My brothers-in-law and I are doing something that may seem odd with the way the stock market is right now. We are investing in individual stocks, with the help of 7 free trades from Scottrade! (Note: you can get seven free trades as well by using the referral code GFDF2643 when opening a new account.)

At a time when the market seems to keep heading down, you may think we are crazy, but many experts including the Oracle of Omaha seem to be on our side. Consider the following sage advice from the great Warren Buffett:

We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

In other words, this is the best time to make informed investments in the market because prices are so low. It is kind of like buying Christmas decorations after the holiday: just because no one wants these things right now doesn’t change what they are or the fact people will want them in the future.

So what are we buying? I had one brother-in-law make a good size bet on AIG last week at $4 a share, who then resold it after it fell and came back to $4 and then bought it again when it was around $3.90. Was this part of a grand plan? No, just a weak stomach mostly. His idea is that AIG has fallen so far from its high and that it got the funding it needed it is almost certain to rebound to some extent.

I’m not quite as confident in his reasoning on AIG (so many questions still in the financial sector), so I made a different play. I purchased a little over $5,000 worth of Transocean (RIG) midday today. For those of you unfamiliar with the company, they are the leading maker of drilling rigs and drillships. Their stock had been as high as $163.00 earlier this year, but had fallen from about $130 to around $90 in a little over a week. The concerns were lower crude prices could reduce demand for rigs and that there may be negative effects from the credit crunch on their operations since they are more highly leveraged than most firms in the industry. Knowing from my work in the oil industry that this is a very well run company, seeing that RIG actually paid back over $1 billion in debt in the last quarter alone, and knowing that oil companies are making investments in drilling for the longer term, I made the assessment that these fears were unwarranted and that this was a screaming buying opportunity. So with the stock selling for about 5.4 times earnings, I bought in. Unfortunately the stock is already down about $6 a share from where I bought it, but this is an investment we are making for the long haul. The first brother-in-law also bought into RIG today as well, so hopefully the volatility doesn’t have him reaching for the Maalox yet.

My other brother-in-law also got into the fray today by purchasing a few shares of Valero (VLO), a leading oil refining company. I haven’t gotten the reasoning on this move yet, although it appears to be another value play like Transocean. The company is trading in the mid 20s from a high of $75.75 and now sports a P/E ratio of about 5.6. I’m not quite as optimistic about the refining industry’s prospects, as I have worked in the industry and know it is often tough to make money.

There are never any certainties in the stock market, but now is likely the best time to make informed buys, as long as you have a decently long time horizon to ride out the crazy market swings we are seeing. Don’t worry too much about trying to time the exact bottom since if you do the opportunity may pass you by.