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IRA Account
- Thread starter NanoTick
- Start date
I looked into this a while back and if I remember correctly, the issue is margin. You can't trade on margin in an IRA acct. I believe you can hold foriegn currencies, but not levereged. You can trade futures as you're not posting margin, but more of a performance bond. So your best bet may be to trade some of the currency eminis.
If you dig around the IB site there is some info relating to all of this.
HTH.
If you dig around the IB site there is some info relating to all of this.
HTH.
Check out http://www.elitetrader.com/vb/showthread.php?s=&threadid=58963
I've already done the research on this, and am getting ready to implement.
FYI, the only way I've been able to find on how to do this is to create an LLC, and have my IRA buy into it.
I've heard of some dealers that have IRA Forex accounts, but the legality are questionable. Creating an LLC takes care of the legal issues, since the IRA doesn't have to worry about a margin call.
I've already done the research on this, and am getting ready to implement.
FYI, the only way I've been able to find on how to do this is to create an LLC, and have my IRA buy into it.
I've heard of some dealers that have IRA Forex accounts, but the legality are questionable. Creating an LLC takes care of the legal issues, since the IRA doesn't have to worry about a margin call.
Quote from NanoTick:
I'm thinking about rollover my IRA account to a FOREX brokerage. Are there any restrictions on trading an IRA account compared to taxed accounts? (e.g. marging, settlement, etc.). Can you day trade an IRA account?
This seems a bit strange to me hearing these different responses from people ...I haven't had the chance to read the last posters article, but I've never had any problem with being able to trade IRA money in the spot forex market....I've always used millenium trust http://www.mtrustcompany.com/ to be the middle man of the rollover. I'm not sure if that's the reason why I've never had a problem, but all legalities are handled on their part. After it went through them I was able to have it go to my clearing firm, and from there I was able to trade the money however I saw fit....including whatever leverage was available...buy ...sell... day trade even... Give millenium a buzz I'm sure they can help you out, and I'm only recommending them because of my personal experiences ...I'm in no way affiliated with them.
Quote from mrvizion:
This seems a bit strange to me hearing these different responses from people ...I haven't had the chance to read the last posters article, but I've never had any problem with being able to trade IRA money in the spot forex market....I've always used millenium trust http://www.mtrustcompany.com/ to be the middle man of the rollover. I'm not sure if that's the reason why I've never had a problem, but all legalities are handled on their part. After it went through them I was able to have it go to my clearing firm, and from there I was able to trade the money however I saw fit....including whatever leverage was available...buy ...sell... day trade even... Give millenium a buzz I'm sure they can help you out, and I'm only recommending them because of my personal experiences ...I'm in no way affiliated with them.
I looked into Millenium awhile back. Though I've heard of people trading with them in an IRA account, I'm fearful the the IRS one day may look at those accounts, and give them a lot of scrutiny. FOREX trading is still relatively new, and the IRS auditor might get all spun up on MARGIN trading, which in the land of IRA's is a NO NO.
That's why I went with the LLC route. Technically when an IRA buys into an LLC, and the LLC is doing margin trading, the IRA account is not margin trading.
Yes, I know, FXCM says you can't loose more than your principle, but doesn't say it in the traders agreement. (Which should send up red flags, since the auditor may only look at the traders agreement.
mrvizion,
Thanks for the info. I've heard a recommendation for millenium trust from another source so I trust what you said. My main concerns are leverage and settlement time.
1. Are you able to get the same leverage as a regular account, such as 20:1 or 50:1?
2. Is the buying/trading power restored instantly upon closing a position? (so I can have a high trading frequency)
Thanks for the info. I've heard a recommendation for millenium trust from another source so I trust what you said. My main concerns are leverage and settlement time.
1. Are you able to get the same leverage as a regular account, such as 20:1 or 50:1?
2. Is the buying/trading power restored instantly upon closing a position? (so I can have a high trading frequency)
Quote from ZoneTrooper:
I looked into Millenium awhile back. Though I've heard of people trading with them in an IRA account, I'm fearful the the IRS one day may look at those accounts, and give them a lot of scrutiny. FOREX trading is still relatively new, and the IRS auditor might get all spun up on MARGIN trading, which in the land of IRA's is a NO NO.
That's why I went with the LLC route. Technically when an IRA buys into an LLC, and the LLC is doing margin trading, the IRA account is not margin trading.
Yes, I know, FXCM says you can't loose more than your principle, but doesn't say it in the traders agreement. (Which should send up red flags, since the auditor may only look at the traders agreement.
I can understand your concerns perhaps but on the other hand I'm doubtful that they are promoting anything that the IRS will get their panties in a bunch over. It could very well be that perhaps in the future something might change but I've been doing business with them for years with no problems or discrepencies. Perhaps it's a loophole, as you are trying to exploit....Don't know...A matter of fact if you ask most retail firms they'll tell you to use them for a Self Directed IRA account. I know there's another place out there in California that I can't think of their name right now that is popular also...but whatever it is at the moment millenium seems to be handling things well.
Quote from NanoTick:
mrvizion,
Thanks for the info. I've heard a recommendation for millenium trust from another source so I trust what you said. My main concerns are leverage and settlement time.
1. Are you able to get the same leverage as a regular account, such as 20:1 or 50:1?
2. Is the buying/trading power restored instantly upon closing a position? (so I can have a high trading frequency)
No problem at all....As far as being able to use the funds as if it were a normal trading account....I've very literally never had a problem not one time....Meaning all leverage that was available I was able to use and I could buy or sell a currency pair as frequently as I liked without any hold ups. My only thing about using an IRA account for trading curencies is that you should think twice about how much money you use for it. Of course I have no knowledge of your trading capabilities, but I would suggest to anyone only use half of what your original thinking was....Then maybe after that...think again....
Vizion
Quote from mrvizion:
I can understand your concerns perhaps but on the other hand I'm doubtful that they are promoting anything that the IRS will get their panties in a bunch over. It could very well be that perhaps in the future something might change but I've been doing business with them for years with no problems or discrepencies. Perhaps it's a loophole, as you are trying to exploit....Don't know...A matter of fact if you ask most retail firms they'll tell you to use them for a Self Directed IRA account. I know there's another place out there in California that I can't think of their name right now that is popular also...but whatever it is at the moment millenium seems to be handling things well.
One other thing I didn't like about them was there cost. The company I listed in the other link has a nice flat rate.
I don't like fee systems where the custodian get's a percent of my account each year. After all, what is it to them weather or not I have a serveral million or a couple of thousand. The work on their end is all the same.