Investing in whisky - maybe a scam?

[ScumOfTheRoad]

I got a cold call from the Whisky Hub yesterday. Asking if I wanted a call back from an investment consultant in whisky. I said yes.
Alarm bells rang when they quoted my email address from a company I worked for 10 years ago.
I quite like the idea of investing in a share of a barrel of whisky, and I do know this is possible.
However am I right to be suspicious here?

[mrcharly-YHT]

Always be suspicious.

[PaulF]

I’d not put anything with them I wasn’t prepared to lose. Had a quick look at their website; firstly they don’t seem to be regulated, secondly their statement about their investment strategy statement seems boilerplate and not tailored to whisky but more generic.

At best proceed with caution.

[Snakehips]

How do you get your money (profit?) out? Who decides when to cash in? Are there ongoing charges like storage charge and insurance. I'm sure these would eat in to any profit.

[PaulF]

I’m sure the business model is geared around the storage/admin charges plus a fee when you buy or sell. Won’t make much difference to them what happens to prices in the interim.

Exactly the same model as the companies who look after the shares in our pension schemes; except those companies are regulated so if they go under you don’t lose your assets.

[jwo]

Cold calling about an investment opportunity - Red flag
Bulk whisky as an investment - Red flag
Unregulated investment firm - Red flag.

Stitching the fabric together makes a big red flag.

[Jurek]

^
In a nutshell.

[Beardy]

Personally I’d not invest in any company or business that cold called me. Any ‘investment opportunity’ that needed to use aggressive marketing to hunt for investors is not one I would touch with YOUR barge pole.

[Asterix, the former Gaul.]

Elder brother has invested in whisky in the past. Some sort of club where they get together to buy a barrel.

He was then living near Glasgow and it was all personal contact, visit distilleries, get to taste whisky.  The idea was to get really nice whisky cheap rather than make money. I have drunk some of it and it is really excellent stuff.

Any other sort of arrangement I'd run a mile.

[Polar Bear]

I have been researching bottled whisky with a view to investment partly for fun, partly because I do like a wee dram.

I'm not brave enough to go for barrels.

[Ian H]

It's a volatile investment in the most literal sense.

[Wowbagger]

As a matter of course I don't deal with cold callers.

Mostly I just put the phone down but recently, when someone has said something like "I'm one of the energy consultants for your area..." I interrupt and say "What's the postcode?". They have no idea.

Just liars I'm afraid.

[Pingu]

Whisky ingestments can come back up as well as go down.

[ElyDave]

I looked into it when a new distillery I was interested in opened, there were a lot of hidden charges, plus eventually excise duty when you bottle. As said upthread it was overall a good way to get a good whisky cheaper than it might be in the future, but I couldnt see that I would have made a fortune unless it became a very desirable dram.

[Ian H]

I looked into it when a new distillery I was interested in opened, there were a lot of hidden charges, plus eventually excise duty when you bottle. As said upthread it was overall a good way to get a good whisky cheaper than it might be in the future, but I couldnt see that I would have made a fortune unless it became a very desirable dram.

A small cider & wine maker down here said it was a game-changer when they were allowed to install a bonded warehouse - it meant they didn't have to pay VAT until bottling and sale.  Previously they had to pay on production, and evaporation meant they paid for more than they sold.

[Arminius]

I don't think I would do it if you're looking to make money out of it, particularly in the short to medium term. The whisky market has really slowed over the past year, from what I've seen (new releases not selling out, when they would have gone almost immediately before, much lower auction prices, etc), and there are loads of new distilleries out there that are all fighting for a share of a smaller pie. Also, my brother (who is much more into this than me) pointed out a post from a whisky broker last year saying they're seeing loads more people/small businesses trying to sell all of their stock, which doesnt bode well for prices.

If you're thinking about buying a (part share in a) cask for future bottling and drinking, that's a different matter, though I wouldn't do it myself - I don't think I could ever like a particular whisky enough to want a couple of hundred bottles of it! I have come close a couple of times, but that was more because I would have liked to support the distillery itself.

Please note that this does not constitute financial advice! 

[Jaded]

I have a bottle of malt that is worth about £600 if someone wants to buy it. If not, it won’t get drunk as it has sentimental value and isn’t remarkable. It is one of the last bottles of the malt, as the distillery is no more. I bought it quite  a few years ago as the distillery was distant-family owned.

So, to be successful in whisky investing, buy bottles of malt from demolished distilleries and wait half a century.

[Kim]

Invest in Bromptons instead.  At least that way you know what you're getting and you've got a useful n+1 if the market value collapses.

[mrcharly-YHT]

Invest in Bromptons instead.  At least that way you know what you're getting and you've got a useful n+1 if the market value collapses.

Plus a handy getaway vehicle for the zombie apocalypse

[ElyDave]

I have a bottle of malt that is worth about £600 if someone wants to buy it. If not, it won’t get drunk as it has sentimental value and isn’t remarkable. It is one of the last bottles of the malt, as the distillery is no more. I bought it quite  a few years ago as the distillery was distant-family owned.

So, to be successful in whisky investing, buy bottles of malt from demolished distilleries and wait half a century.

I have one like that, same age as me from my favourite distillery.  I'm sure it's a great bottle, but I somehow can't bring myself to open it knowing what it's worth.

[Wowbagger]

Clearly you need to sell it and buy a Brompton.

[Mr Larrington]

I have a miniature of Hennessey cognac, a freebie from doing the distillery tour in 1982.  Wonder if it’s worth anything

[chrisbainbridge]

I think the food program on radio 4 covered this last year. I certainly heard a radio 4 program about the subject. Basically 99% of these are scams. Unless you own the whole barrel you cannot get your share until everyone agrees for example.

[Regulator]

I have a bottle of malt that is worth about £600 if someone wants to buy it. If not, it won’t get drunk as it has sentimental value and isn’t remarkable. It is one of the last bottles of the malt, as the distillery is no more. I bought it quite  a few years ago as the distillery was distant-family owned.

So, to be successful in whisky investing, buy bottles of malt from demolished distilleries and wait half a century.

I have one like that, same age as me from my favourite distillery.  I'm sure it's a great bottle, but I somehow can't bring myself to open it knowing what it's worth.

Mine’s a bottle of gin.   Limited run, made for the graduation of my nephew’s cohort of apprentice masons.