Gold prices hit a four year high this week while stock markets slipped towards eight month lows.

The latest price increase follows a substantial rise in May as fears of a military conflict between India and Pakistan increased.

At times of market instability, when investors are looking for safer places for their money, gold appeals because its price moves so independently from stocks and bonds.

The price of gold depends on supply and demand, the US dollar, inflation and interest rates.

An exhibit on show at the Goldsmiths Hall

Other assets in an investors portfolio will depend on different things such as a company's performance, earnings and growth potential.

As a result, gold can be a way of hedging your bets and diversifying a portfolio, providing a safe haven for cash in leaner times.

Money Box's Paul Lewis visited an exhibition at Goldsmiths Hall entitled 'Celebrating Gold & Silver' to speak to the experts about investing in this precious metal.

Rhona O'Connell from the World Gold Council explained why the price of gold has been rising so steadily.

"Demand has been outstripping supply for the last four years."

According to Rhona, about 70% of annual demand goes into jewellery, 8% into electronics and the rest is split between pure investment in the form of bars and coins, medical technological and dental use.

"It performs well against currency risk and particularly when the dollar is under pressure" Rhona O'Connell, World Gold Council

This demand alone rarely provides enough incentive to push the price up. But the return of the professional investor has, as Rhona O'Connell explained:

"The re-emergence of the professional investor goes back to a whole cocktail of reasons relating to the equity, financial and political environment over the last 18 months...

Gold performs well against currency risk and particularly when the dollar is under pressure."

A small investor can purchase gold from High St jewellers, banks and coin dealers for about �230 an ounce and the purest form of investment is small bars or coins.

No investment comes without risk but as Rhona O Connell explains:

"The prominent reason why people should look for gold investments is not capital appreciation but a store of value and a hedging of risk".

The exhibition 'Celebrating Gold & Silver' runs until 12 July at is at Goldsmiths Hall in London.