J.P. Morgan's senior think tank believes that while reasonable arguments can be made against the continued rise in gold prices, these arguments ultimately remain flawed.

"Over the past five years, gold has undergone a rapid upward trend, surging by more than 170%," wrote Kriti Gupta, Executive Director at J.P. Morgan Private Bank, and Justin Biemann, Global Investment Strategist. "There is a long list of reasons behind this, but the biggest driving factor is likely a new era of geopolitical instability and fragmentation, which encourages investors to buy the precious metal."

"Now, concerns about currency devaluation, economic growth, inflation, and irresponsible fiscal conditions that have not yet been fully reflected in sovereign assets are adding to the mix," they continued. "It's no wonder that this precious metal has remained a popular asset for investors during times of stress."

"During major geopolitical shocks, gold has delivered an average return of 1.8% and a median return of 3.0%, outperforming other asset classes."