Gold was highlighted by UBS as an appealing investment as a hedge against geopolitical risks from the Middle East and potential US political shifts in this election year.
After Iran launched its second missile attack on Israel this year, the price of the yellow metal picked up to $2,670 per ounce, having dropped back from last week's all-time highs in the past couple of days.
Investment bank strategists rushed to reassure clients that they do not expect the conflict around Israel to result in a huge impact for financial markets, as long as it does not escalate to other countries in the wider region.
UBS stated it believes the conflict poses has upped market volatility but the 'base case' prediction is to expect that the conflict will stop short of an all-out war between Israel and Iran, and their allies.
"Meanwhile, we believe the outlook for equities will be supported by a soft economic landing in the US, combined with Fed rate cuts, strong earnings, and optimism over the commercialization of artificial intelligence," said chief investment officer Mark Haefele.
"At the same, we do think investors should consider strategies to reduce the impact of market swings on their portfolios."
Gold was chief among potential hedges against geopolitical risks.
"The metal should also benefit from further Fed rate cuts, robust central bank demand, and rising investor appetite via exchange traded funds," he said.
The Swiss bank forecasts gold will reach $2,750 an ounce by the end of the year and $2,900 by the final quarter of 2025.
"The extent of risk-off move in markets will depend on whether the Middle East conflict worsens further," Haefele said, with the military situation in the region "fluid" and the potential for further deterioration now having increased.
"Israel’s and Iran’s future actions will be crucial and risk triggering a wider war. Similarly, other members of the 'Axis of Resistance', a group of Iranian allies that are also hostile to Israel, may contribute to escalation with their actions."
Investments in or bets on oil prices can also serve as a portfolio hedge against a worsening crisis in the Middle East, Haefele said.
Market fundamentals are "positive, in our view", he said, though Brent crude prices have fallen from $90 in April to almost $70 last week, before the attacks this week brought crude back up to around $76.
"Stimulus from China and a strong start to the easing cycle from the Fed should support energy demand."
The UBS base case is that Brent will trade around $87 per barrel by year-end.
"In the downside risk case of a multi-front war, oil prices would be a key transmission mechanism from the conflict into global markets," the chief investment officer said.
"While Iran has an interest in keeping energy flows unobstructed in the region, given its own dependency on oil exports, any impediment to Iranian flows may change the calculus and lead to disruptions."