- Frequently Asked Questions
- FAQs : Why WhiskyInvestDirect?
- FAQs : Safety
- FAQs : Storage
- FAQs : Operational
- FAQs : About Us
- FAQs : Governance
- FAQs : Robots
- How to do it
- Fund my account
- View our tariff
- Buy whisky
- Validate my account
- Submit a document
- Sell my whisky
- Withdraw funds
- Use the order panel
- Monitor my orders
- Cancelling my order
- Modify account settings
- Modify my limit price
- See my trading history
- Prove my money is safe
- Cask lists and client bank statement
- Understand my statement
- In case of death
- Close my account
- Contact WhiskyInvestDirect
- Make a complaint
- Whitelist our emails
- Become a referrer
- Getting started & buying my first whisky
- How do I fund my account?
- How do I buy whisky on WhiskyInvestDirect's markets?
- What if I make a mistake?
- How do I verify my identity?
- Why can I not use my credit/debit card on-line?
- Can I get physical custody of my whisky?
- Where does WhiskyInvestDirect whisky come from?
- Is it always WhiskyInvestDirect with whom I trade?
- What is the 'spread'?
- What decides the size of the spread?
- Am I dependent on WhiskyInvestDirect quoting prices?
- Might no-one be bidding a fair price for my whisky when I want to sell?
- How am I paid when I sell?
- Is interest paid on money held in the pooled segregated client account?
- Can I buy now and pay later?
- Can I deposit cash?
- Can I use my whisky as collateral?
- What is the minimum purchase/trade size?
How do I get started?
There are three steps to owning whisky in WhiskyInvestDirect. Most people can complete the process in about 15 minutes of their own time.
- Open your account (4 minutes)
- Fund it (10 minutes instructing your bank to transfer money, then a wait while they do it)
- Buy your whisky (1 minute)
Just go to our getting started procedure and follow it through.
How do I fund my account?
You must first open your account at WhiskyInvestDirect.
Then follow the details described here to send your money.
You will be probably be sending a significant sum. What happens to your money? How is it kept safe?
Your money will go to one of WhiskyInvestDirect's client bank accounts with Wells Fargo or Lloyds Bank.
If your WhiskyInvestDirect account currency is set to British Pounds (£) and you bank within the UK you can send funds to Lloyds Bank via BACS or Faster Payments (usually free — typically used for smaller, non-urgent payments) or CHAPS (usually with a charge — used for larger or more urgent payments). Generally speaking the sensible threshold for switching to a CHAPS as opposed to a BACS payment is somewhere between £10,000 and £20,000, but you should choose for yourself, depending on the urgency with which you want to buy whisky.
If your WhiskyInvestDirect account currency is set to US Dollars ($) and you bank within the US you can send funds to Wells Fargo via three domestic bank clearing systems:
- Wire transfer — the fastest and most secure method, using the Federal Reserve's FedWire system. The sending bank will typically impose a charge to send funds by wire.
- Electronic bill payment — a common feature of online banking (sometimes called BillPay). This service is available from all US banks, and is usually free or with a small nominal fee on the order of $0.50. This method of payment is typically slower than a wire, but can depend on how it is processed by the sending bank.
- Check — free, but much slower than other methods available to you.
From other countries, or if you want to send a different currency, you can send SWIFT transfers electronically through the global SWIFT network, which has grown over 30 years to be easily the largest, most trusted and most reliable means of international bank to bank payment. Your money's successful transfer is fully guaranteed by SWIFT's participating banks.
After your money is received by the bank it will be credited by them into our account, as named and numbered on the payment instruction generated for you on the WhiskyInvestDirect site. We in turn are advised of the receipt of your money and the quoted reference — your WhiskyInvestDirect username — which was on the instruction. We then credit your account at WhiskyInvestDirect with your money, and your funds are guaranteed — so there is no clearance delay.
Within hours you will be able to buy your whisky.
Like all western banks operating within modern money laundering regulations Lloyds Bank is responsible to the banking community for verifying the legal identity of those who seek to bank with them. They have verified both the legal identity of the corporate entity in charge of WhiskyInvestDirect and the individuals with responsibility for managing the accounts.
The banks look after WhiskyInvestDirect's customers' money in these accounts. WhiskyInvestDirect's company accounts are kept separate from customers' money.
Client money is managed by WhiskyInvestDirect strictly according to the Terms of Business agreed between WhiskyInvestDirect and you, which limits the uses to which money in that client account can be put. Lloyds Bank and you have been fully informed of these Terms of Business.
How do I buy whisky on WhiskyInvestDirect's markets?
Once you have opened your account and funded it you are ready to buy whisky. You can manage the buying and selling of whisky on WhiskyInvestDirect’s order board.
There are many points within the WhiskyInvestDirect system from which a few mouse clicks create an order on the market order board for you.
There are several possible procedures.
Click here for an explanation of how to beat the best buying price - in which your patience and willingness to offer the best price to a seller might be rewarded with cheaper whisky.Monitoring an active order
There are several ways to monitor your order. The main one is explained here.
