In general, when the political and economic stability of one or more nations which are integral to the world financial systems suffer from catastrophe, investors around the world start investing in gold. Sometimes it can be a small, seemingly insignificant country that causes a price movement. Generally, the reason for the nation's importance is a key raw material or the strategic location of the country. These events can be man made such as civil war and revolution, but they can also be natural such as earthquakes and tsunamis. If too much of a nation's currency is pumped into an economy without the productivity to back it up, that nation will suffer inflation in its currency. Investors can protect themselves from monetary inflation by buying gold, which will always increase in value equal to or faster than the rate of inflation. In the past and even now, buying gold coins has been a popular way of investing in gold. However, there are several problems with this. Buying and selling gold coins is not as fast as most of the gold dealers would make you believe. In those cases where you can sell your coins fast, you will usually have to pay a steep premium. In addition, there is a chance that your gold can be stolen as you are in physical possession of it. Moreover, physical gold doesn't pay a cash dividend. So it's hard to generate monthly income from it but there is a solution to the problem.

There are several ETFs (exchange traded funds) that focus on gold. The most common is GLD (SPDR Gold Shares ETF). It trades like a stock and at the same time, it is also optionable. It means that meaning there is a market for call options on it. You can buy the ETF and then sell call options against it to collect monthly income.

For example, GLD currently trades at $128/share. If you buy 100 shares, you can then sell 1 October 128 call option for $1.70. It means that you can collect $170 today in exchange for selling your shares at 128 between now and Oct 15, when the options expire. If GLD is below 128, then you keep the $170 and the shares, and can then sell a November cycle option. If GLD is over 128, then you will receive 128 per share when the option is exercised. In that case you've made $170 profit on an investment of $12,300 ($12,800 you paid for 100 shares minus the $170 you got for the option), which is an annualized rate of return of 29%.