Passion investing: Rare Whiskey Bottles beat luxury cars and watches with 373% price jump in 10 years

Rare Whiskey Bottles continued to be the 10-year leader of Knight Frank Luxury Investment Index with a good margin of over 373% jump in price.

Passion investing
Read details of recent Knight Frank Wealth Reprot 2023. Representational image

Even as rising interest rates and inflation have been affecting investment decisions across the world since last year, there seems to be no slowdown in passion investing. The results of the recent Knight Frank Luxury Investment Index (KFLII) show that investments of passion are still riding high despite economic worries.

The index, which tracks the value of 10 investments of passion, rose by 16% in 2022, comfortably beating inflation and outperforming mainstream investment classes like equities and gold.

Rare Whiskey Bottles continued to be the 10-year leader of the index with a good margin of over 373% jump in price. The Macallan The Reach, 81-year-old single malt whiskey, was the highest-selling example of this asset class in 2022. However, as a passion investing asset class, Rare Whiskey Bottles lost some ground in 2022 with only a 3% increase in price during the year.

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The Knight Frank Wealth Report 2023 quoted data guru Andy Simpson as saying that the market for bottles valued at over £5,000 has definitely weakened. “As prices, rose speculators came into the market just looking to flip bottles, which was ultimately unsustainable,” Andy said.

Top performers

Art was the top performer on the index with a 29% change in price in 2022. The top-selling art piece was Andy Warhol, Shot Sage Blue Marilyn, 1964, with a price tag of $195 million.

Art was closely followed by cars (25%), watches (18%), handbags (15%), and coins (8%). In the last 10 years, cars, watches, handbags and coins have seen a price change of 185%, 147%, 74% and 59% respectively.

According to the report, the current price of “The Macallan The Reach” 81-year-old single-malt whiskey is around $300,000 (approx Rs 2.45 crore as per dollar to the rupee exchange rate on March 5).

Source: Knight Frank Wealth Report 2023

The report quoted Sebastian Duthy of Art Market Research, as saying that the performance of art as an asset class was driven by the stellar prices paid for museum-quality works of art by ultra-wealthy collectors.

“Several single-owner collections, including works owned by Microsoft founder Paul Allen and American investor Anne Bass produced totals in excess of US$2.5 billion, more than doubling collection sales in 2021. With the provenance of a high-profile collector attached, blue-chip works routinely break auction records and last year was no exception with five achieving over US$100 million,” said Sebastian.

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12% UHNIs in India to invest in Rare Whiskey Bottles

Approximately 29% of Ultra High Net Worth Individuals (UHNWIs) in India are likely to make their passion investments in wine while 12% are expected to invest in rare whiskey in 2023, according to the report. Globally, wine and rare whiskey are expected to be pursued by 39% and 18% of UHNI passion investors in 2023.

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First published on: 05-03-2023 at 18:44 IST
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