What Defines Market Timing?

Drifting

Expert
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With a variable annuity it says in the prospectus that market timing is not allowed. But what happens if I move 20% into bonds and a week later or perhaps a month or two later or even a year later stocks crash 20% and I want to move that bond money back into stocks? Do you think that would that be considered market timing?
 
Every company will work and manage accounts differently. You should not be trying to "day trade" mutual funds or sub-accounts.

The last guidelines I recall were with American Funds that you couldn't go back to your original allocation until after 30 days had passed. This was several years ago, but I'm pretty sure a "30 day provision" applies. So in short, you could make portfolio allocation changes once every 30 days.

Call your VA company and ask them.

However, be aware of another caveat: If you have any kind of living benefit rider... many times those riders could be void unless you use and keep to their model portfolios. So, instead of picking and choosing funds, you are simply choosing your asset allocation model instead.
 
As others have said read your prospectus and it will tell you exactly what you can and can't do.
I recently switched from Sun America to Vanguard. Neither were specific in the prospectuses in defining what "market timing" is. I have yet to change allocation with Vanguard and it's been over a year but I will soon (shifting from 100% stocks to about 10 or 15% bonds). If ever asked I will deny deny deny. I've got a few answers that I'll give them if I ever wind up doing any quick trades. Of course that would only happen if I timed the market perfectly. I'm in index funds so it's not gonna effect them much anyway. My understanding is that it's with actively managed funds that the fund gets adversely effected for the other investors when people keep shifting in and out of the funds.
The last guidelines I recall were with American Funds that you couldn't go back to your original allocation until after 30 days had passed.
Thanks. Good to know.
 
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