It's sad but true: If there were no asset bubbles, investing would be a whole lot less exciting. After all, who wants to buy a boring old index fund and sit back and watch your earnings grow at the same rate as the rest of the market? No, investors want the stock that will double overnight or the mutual fund that focuses on the hottest and fastest-growing sector of the market. Folks are always on the lookout for the next hot new thing, and right now, they've got one in their sights.

Bandwagon now leaving the station
Anyone who has been paying even a sliver of attention to the investing world as of late is fully aware of the market's new darling -- gold. Gold bugs have been coming out of the woodwork, and TV commercials selling gold coins and offering ways to profit from the precious metal are filling the airwaves. All the attention is not surprising -- the price of gold has risen by nearly 30% in 2009 alone, and has more than doubled in the past four years. Gold-related stocks like Seabridge Gold (AMEX:SA) and Gammon Gold (NYSE:GRS) are up 93% and 113%, respectively, year-to-date.

And now investment managers are getting in on the act. According to a recent Wall Street Journal article, some fund skippers who hadn't given gold the time of day before are now adding the metal to their portfolios. Worries about the exploding federal deficit, an expanding monetary base, and future inflation have prompted them to hedge their bets with gold. Many managers who aren't buying physical gold bullion are instead stocking up on gold-mining companies. Yet many of them, such as Goldcorp (NYSE:GG), AngloGold Ashanti (NYSE:AU), and Yamana Gold (NYSE:AUY), have outpaced the overall stock market so far this year -- prompting longer-term gold investors to take profits.

Amid all the debate, one thing is clear: Gold is definitely the trendy place to be right now.

Late to the party
But if you're thinking about going out and buying a gold bar or two to hedge against a global meltdown, hold your horses. If there's one thing you should remember, it's that once you start seeing late-night infomercials about "sure-thing" investing in a certain corner of the market, you can bet that the easy money has already been made.

Investors are notorious performance chasers, eager to pile into a hot area after a meaningful run-up has occurred. Gold is likely forming its own bubble, even if it is in the early stages. I don't think it's a bubble that will necessarily pop any time soon, nor do I think we'll have a repeat of the 1980s, when the price of gold plunged 90% from its peak. But if you're thinking about buying gold to make some easy profits, odds are good you've already missed most of the party.

Furthermore, if we look to history, gold simply has not produced solid long-term returns. Returns from a broad basket of stocks have left gold returns in the dust over long periods of time, going back decades. The truth is that gold can be an excellent diversifier and short-term hedge, but it hasn't made a great long-term investment in its own right when you look at it over a span of 20 years or more.

In times of economic uncertainty like we have seen in the past few years, it's not surprising that gold has shot through the roof. And if runaway inflation does take root in the U.S. or the global economy dips back down into recession, gold bugs will be well-insulated from these shocks. Investing in gold may be a good defensive move, but if you haven't already, you're not likely to make a whole lot of money from it.

Your golden opportunity
If you simply can't bear to be left out of the gold frenzy, make investments with your eyes open. Understand that you may be buying near the peak and that just because gold has been on a tear lately, that doesn't mean you'll see another 30% rise in 2010. Also consider that you may already have some indirect exposure to gold through some of your mutual fund holdings. According to the same Wall Street Journal article, the average large-cap growth fund now holds a 3% allocation to metals and mining stocks.

If you're looking for more direct equity exposure, think about investing in solid, mid-sized mining names like Canada-based Ivanhoe Mines (NYSE:IVN). Ivanhoe boasts a strong international mining presence, especially in China, and has more upside growth potential than many of its larger mining counterparts.

If you want to more closely track the performance of gold bullion itself, consider an inexpensive exchange-traded fund like SPDR Gold Shares (NYSE:GLD). Just keep exposure to such a fund to a very small portion of your overall portfolio.

We're likely to continue to hear a lot more about gold in the coming months, so it will take a lot of discipline to sit tight and not buy into the hype. Gold is an investment that has its uses, but it may have already run much of its course in this business cycle. For most investors, this is one gold rush you can live without.

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Amanda Kish is the Fool's resident fund advisor for the Rule Your Retirement investment newsletter. At the time of publication, she did not own any of the funds or companies mentioned herein. The Fool has a disclosure policy.