Building whisky portfolios: Why bourbon could be the next big alternative investment
CaskX CEO Jeremy Kasler explains what investors need to know about how to build a whisky portfolio.
a lot of viewers, they they might hear bourbon investing and they might think, okay, you know, bottles of bourbon. That is not what we’re talking about. So, maybe just explain a bit at a high level, Jeremy, the mission, the purpose, the investment idea.
Cool. Thanks for having me, first of all. Um yes, so we allow uh our investors to invest in barrels of bourbon. Uh so we’ll go out, we’ll uh do deals with distilleries in Kentucky and Tennessee mainly. Uh we’ll go and procure for example say a thousand barrels of uh new-make bourbon, which means it’s literally just been filled and we’ll sell those barrels in smaller quantities to investors uh throughout the US and and globally as well. Uh we include uh eight years of storage, insurance and taxes, etcetera, etcetera. So when the client invests, uh they they pay their their sum, they pay their fee and then they pay nothing else for up to eight years and of course, as you’re I’m sure you’re aware as uh as whiskey and bourbon ages, improves in flavor, uh and therefore increases in value.
And Jeremy, why bourbon specifically, rather than, you know, I don’t know, Scotch or rum or tequila.
Good good question. Well, actually fact, we do sell Scotch for investment as well. Uh, and we recently launched a Tequila investment business. So, it’s we we look at the uh spirits assets that will improve with flavor uh over a period of time. Uh Now, for example, it it wouldn’t make sense for vodka because vodka, you know, they produce it today, it goes into the bottle tomorrow. But with uh with Scotch for example or Bourbon, you can age it for decades and if it’s aged correctly and it has good uh provenance, as they say, a good history and is stored well, then it should uh almost certainly increase in in flavor and quality and and therefore value.
What kind of return, Jeremy, should an investor expect here?
Well, I think historically, the the figure we we’ve seen since 2010 is 13.85% per annum. Now, it’s, you know, it’s one of the few assets that if market conditions stay exactly the same, the the the value will increase because as I said, when it goes into the barrel, it’s just a white spirit. It’s it’s kind of almost undrinkable. But over a period of time, every day, it gets slowly better and better. So, this is why we look at eight years of storage and insurance because after eight years, we almost certainly see an increase in value.
