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Can you trade on margin and short stocks in your self directed IRA?
Wiki User
∙ 15y ago
According to IRA regulations, if any part of an IRA is used as collateral, the entire IRA is considered to be distributed. Distribution of such accounts are subject to income taxes and an additional penalties. This is important because margin accounts require that you pledge your account as collateral. Your attempt to convert an IRA account into a margin account will nullify it's "qualified" status. It is for this reason that investment firms will not provide margin for a retirement account. Also, because shorting stocks requires the use of a margin account you can not invest in this way either. If you wish to short stock you must open a standard margin account that is not a qualified retirement account.
Wiki User
∙ 15y ago
Wiki User
∙ 12y agoNo. Why? Because my ira broker said so. Why still? Nobody seems to have a intelligent answer for this question. Seems to me if you can buy stock in an ira which is a long postion you should be able to short it. No physical stock is delivered in either trade as I see it.....it's all electronic and seems like it should not matter.
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Where are most stocks in the us trade?
You can find most stocks in the us trade right here
What is the total number of people that trade stocks?
Millions across the globe and in many countries trade in Stocks. It is impossible to narrow down with the exact number that trade in stocks because of the fluctuations in the numbers that trade in the markets
How did the practices of buys on margin and speculation cause the stock market to rise?
Buying on margin allows people to leverage their cash to 2X the size, with a loan from their broker. Investors use margin to trade bigger positions, without having the money for those trades in hand. So margin allows for more money to flow into the stock market, causing individual stocks to rise. But in order to trade with margin, you have to maintain a certain amount of leverage (cash) in your account. If a stock price falls, a broker may require you to put more cash in your account...if you don't have it, your stocks are sold. What is happening is that many investors can't come up with the cash and their stocks are sold automatically so the value of the initial loan is preserved. The avalanche starts as more and more investors are forced to sell when they don't have cash available.
how can I do trade penny stock online ?
Most of the large brokerage houses do not trade in penny stocks. Some brokers that trade penny stocks are TDAmeritrade, Scottrade, and ChoiceTrade.
How did speculation make the stock market climb?
Companies offered shares of their stock for sale to the public to generate capital. The public in pre-1929 era bought stock. When buying stocks on margin, one could buy stocks without the money to purchase them and demand led to high prices.
Can you trade a pink sheet stock?
Yes you can trade Pink Sheet stocks as well as OTC (over the counter) and Bulletin Board stocks.
What does BP Effect in Stocks mean?
BP effect is the effect on Buying Power your trading account has. if you're using the Think or Swim software it lists "BP Effect" in the "Activity and Positions" section. It correlates to the margin required for a trade.
What does does buying a stock on margin mean?
Buying on margin means the broker you use will lend you additional money to trade, but they also begin charging interest for the money as soon as you use it. It's a little like a credit card, but you have to pay interest from the moment you use the money. You must fill out an application for a margin account and be approved by the broker. There is a chance too for what's called "a margin call." This can occur if a stock you buy on margin goes down to a point they deem is too low and they'll want you to put more money in the account to help cover the loss. Also, if a trader wants to short stocks they'll need to open a margin account to do so. I have a margin account, but rarely use it unless the general market trend up is very strong or if I want to short. Otherwise, you can really get in a bad way if the stock goes down and you're paying 10% on the original balance too. Trade on! http://stock-trading-warrior.com
Is there a cost for using internet stock trading?
"Yes, there is a fee to trade stocks online. How much that fee is depends on where you choose to trade stocks. I know that etrade has a flat rate of $8.00/trade."
What are stocks and how do you trade?
Stocks are businesses that you invest in if you think they will do well in the market. You can bid money on certain stocks and if the business/company does well, you get money back.
Where can one learn for free how to trade stocks on the FTSE?
There are several places that promise to teach people how to trade stocks on the FTSE. A few of these places include OptionsXpress and Trading Academy.
What are otc stocks used for?
"otc stocks are used for the normal stock trade. you can keep all your stocks close and spread them out for the maximum protection and necessities, it is great."