A good alternate way to monitor unexecuted orders is from the order board, where you can see your bid in context with everyone else's.Explanation of what happens to your confirmed order
Your order details are transmitted to the WhiskyInvestDirect order board. The instructions are processed in the strict sequence in which they are received. So, If your order can be executed in full you will buy whisky there and then. We call this matching.
If not your order will probably be posted on the order board.
For each matched execution you will receive both
- interactive modifications to your own private orders history screen.
- email advices of the amount you have traded.
For order board trades, settlement occurs instantaneously upon deal execution which is possible because WhiskyInvestDirect retains control over the resources of both sides settling a whisky trade.
Because settlement is instantaneous you can sell immediately after buying.
NB While you have unexecuted open orders your account balance remains the full sum of your money, but money required to honour the settlement of your open orders - should they execute - is not available to other orders you may wish to post. The amounts you need to settle your orders are in your reserved balances.
What if I make a mistake?
It can be daunting getting to know a new e-business system where it may seem an incautious click could cost you a fortune. So let's take some of the worry out of it.
The only result of you spending money is buying whisky at a fair market price.
System protections ensure you can do this safely even while you are unfamiliar with the system.
- You can only spend money you have in the system. You cannot accidentally overspend your cash balance and be asked to send in more.
- You cannot accidentally sell whisky you do not have. The system will reject your order.
- You cannot accidentally issue us with instructions to pay the wrong person. We don't accept those instructions because we always pay funds to the account which sent us in money in the first place (i.e. yours).
- You cannot be hurt by an accidental typing error which enters an order at an obviously silly price. The system rejects orders too far away from the current price.
- You will never receive a margin request - i.e. a demand for additional money from us to cover the risks in your trading position. No such payment will ever be required, because there is no credit in the WhiskyInvestDirect system.
- When you do put in an order you will see feedback with a request to confirm. You will be able to read a simple explanation of what the system is going to do for you, and you will have the chance to reject or accept it before it commits you.
How do I verify my identity?
To verify your identify you have to choose from a variety of options explained in our identity verification procedure.
Why can I not use my credit/debit card on-line?
WhiskyInvestDirect avoids credit in any form. A purchase of whisky within WhiskyInvestDirect's rules absolutely requires your cleared funds in the WhiskyInvestDirect Client A/C.
Credit and debit card operators guarantee to provide funds in due course, but they hold on to the money and earn interest from it, sometimes for as long as 30 days. During this period merchants only have their guarantee of payment. WhiskyInvestDirect does not accept guarantees of payment, because they expose whisky sellers to default.
With commissions up to 2% credit/debit cards are much better suited to retail shopping than whisky purchases. Retailers sell goods on high margins from which a payment services providers share of 2% is considered acceptably small. WhiskyInvestDirect provides customers with access to trade whisky on low margins. Most of our customers recognise that the small inconvenience of arranging a SWIFT transfer saves a worthwhile capital sum.
Can I get physical custody of my whisky?
Yes, all users have a right of withdrawal. But there are good reasons to leave your property inside the bonded warehouse - where it could not be physically safer - pending exceptional economic or financial circumstances.
Holding your whisky inside bonded warehouses in barrel means it retain maximum resale value. Because there is no physical movement when you deal, there are no shipping fees. Transaction costs are further reduced because if your whisky remains in bond you don't pay any manufacturing costs, duty or VAT. Nor do you suffer the hassle, risks or costs of trying to care for your whisky yourself outside these bonded facilities.
In addition to these strategic reasons for avoiding personal custody of whisky, there are tactical ones:-
- It is highly unlikely privately held whisky will ever be bought back by the professional whisky market, and loses value proportionately.
- Privately held whisky is physically less safe than warehoused whisky, and very much more expensive to insure.
Using WhiskyInvestDirect overcomes these problems. It is very efficient for those people who want whisky for financial and safety reasons. Taking possession of whisky is, of course, possible. (See the charges.) Spirit can be removed before it reaches three years old, but it cannot be bottled as Scotch whisky as the legal minimum age for Scotch whisky is three years old. It must be labelled as 'spirit'.
All bottling will be done by WhiskyInvestDirect or an appointed agent. All whisky will be bottled under the WhiskyInvestDirect brand name with a small degree of label personalisation permitted. This will include details of the owner and a description of the product. We will follow the strict labelling rules and regulations for Scotch whisky as determined by the Scotch Whisky Association.
Where does WhiskyInvestDirect whisky come from?
WhiskyInvestDirect buys whisky up front with our own money from both large corporate and small independent distillers at the then dealing price. The whisky is already in the distiller’s bonded warehouse when we buy it.
Once purchased by us this whisky forms part of our official whisky inventory.
We add the delivered whisky, measured in Litres of Pure Alcohol (LPA) to our own trading account in our WhiskyInvestDirect property records. Once it is in our inventory we can sell it to whisky buyers via the order board.
Along with all other WhiskyInvestDirect users we can offer it for sale on the WhiskyInvestDirect exchange. Quite often we offer the cheapest whisky, and when customers buy our whisky the net effect is an inflow of whisky into private hands in the WhiskyInvestDirect marketplace.
