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Zecco.com » General Investing » Margin Trading » Margin, Daytrading, & IRAs
Last post 05-10-2008, 12:15 AM by Stardust. 1 replies.
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  •  05-09-2008, 10:56 PM 28839

    Margin, Daytrading, & IRAs

    Reply Quote
    Reading in the forums I found this:
    "Is your account an IRA or Roth IRA?   Since these account types can't be flagged, perharps, you just found a loophole."

    Is this true?  Are IRA's really not able to be flagged as PDTs?  If not why don't more people trade that way with less than $25k?  What are the disadavatages of an IRA account as opposed to a regular account?  Are they taxed differently?  Thanks.

  •  05-10-2008, 12:15 AM 28841 in reply to 28839

    Re: Margin, Daytrading, & IRAs

    Reply Quote
    Yes, it's true according to the NASD/NYSE rules.  Because an  IRA or Roth IRA is a cash account (not a margin account), it can't be flagged as a Day Trading account.  Therefore, you can day trade all you want in the cash account.  However, since all transactions require 3 days to settle, you can't really day trade much.   I suppose the only disadvantage is that you have to wait for 3 days for your transactions to settle/clear before you can trade again.
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