Why is it that gold continues to be a favourite among investors as an asset class? What explains this interest in gold?

There are various reasons for the lure of gold but broadly they can be broken up into five justifications.

· Gold is indestructible. Almost every ounce of gold that has been mined in history is still available in some form. That is what makes gold unique.

· Gold is one of the most effective diversifiers. Gold rarely moves in tandem with equity and debt. So adding gold reduces your risk in uncertain times.

· Gold moves in prolonged phases but is also stagnant for long periods of time. However, over longer periods of time, it does manage to better inflation.

· Gold prices are never as volatile as equities. By adding gold to your portfolio, it makes your overall portfolio less risky.

· Most central banks like the Fed, ECB and Bank of England have increased liquidity post 2008. This could lead to debasement of these currencies. Gold can be a useful asset in such times as it normally moves contrary to the US dollar.