Prohibited Investments in a Traditional IRA

Does the ‘alternative investment’ list of prohibited investments that list items like some debt finance income be an issue in any standard brokerage funds like REITS or Diversified Read Asset Funds if they say fund may invest in REITS, ETFs and other investment pools? Noticed some standard index type funds / ETF funds include a list that includes ‘Real Estate’ or Diversified Real Asset Funds that may invest in debt securities and derivatives and may include currencies, derivative’s and hold positions in debt securities and derivatives. If a standard ETF index fund or a mutual fund % of this investment is low on the list, it is not considered an alternative investment that is prohibited in a Traditional IRA? I just want to be sure.

thank you in advance



Small amounts are not a problem, and sponsors of most index funds and ETFs would not want to offer a product that could not be held in IRAs as that would  subtrantially limit their marketplace. However, if you encounter some funds specializing in such holdings, you should avoid them without a written statement in the prospectus that indicates they can be purchased in an IRA. For example, if you did not know what was backing the gold ETF GLD, you would want to look into that and then you would find that it was backed by gold bullion which is approved for IRAs and I believe so stated in the prospectus.



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