Rare whiskey, wine, luxury handbags: You could have made a fortune in these

An investment in a luxury rare whiskey 10 years ago and you would have made a fortune. According to Knight Frank Wealth Report 2020, an investment in a rare whiskey in 2010 would have fetched a huge return of 564 per cent in a 10-year period, followed by cars, art and wine, which moved up by 194 per cent, 141 per cent and 120 per cent, respectively during this period.

However, the annual change for 2019 reveals a different picture. Debuting as a luxury investment asset, collectable handbags rose 13 per cent in value in 2019, outperforming other major categories including arts, cars, rare whisky, jewelry, and stamps, the Knight Frank Luxury Investment Index (KFLII) suggests. For KFLII, Knight Frank focused specifically on collectable handbags made by Hermès.

And investment preferences are changing over time. As with other investments of passion like rare whisky, whose value has risen sharply in recent years, handbags, according to Andrew Shirley, Editor, Wealth Report 2020 and the Knight Frank Luxury Investment Index, are increasingly being seen as an investment class in their own right, as well as highly desirable fashion accessories.

“Collectors are prepared to spend hundreds of thousands of dollars on the rarest or most desirable bags,” he says.

Rare whiskey, which was the best performer in 2018, fell to the third place with an annual price increase of 5 per cent, following stamps with a 6 per cent rise in value, the survey findings suggest.

“It’s only been possible to create an index on handbags now because of the frequency with which many iconic pieces are coming to auction today. Although bags made by other luxury brands like Chanel and Louis Vuitton are also highly collectable, it is those made by Hermès that attract the highest prices and are considered the most desirable,” said Sebastian Duthy, Director, Art Market Research, Knight Frank.

Here’s one for the road!

Knight Frank Luxury Investment Index (to Q4 2019)

Luxury Asset	Annual % change	10-year change
Rare whiskey	5%	564%
Cars	-7%	194%
Art	5%	141%
KFLII	-1%	141%
Wine	1%	120%
Handbags	13%	108%
Jewellery	-7%	90%
Coloured Diamonds	-1%	86%
Stamps*	6%	64%
Watches	2%	60%
Furniture	0%	-27%

*All data to Q4-2019 except stamps (Q4-2018)

Source: Knight Frank study