SIE practice questionhardTrading on Margin in Retirement Accounts
Which account prohibits the use of margin for purchasing securities?
- AIndividual Retirement Account (IRA)✓ Correct answer
- BCash account
- CMargin account
- DJoint tenants with rights of survivorship account
Explanation
Why A — Individual Retirement Account (IRA)
IRAs, by regulation, prohibit the use of margin. Cash accounts require full payment but can convert to margin; margin and JTWROS accounts may allow margin if so specified.
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