Market volatility is the new mantra of finance.  Buy and hold forever has been the financial mantra ever since Benjamin Graham's book Intelligent Investor was published.  However, we have decided that market volatility is going to be with us for many years to come.  Our choice was to follow the crowd by buying stocks via dollar cost averaging holding them forever and watching our investments torn asunder almost daily.  Or find a better way.

Our financial ship turned to a new course in October 2011.  No longer were we going to buy and hold.  We chose to embrace the voracity of the market's volatility.  If the market was going to go up one day and down the next, we were going to play the game accordingly.

The key was Electronically Traded Funds (ETFs).  To the benefit of individual investors, we could trade ETFs frequently, even daily, without incurring transaction costs.  We selected broad ETFs recommended by many of the financial gurus in the market today like Vanguard's Total Stock Market Index (VTI).

Our system is simple.  Every time the ETF goes down by $0.50 we purchase 50 shares using limit orders.  As it continues to fall, we continue acquiring 50 shares at $0.50 intervals.  As soon as our orders are settled, we input sell orders at $0.50 above our cost for the particular trade, again using limit orders.

So, let the markets continue to be volatile.  Every time the markets fall we acquire shares.  When the markets turn around, and it always does, we sell shares.