Whether or not customers compete in offering whisky prices is entirely a matter for them, but it is important that they can. Anyone who wants to sell (which could include you as soon as you have bought) can offer new buyers a price slightly cheaper than ours. Then rather than buying whisky from us customers will be buying it from another customer who happens to offer the cheapest whisky.
It is this dynamism in an open market which produces highly competitive pricing for all participants.
As with any other WhiskyInvestDirect transaction, the resources used to initiate an order will be reserved, but will not be deducted from your account until settlement is complete.
Is it always WhiskyInvestDirect with whom I trade?
No. You only trade with WhiskyInvestDirect if we were first to post the price which is better for you than any other WhiskyInvestDirect seller - who might be another individual such as yourself making use of the order board to get the best possible price when he wants to sell.
WhiskyInvestDirect gets no trading priority over other participants. In fact if you choose to offer the best price, and we subsequently match your price on the order board, then you get priority over us, because you were there first. This is the same for all participants and is true both for buying and selling.
If we run out of a particular type of whisky, then - just like any other Customer - we are prevented by the system from selling what we don’t own. But we are only one potential seller of whisky. Whether we are selling or not, other willing sellers will be setting prices for buyers too. Only if we are able to purchase from willing sellers on the platform or possibly purchase more from the distiller, can we sell that particular whisky on the platform again.
Moreover when we run out of whisky inventory - in times of heavy demand - there might be a tendency for the offer price to be slightly higher than is reflected in professional whisky markets. Obviously this is an opportunity for those who own whisky to sell it at an attractive price.
At absolutely no time can any WhiskyInvestDirect customer - including our own trading arm - sell whisky which is not already held securely in the bonded warehouse and owned outright by the customer.
What is the 'spread'?
Lots of people quote prices on the WhiskyInvestDirect order board. The spread is the difference between the bid and offer prices, i.e. the difference between the price at which whisky can be immediately sold and the price at which it can be immediately bought.
What decides the size of the spread?
Market conditions decide the size of the spread. If the market is very quiet active traders can make profits on narrow spreads, because in the time between buying and selling whisky the price is unlikely to have moved out of their profit range. Conversely, if the market is very volatile the risk of owning whisky for the period between buying and selling with different Customers increases. Then traders need to increase their spreads.
Am I dependent on WhiskyInvestDirect quoting prices?
No. Any customer's limit orders will appear on the WhiskyInvestDirect order board. In the absence of WhiskyInvestDirect quoting prices other users will be happily competing to offer you prices too. They do this (and you can too) regardless of whether WhiskyInvestDirect itself is able and willing to trade.
Might no-one be bidding a fair price for my whisky when I want to sell?
This could happen. It's unlikely, because traders would usually fill the void by bidding so as to be able to sell at a profit to the next buyers.
How am I paid when I sell?
On matching a sale order on the WhiskyInvestDirect order board your WhiskyInvestDirect account is immediately credited with cleared funds. At the same instant the buyer is debited. The buyer's money was held in the pooled segregated bank account prior to the purchase, and at the instant of trade the entitlement to that segment of the pool transfers to you, just as your whisky transfers to them. There is no actual bank movement of money.
You can re-invest instantly. You would probably leave your money on account if you were looking to re-invest at some near future date. You can sell and buy repeatedly on WhiskyInvestDirect without ever incurring the cost of a cash settlement to your own bank.
As with any other WhiskyInvestDirect transaction, the whisky for sale will be reserved, but will not be deducted from your account until settlement is complete.
When you require payment we will return the money to you by bank transfer (e.g. BACS or CHAPS within the UK, or by SWIFT transfer internationally).
All repayments from WhiskyInvestDirect are carefully examined and authorised by our staff, and transmitted during UK banking hours.
Is interest paid on money held in the pooled segregated client account?
No. If your quarterly interest entitlement would ordinarily exceed £100 or equivalent contact us via email and enquire about a commercial discount on your future commissions. This is operationally more efficient for us, and saves you paying tax on your interest only to then pay us commissions out of taxed money.
Can I buy now and pay later?
No. Absolutely never. WhiskyInvestDirect's efficiencies come about partly through the elimination of the risk of a default by someone who might execute a trade without an available cleared cash balance.
Can I deposit cash?
No. Absolutely never. WhiskyInvestDirect requires that all incoming monies come from a source which has been validated in the banking world. Each account only accepts monies from its original funding source, and only remits funds back to that source.
WhiskyInvestDirect is committed to avoiding any suspicion that it is a useful utility for money launderers.
Can I use my whisky as collateral?
There is no specific objection to using WhiskyInvestDirect whisky as collateral against debts outside WhiskyInvestDirect, but the arrangements have to be concluded between you and whoever requires a charge over your whisky. WhiskyInvestDirect does not itself become involved in such a situation.
What is the minimum purchase/trade size?
1 Litre of Pure Alcohol (LPA)
You should also consider the minimum custody charge when planning your investment.
What is the maximum purchase/trade size?
There is no maximum, subject to the availability of stock.