Benefits of Investing in Hedge Funds With a Self- Directed IRA
Self directed IRAs provide tax-sheltered retirement income on returns and investments.
Hedge funds are complex investment funds that use the concept of trading liquid assets. The fund constructs intricate techniques and risk management strategies to help improve portfolio performance. Typical techniques involve leverage, short selling, and derivatives. They almost always have a fund manager. Although designed for the more experienced and accredited investors, these investments are allowed in self-directed retirement plans.
Self-directed IRA investors can use account cash to purchase shares. Investing can provide the account holder with a tax-sheltered retirement income and returns. It also offers widespread diversity for their retirement portfolio.
Hedge funds are subject to regulation by the US Securities and Exchange Commission (SEC) and/or the appropriate state securities administrator. Investors should retain independent financial and/or legal counsel to evaluate the risks and merits of investments in any fund before investing.
The SEC recently expanded its definition of an accredited investor.