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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Boca_PETE who wrote (8205)	8/29/1999 12:17:00 PM
From: Boca_PETE	Respond to of 15132

Ron: RE: <More on Shorting Stocks in an IRA > Suppose you started an IRA for $2000 in 1999 (the max you can contribute each year). Suppose you could short stocks in an IRA account and did for $2000. And suppose the stock went up (instead of down) and you failed to cover until you lost $10000 on the transaction. Since you are legally prohibited from putting more that $2000 per year into the IRA account, how could you legally cover the loss on the shorted stock in your IRA account? If you put more than $2000 into the account, you'd get clobbered for all sorts of tax penalties in addition to the $8000 loss on the transaction - WHAT A MESS YOU'D HAVE ON YOUR HANDS. Now you know why you're not permitted by law to short stocks in an IRA account. End of story. P