Here’s a quiz question. Out of nine different major asset classes, including commodities, UK equities, cash and property, amongst others, which was the best performing in 1999? Answer: the hedge fund sector.

Now here is another — which sector was bottom for the three years 2000-2002, top again in 2003, bottom the following year, top again in 2005, but consigned to the foot of the table in 2006 and 2007? You have guessed it — the hedge fund sector.

I am grateful to HSBC Asset Management for this data because if ever proof were required that past investment performance is absolutely no guide to the future, here it is in spades. Despite this, our herd mentality continually pushes us into assets and sectors that are already overpriced or have run out of steam. Unfortunately, the same is true when we hunt for safe havens.

Just because a sector proved resilient in earlier times of economic woe does not mean to say it will do so again. The logic underpinning this statement is undeniable, yet investors continue to flock into those same areas, such as gold, Swiss francs and government bonds that were so reliable once before.

Granted, UK government bonds are widely regarded as offering the ultimate safe haven, while funds focusing on conventional and index-linked gilts are understandably popular.

But should interest rates rise over the next few years (and how long can they remain at 0.5 per cent?), it is feasible that holders of long-duration, ultra-low-yielding gilts could be hit with significant capital losses.

Then there is gold. Increasingly popular with investors, its price has risen sharply over the past few years to the point where it may be approaching ‘bubble’ territory.

Gold’s appeal is obvious. While the case is unproven, the yellow metal is considered to offer a hedge against inflation.

Less equivocal is gold’s status as a store of value, especially as paper currencies are increasingly debased by quantitative easing.

Despite this, gold remains extraordinarily volatile for an asset considered to be a safe haven. In other words, while investors could recognise a substantial gain by holding it, they could also suffer sizeable losses too.

Nevertheless, as economic fears intensify, many investors pay little heed to what has occurred in previous times and dive into gold, the demand for which has remained remarkably steady for the past couple of years.

Nor is it likely to wane when analysts issue comments which suggest gold’s price could hit $2,000 (£1,229) per troy ounce as the economic situation within the Eurozone deteriorates.

The annual Gold Survey report from Thomson Reuters GFMS was published recently, following which the consultancy’s global head of metal analytics, Philip Klapwijk, said: “We could easily see last September’s record high ($1,920.30) being taken out.

“A push towards $2,000 is definitely on the cards before the year is out, although a clear breach of that mark is arguably a more likely event for the first half of next year.”

Mr Klapwijk may well be correct. As governments continue to print money and oil prices rise, so the resultant inflation feeds demand for gold.

One thing worth remembering before you instruct your broker to buy gold. When the metal did hit $1,920.30 last September, it immediately fell by 15 per cent. Perhaps, on some occasions, particularly when we are in bubble territory, past performance can act as a guide to the future. ib