John Maynard Keynes referred to gold as the "Barbarous relic", and billionaire hedge fund manager George Soros described it as the "Ultimate Bubble". Even Warren Buffett believes it has no place in an investment portfolio. Yet despite a whole host of other prominent gold skeptics, such as the Financial Times, The Economist and CNN's Fareed Zakaria; gold still remains an incredibly popular asset class. No other investment topic triggers such impassioned and fierce debates as gold. Gold bugs eternal enthusiasm for this shiny yellow metal has always puzzled me. Their justifications for holding gold simply do not stand up to scrutiny.

Inflation? What Inflation?

Two of the most often touted reasons for holding gold are that it's a hedge against inflation and a protection against the potential collapse of our monetary system. Firstly, the spectre of runaway inflation, predicted by many economists following quantitative easing hasn't materialised. In

One of the most enduring and dominant investment themes of the 21st century is rising consumption. The argument is well established, the expansion of the middle classes in the emerging economies drive economic growth. The "global middle class" is projected to reach over 1.2 billion people by 2030. Emerging from the burgeoning middle class is an upper stratum of affluent consumers, providing the impetus for higher discretionary spending. European products with strong, well-recognized brands are ideally placed to benefit from this trend.

Soaring incomes, a bulging upper middle class and technological advancements will inevitably lead to growing gap between the haves and the have-nots. However Astute Investors will be able to identify opportunities to profit from diverging incomes. As the rich continue to get richer, they will lavish more of their money on luxury goods. Therefore shrewd investors can tap into this trend by investing in luxury brands,

Diversification, a technique to reduce risk by investing in assets that are less than perfectly correlated with one another has been rendered increasingly infective by what J.P. Morgan calls a ‘Correlation bubble.’ Global Equity markets have rapidly become correlated over the past decades. Correlations in the average weekly price change of 23 developed stock markets against the MSCI World Index have reached over 0.8 in 2011, according to Societe Generale. Investors will often find that a sell-off on Wall Street will have spread to Asia and Europe. Why are global stock markets synchronised and how should investors respond to this phenomenon?

John Authors’, the head of FT’s flagship Lex column, wrote a book on this extraordinary development titled "The Fearful Rise of Markets." He lays out the key reasons for this development:

• The rise of the investment industry. Most assets today are managed by professional investors acting on

Gold has delivered remarkable investment returns, from 2001 to 2011 it has increased fivefold, analyst are now predicting that the shiny metal will hit $2000 an ounce by next year. It has come to astonish me that this worthless lump of metal whose value is "in the eyes of the beholder" is becoming a staple for every investor’s portfolios. John Maynard Keynes referred to gold as the "barbarous relic," I agree, it has become an asset class bought on the assumption that there is a "greater fool" willing to pay a higher price for it.

Nearly every day you’ll see a financial professional or journalist extolling the virtues of gold. The reasons for investing in this precious metal are well established, the five justifications typically repeated are usually:

• It is a protection against inflation.
• It is a hedge against currency devaluations.
• A safe haven in times financial market instability and

What is an ETF? Traditionally, exchange traded funds have been like 'index tracker funds', replicating the performance of a particular market or index. They are traded like shares on a stock exchange and can be bought and sold throughout the day. ETFs are traditionally passive investments; this means that with few exceptions they are not actively managed by a fund manager. Because ETFs do not require ongoing management, they can charge much lower fees, typically around 0.5% per annum which is one of their main attractions vs. mutual funds. Combine this with the benefits of diversification and additional tax benefits in many cases you can see why ETFs have grown exponentially over the last few years.

To put this phenomenal growth into perspective, ETFs have managed an average annual growth rate of above 30% over ten years and this year they are expected to control over $1.5 trillion of assets