No. of Recommendations: 1
Not quite.

Assuming you are talking about retirement savings accounts, such as a 401k or an IRA, moving money in and out of a particular investment (mutual fund or equity position) within the account is not a taxable event. If you take a distribution out of the account, then it because a taxable (and if under age 50 1/2 a penalized) event.

Bottom line is you can invest in anything your IRA account allows, from CDs to mutual funds to ETFs to equities. You can sell under performers and buy into investments with greater potential. You can do this as often as you want, although each transaction will likely cost you a transaction fee.

Note that with a 401k, you may not have access to a full range of mutual funds or the ability to trade equities and ETFs. But the same rules apply - you can move funds around between investment options without incurring any tax liabilities or penalties, you just can't pull money out until you reach retirement age.

Who cautions that most mutual funds have penalties for selling positions within a 90 days of purchase (or other specified time period)...
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