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Dollar Cost Averaging – an investment strategy designed to reduce volatility in which securities, typically mutual funds, are purchased in fixed dollar amounts at regular intervals, regardless of what direction the market is moving.

Please excuse this uncharacteristic foray into personal finance, but I find myself in a very unique situation. When working full-time from 2000-2006, I was the kind of person who maxed-out my 401(k) and even took the time to set-up a Roth IRA, maxing that out as well. I spent about 6 years doing this before I left IT to start a small business.

As I was leaving my job I decided to migrate my 401(k) to a traditional IRA at my brokerage because I hated the limited choices that the 401(k) provider offered. So, into this IRA came a decent cash infusion, and there is sat. I became too busy to think about what to invest it in and soon forgot about it.

A few years later (2008) I was embroiled in a legal conflict and felt very uncertain about what might happen. So, I liquidated some holding I had in my brokerage account (not my IRA’s, just my normal account) in order to have cash on hand in the case of an emergency.

SO! This brings us to today and absolute wreckage that are our public markets. As I write this, the DOW is at 9,955 and 28% down YTD. My own portfolio is down about 18% YTD. The question is, is this a good time to buy? I sure thought so back in late September. Check-out my portfolio prior to September 22nd:

I decided to make a large investment in an S&P 500 index fun as well as invest in a company I’ve always wanted to own, Google:

To date, I’ve lost 25% on my Google stake and 15% on the S&P 500. Never to be put-off, I then woke up this morning and decided to buy some more firms I admired, Intel, Ebay and News Corp:

How much will I lose on them on the coming days, who knows. All I do know is that things always seem bleakest before they get better. I would like to continue to make investments all the way down, buying stock at cheaper and cheaper prices. If you have a chance, read Mark Cuban’s post about how to get rich. It’s ultimately a diatribe about the ROI you can earn on simply being smarter with your spending (great point) and the value of having cash on hand to take advantage of opportunities when they present themselves.