With Y2K just around the corner, gold is being mentioned as a possible hedge against the turmoil some say will occur when Jan. 1 rolls around. There are many different ways to invest in gold. You can buy shares in a gold mining company, gold coins, certificates, wafers and bars and future contracts on a commodity exchange. Gold is among a number of precious metals that increase in value whenever investors think society is on the verge of collapse.
Gold is also is a hedge against inflation.
But buying gold is relatively new thing for investors. It wasn't until 1975 that the U.S. government stopped setting a price on gold and allowed the average citizen to own it. The U.S. began moving away from the gold standard in the mid-19th century. Unlike stock, which grows in value because of increasing earnings, new products, dividends or stock buybacks, gold just sits there. Gold is about one-half that.