You'd need to be living on a desert island not to have read some headlines regarding gold over the past few weeks. In this post I take a closer look at the move, the possible drivers, and look to the shape of the gold volatility surface for information.
What I conclude is that gold represents a portfolio hedge against two very specific and low-probability macro-economic events. Its price therefore is sensitive to the marginal investor's assessment of the probabilities of these extreme events.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.