Demonstrating that whisky is indeed a liquid alternative to traditional investment strategies, a British man recently declared that he is retiring early after capitalizing on an outlay made 27 years ago.
Roger Parfitt, a British banker manager, made the decision to purchase two casks of Scotch whisky back in 1994. One barrel of The Macallan was acquired for £3,200 (approximately $5,000 at the time) and a cask of Tobermory for £1,500 ($2,340).
As reported by Luxurious magazine, Parfitt has now entered into a sales agreement for the whisky. Fetching £225,000 ($312,500), the sale represents a nearly 4,700 percent return on his original investment.
The costs of storage and insurance were not reported and undoubtedly reduced the profit margins, but the returns are impressive, nonetheless.
Parfitt told the publication that he was never concerned about the value of the play, as he could always throw a party with the precious spirits if they failed to appreciate in value. “It always had that fallback for me,” he said. “[Y]ou could drown your sorrows if it didn’t work out financially.”
Investing in whisky to diversify portfolios has proven to be a successful strategy. The asset class has consistently outperformed the S&P, and the Knight Frank Wealth Report from 2020 reports a 564 percent appreciation in whisky values over the prior decade.
Adding to the allure of the investment scheme, Parfitt did not incur any tax liabilities with the sale, as whisky is classified as a wasting asset (because evaporation and spoilage occur) in the UK, and all profits are realized tax-free. Perhaps as the start of a new tradition, he intends to purchase casks for each of his children in the hopes that they will have similar opportunities in the future.
As a result of the windfall, Parfitt is paying off his mortgage and retiring three years earlier than planned. He now has more time for golfing and fishing with friends, and he’s planning a family vacation to Florida. Presumably, the adventure will be celebrated with something old, malt-based, and incredibly valuable in hand.
