and age. Whiskies with strong provenance, such as limited editions from renowned distilleries, or even ghost distilleries (those that no longer are in operation) can command higher prices in the market.

By purchasing whiskies with exceptional provenance, investors can capitalise on the prestige and reputation of specific distilleries, attracting future buyers who value the historical and cultural significance associated with these bottles. Provenance often adds an extra layer of desirability to both whisky investment and collecting.

Growing global demand

It is no secret that Scotch whisky continues to enjoy a growing global demand, fuelled by a rise of enthusiasts and collectors worldwide. You only need to look at the most recent export figures from the Scotch Whisky Association (SWA) to get a picture of just how much this demand is growing. Emerging markets across the Asia-Pacific region, as well as India - who topped 2022’s list for the amount of bottles of Scotch whisky exported to the country - have developed a strong appetite for premium whiskies, contributing significantly to the surge in demand.

An expanding middle class in these regions, coupled with a newfound appreciation for luxury goods, has led to a flourishing whisky culture. This growing global demand provides a favourable market environment for whisky owners, and the market for people holding casks is incredibly small in comparison to those that drink whisky globally, so we believe the secondary market will naturally grow.

Note: The growth of the whisky market refers to the bottles consumed. The fact that whisky casks need to be matured for 3 years to be considered Scotch, means that there are only a finite supply of casks to cater this demand, which has the potential to increase the demand, and in some cases, the value of certain casks.

Decreasing supply

At its core, whisky investment benefits from a fundamental supply-demand dynamic. As the demand for premium Scotch whiskies continues to rise globally, the industry faces a challenge in meeting this demand due to limited production capabilities. There is a finite number of casks, and due to the nature of Scotch whisky requiring at least three years of maturation, and the lengthy distillation process, producing high quality casks doesn’t happen overnight and accessing the casks that have growth potential is not easy.

In addition, changing consumer preferences and increasing costs of production contribute to the decreasing supply of aged and rare whiskies. This scarcity of supply has the potential to put upward pressure on prices, presenting an opportunity for investors to capitalise on the potential rising value of limited-edition, discontinued and scarce Scotch whiskies.

So there you have it, the key benefits of investing in whisky. Whether you are a seasoned investor or a whisky enthusiast looking to diversify both your passion and portfolio, exploring the world of Scotch whisky investment can be a rewarding endeavour, offering a captivating journey that intertwines history and craftsmanship.

PLEASE NOTE: The whisky investment industry is unregulated, and as with all investments, the value of your investment can go up and down. Please note, there are risks to consider when investing in cask whisky, you can find more information around other risks relating to whisky cask investment, as well as an outline of some of our key terms of business with you, here.

If this article has piqued your interest in purchasing your own cask or you just want to find out a little more about it, just complete the form below to get in touch with one of our Account Managers today! 

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What our clients say

The whisky investment industry is unregulated, and as with all investments, the value of your investment can go up and down. Please note, there are risks to consider when investing in cask whisky, you can find more information around other risks relating to whisky cask investment, as well as an outline of some of our key terms of business with you, here.