Re:Facebook shareholders are getting fed up with Zuckerberg ...
by mikestew on Wednesday April 17, 2019 @04:14PM
(#19686079)
You are not permitted to use retirement funds for any margin trading, including short-selling.
Ah, of course, borrowing the shares and all. Hadn't given it a lot of thought, frankly; short trading stays away from the IRA.
If your IRA let you sell calls, you likely own the underlying equity.
For sure, trying to get rid of the underlying stock that I didn't want anymore. I'd be shocked if one were allowed to use their IRA to trade, say, naked puts. But without looking to see if I've done it, I'll assume one can buy puts (with a trade for the underlying stock) because I buy calls all the time using the IRA.
Re:Facebook shareholders are getting fed up with Zuckerberg ...
by encoderer on Thursday April 18, 2019 @12:04AM
(#19688627)
You don’t need to own the underlying, you just need to define your risk by, for example, buying a far out of the money call. You would need to have funds to cover the buying power tied up but many options plays like this would be done over a short period so it can be viable.
https://www.irs.gov/publications/p590b
> Generally, a prohibited transaction is any improper use of your traditional IRA account or annuity by you, your beneficiary, or any disqualified person.
> The following are some examples of prohibited transactions with a traditional IRA.
> - Using it as security for a loan.
If your IRA let you sell calls, you likely own the underlying equity.
Surprising how many people aren't familiar with the rules and just downvote