Gold and Precious Metals

A precious metal is a rare metallic chemical element of high economic value. Chemically, the precious metals are less reactive than most elements, have high luster, are softer or more ductile, and have higher melting points than other metals. Historically, precious metals were important as currency, but are now regarded mainly as investment and industrial commodities. Gold, silver, and platinum each have an ISO 4217currency code.
The best-known precious metals are gold and silver. While both have industrial uses, they are better known for their uses in art, jewellery and coinage.
The demand for precious metals is driven not only by their practical use, but also by their role as investments and a store of value. Platinum, as of January 29, 2008, is valued at $1,706 USD/ounce, which is almost twice the price of gold, at $995 USD/ounce. Silver is substantially less expensive than all of the other precious metals, presently less than 1/50 the price of gold, but is often traditionally considered a precious metal for its role in coinage and jewellery.

Gold Price
The usual benchmark for the price of gold is known as the London Gold Fixing, a twice-daily (telephone) meeting of representatives from five bullion-trading firms. Furthermore, there is active gold trading based on the intra-day spot price, derived from gold-trading markets around the world as they open and close throughout the day.

Silver Price
The price of silver has been notoriously volatile as it can fluctuate between industrial and store of value demands. At times this can cause wide ranging valuations in the market, creating volatility.
Silver often tracks the gold price due to store of value demands, although the ratio can vary. The gold/silver ratio is often analyzed by traders and investors. Over most of the 19th century, the gold/silver ratio was fixed by law in Europe and the United States at 1:15.5, which meant that one troy ounce of gold would buy 15.5 ounces of silver. The average gold/silver ratio during the 20th century, however, was 1:47.

(source: wikipedia)