Xyrus

Spread the Wealth with Gold: Three Longer Term GLD Option Strategies

Except gold doesn't really increase in value. Gold is a store of value. There are few industrial uses of gold, and a relatively small amount of gold is dug up every year. This keeps the amount of gold fairly stable.

Other commodities such as silver, platinum, and oil, on the other hand really do increase and decrease in value since they have wide industrial uses and, at least in the case of oil, it is being depleted and cannot be replaced easily.

Chances are when gold goes up in price in your currency, your currency has weakened yielding a low (if any) gain in your pocket. So you may have bought gold at $500 and sold at $1000, but that does little good when the currency depreciated by 50% during that timeframe (and now you've got to pay taxes on the gain, though in real terms you've gained nothing).

Gold is a good hedge against inflation, but it isn't the best investment if you're looking to grow your money.

~X~