Exchange-Traded Investments in Your PENSCO Retirement Account

As a PENSCO client, you can invest in exchange-traded investments (stocks, bonds, etc.) through a broker/dealer of your choice as long as they accept third party brokerage accounts. Please check with your broker.

Why you may want to hold a brokerage account in a PENSCO retirement account

Having a brokerage account in an IRA isn't for everyone. If you want faster access to transferring funds between your brokerage and PENSCO accounts or if you're an active investor, this might be a useful option. Here's why:

Ease of management

Holding a brokerage account at PENSCO may allow the client to view the entire retirement portfolio at once, and to receive consolidated statements.

Speed of transfer

With the trading account inside the PENSCO retirement account, funds can be moved quickly and easily between traded (or public) investments and non-traded investments such as real estate or private placements.

Cost effectiveness

Because the need to transfer funds between institutions is eliminated, the typical $50 fee for a partial transfer out from PENSCO can be avoided. Instead, adding additional cash (e.g., incoming dividends, etc.) to a trading account held in your PENSCO account becomes a free transaction.

However, be aware that you may incur fees from your broker / dealer and from PENSCO for this account. Please check before opening a brokerage account in your retirement account. Again, this option may be best for active investors who typically make many trades or need to move assets quickly.

How it works

Currently, PENSCO works with a number of broker/dealers, whereby PENSCO establishes brokerage accounts on behalf of its clients at the clients' broker/dealer of choice, as long as the firm accepts third party accounts. You'll need to confirm with your broker. These brokerage accounts are then held as an asset within the clients' PENSCO retirement accounts. For example, the registration on the account reads "PENSCO Trust Company, custodian FBO* "client name", IRA". In this way, the brokerage account is part of the overall PENSCO client account.

* For Benefit Of

How does a PENSCO client initiate a public trade?

PENSCO clients can deal directly with the broker with most brokers in buying and selling securities (e.g., without going through PENSCO to effect the transaction).

Mutual funds in a PENSCO IRA

We can also buy mutual funds for our clients directly. PENSCO does not charge a commission for doing so, and you can purchase any of more than 4,000 funds.

Learn how to open a brokerage account or buy a mutual fund in your PENSCO IRA

Something to be wary of

Don't assume that an investment published in a public newspaper is necessarily a "public investment". Some of these investments are limited private investments which may be violating securities regulations by publishing to the general public without having filed as a registered investment.

PENSCO's non-advisory role

As a regulated custodian, PENSCO can acquire or liquidate public investments for you directly (CDs, treasury bills) or indirectly (stocks/bonds through a brokerage account). However, PENSCO can't advise you as to investment strategies nor sell you investments.

This information is for general informational purposes only and is not intended as an individualized recommendation or to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, PENSCO recommends consultation with a qualified tax advisor, CPA, financial planner or investment manager. PENSCO performs the duties of a custodian and, as such, does not provide investment advice or sell investments, nor offer any tax or legal advice.