A technique used by investors or money managers who believe they can predict when the market will change course. For example, a mutual fund manager might switch the bulk of his fund's holdings from stocks into bonds or cash when he thinks -- based on analysis, his own ""gut feeling,"" or both -- that stocks have peaked. If he times the market correctly, he could make a huge profit. Then, when he thinks the stock market is ready to take off again, he could shift back into stocks in an effort to make another big killing.
History has shown that few investors can consistently time the market.