We explain the best ways to invest in gold through funds, Exchange Traded Commodities (ETCs), bullion and coins. The first pure gold coins were struck by King Croesus of Lydia (present-day Turkey) during his reign between 560BC and 547BC - and gold coins have continued as legal tender ever since. Many years down the line, investors still love gold and the precious metal has proved a valuable winner in recent years. Going for gold: The precious metal has cooled after a spectacular rise, but investors say it is still one for the long-term. Update: Gold's recent run Gold hit record highs in September 2011, yet never went on to crack the $2,000 an ounce mark widely forecast at the time The spot gold price, which is typically measured in US dollars, hit a peak of $1,920 during that month. Some tipped it to soar beyond $2,000, but instead gold slipped and spent most of 2012 stuck in a range, shuttling back and forth between around $1,600 and $1,800. A sell-off since December 2012 has seen gold drop as share prices have climbed. The spot gold price stood at $1,571 or £1,040, at the start of this month. The dramatic falls of the past few days sent it down below £1,000 to £899 on 15 April. At $1,370 gold is down 29 per cent on the peak. However, gold bugs - as the precious metal's fans are called - say that bullion's recent dip has to be put into context. Look at a long-term chart of the gold price and you will see that even having lost almost a fifth from its peak, it is still up substantially in recent years. Gold fans say the metal is marking time and while short-term traders may lose money, the long-term fundamental case for investing, based on gold's historic store of value as nations around the world printing money, still stands up. Enlarge Marking time: While gold is off almost 20 per cent from its 2011 peak, fans says that set against the bigger picture it is simply consolidating. Why gold? Savers opt to invest in gold for usually one or two reasons - it's traditionally viewed as the ultimate safe haven during times of economic volatility and therefore seen as a wealth preserver. In addition it is used as a hedge against the US dollar. Given that stock markets have endured some of their worst falls on record as the financial crisis hit, that the response to this was to print unprecedented amounts of money and that the dollar has been floundering, it should come as no surprise that gold boomed. In addition, it is liquid, so therefore easy to sell and buy. It always has supply issues - mining output peaked in 2003 and there's never enough to meet demand. Gold's long-term returns Although gold like any other commodity, experiences periods of, sometimes very strong volatility over the long term its returns have been spectacular. Famously, when Gordon Brown was Chancellor of the Exchequer, he sold off more than half of the UK's gold reserves - some 395 tonnes - in a series of auctions between 1999 and 2002, when the price of bullion was in the doldrums. The move cost the public purse billions of pounds as the average price achieved in the auctions was $275 an ounce. It is very important to remember, however, that while gold has a strong track record of holding its value in terms of what you can buy with an ounce, its price is also entirely dependent on investor sentiment. It can also be very volatile, as it is widely traded by people hoping to turn a quick profit. When you buy a share you take ownership of a small part of a company that aims to grow, generate profits and return cash to investors either through share price growth, dividends or both. When you buy gold, you are buying some precious metal that people hold as valuable, albeit a lot of people over thousands of years. What you need to know about investing in gold Exchange Traded Funds Exchange Traded Commodities - the commodity equivalent of Exchange Traded Funds (ETFs) are also a direct route into gold. These track a particular sector, or in this case commodity. They are passive investments and should merely mirror gold's moves, although some will offer leveraged returns or the opportunity to short the price. Make sure you understand the difference between ETCs that are physical (actually buying gold) and synthetic (set up to mimic its price). Read this guide to ETFs. Popular physical gold ETFs include ETFS Physical Gold (PHGP) denominated in sterling, ETFS Physical Gold (PHAU) denominated in US dollars and ETFS Gold Bullion Securities (GBSS) Physical gold The main way to tap direct into actual gold is by buying bullion or coins. This can either be done through a traditional dealer or through one of the new online services that have grown swiftly in recent years. Bars of gold are sold in different weights but even a smaller one will prove expensive. GoldMadeSimple listed a one ounce bar at £1,115 on 3 April 2013, a kilo bar would cost you £34,886.