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There is nothing in the IRA act or in ERISA that says anything about
specific strategies. The IRA act and ERISA both DO NOT ALLOW any use
of leverage. So in effect any option strategy must be 100% cash
secured. Having said that some firms chose not to allow certain
strategies and that is their right. All of last month you could have
gone to the CBOE web site and seen adds for firms soliciting the
writing of puts in IRAs. It is perfectly legal as long as it
deleveraged. Most brokerage houses tend to allow covered writing
only, a few more add put buying .... some have 1 for 1 provision and
a very few allow put sales and call buying. HAVING SAID THAT you
will have to search to find a firm that allows what you want ....
many firms that say they don't allow it WILL IN FACT ALLOW IT BY
EXCEPTION, which generally means a customer with a history at the
firm.
Bill Bancroft wrote:
> Question for all Registered Reps out there---
>
> Can you: use margin; short sell; trade options in an IRA account?
>
> What is the law?
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