What's involved: Gold futures contracts allow you to buy the right to take delivery of gold at a specified future date. Futures contracts tend to track the changing spot price of gold, paying you profits when prices rise and losing money when they fall. Most futures investors sell back their contracts before they expire, never taking delivery of the physical gold underlying the contract.
Pros: You get the potential financial benefits of owning gold without worrying about storing it. You also don't have to come up with the full value of the underlying gold, as futures contracts require only a small margin balance covering a fraction of the gold's total value.
Cons: Futures contracts are only available through specialized brokerage accounts, and there are commissions involved. Also, most futures contracts will be too rich for the blood of the average investor: A standard contract corresponds to 100 ounces, worth about $160,000 at current prices. You may have that much in your portfolio to invest, but putting it all into gold futures could be too much exposure to one commodity.