Whisky fund launched in Hong Kong to meet growing demand by collectors

Fine wines have long been articulated as investments by connoiseurs, however a new alcoholic drink is set to rival even the most expensive wines.
Whisky is now the next new investments in Asia with growing demand for single malt whisky in the 30 to 50-year age range, while its supply has been decreasing in recent years, thereby pushing its prices.
Murray Holdgate, Director at Rare Finds Worldwide, a Hong Kong-based whisky brokerage, has recently announced the launch of its Rare Single Malts fund that will begin capital raising in Hong Kong.
The plan to establish the private 5-year fund was hatched after seeing strong demand for its brokerage services, Holdgate said. The fund will take advantage of undervalued casks, collections and bottles with a buy-to-hold strategy. It is looking to invest £20 million (US$25.3 million).
Holdgate said, “We believe whisky is liquid gold and rare whisky equals rare returns.”
The fund will be targeted at professional investors including Asia-based family offices and high-net-worth investors, with the first close due at the end of July 2020. The fund boasts investors that are avid collectors and general whisky lovers from Hong Kong, Singapore, Malaysia and Europe. In addition, the fund is also attracting investors that do not consume alcohol. This group of investors instead see the investment potential of the asset.
It makes one to wonder whether the timing of the launch of the whisky fund is appropriate especially during the current pandemic period, when many countries are burdened by high infection rates and high unemployment.
The whisky fund however will focus on casks instead of physical bottles, a key differentiator to other portfolios in the market. Despite the global pandemic, Holdgate remains bullish on the demand in the niche market. “The Scotch whisky market, which has always been self-sufficient and in high-demand, is being boosted further by growing Asia demand. We see no signs of this demand abating any time soon,” he concluded.
By 2019, Scotch whisky total export reached £4.9 billion (US$6.2 billion), according to UK customs department (HMRC). In 2019, a bottle of 60 year old Macallan 1926 Scotch whisky set a new world record after fetching US$1.9 million at an auction.