The price of gold has skyrocketed as the COVID-19 outbreak has hit investors' confidence.
The price of gold has reached 2013 peaks as traders bet on safety. (Credit: JOEL SAGET / AFP)
Global stock markets have taken a hit, as people move their money from stocks that are considered risky to "safehavens" like gold and U.S. government bonds.
Major stock markets across Europe and Asia opened with falls on Monday morning, as traders reacted to hikes in infection numbers in the Republic of Korea and Italy.
But gold was the major "winner" as its price rose to the highest point in seven years. It's reached $1,600 an ounce for the first time since 2013.
The U.S. Treasury 10-year bond has also proved popular with those who wish to keep their property profitable.
However oil prices have fallen, as it is seen as a more precarious commodity. A drop in demand from China has also affected both crude prices, and the fortunes of energy companies which trade in Asia. China is the world's largest market for the import and consumption of oil.
"With the volatility we're seeing in the coronavirus event, that's creating angst in the market on the back of growth and demand expectations and we've seen oil prices weaken," said David Lennox at Fat Prophets. "The converse of that is the same event is carrying investors toward a safe haven play and that's gold."
Why gold?
Gold, put simply, is always in demand. It ranks as one of the most popular metals for jewellery, especially wedding rings.
It's often seen as the world's first form of money, and that's still reflected today in coins and currency around the world. Familiarity and recognition is a big part of why gold is seen as a safe investment.
It has been linked to the worth of global currencies since the Gold Standard began, and as a base of currencies gold is less volatile.
This all makes it a safe bet for market traders who want to avoid losses on commodites which react more to day to day activities, or sharp changes to demand.