Just when European investors thought it was safe to stick their heads above the parapet, a sudden surge in popularity for the coalition led by former prime minister Silvio Berlusconi has sent investors scrambling to cover their positions ahead of Italy’s forthcoming elections.

Investors looking to protect their assets against a fall in the euro in case Berlusconi succeeds in gaining power should take out option contracts on the single currency, according to Shahab Jalinoos, a currency strategist at UBS.