To invest in stocks, bonds, funds, or ETFs in your Solo 401k plan, you must have a brokerage account specifically for 401k funds.

See more here: How do I open a brokerage account with my Solo 401k?

It's important to remember you're not opening a new 401k. Rather, your 401k plan and trust are opening an investment-only account with the brokerage firm or financial institution.

Each brokerage firm has their own process to opening a compatible brokerage account to hold your Solo 401k funds.

See the guides below on some of the most popular brokerage firms:

Futures are not significantly different from stocks. Futures trading involves buying and selling contracts for what the price will be in the future. This might include markets such as agricultural commodities, foreign currency, metals, and other items where the price fluctuates from day-to-day. Because your Solo 401k gives you complete control of your investment choices, it does allow futures and futures options trading.

It’s possible, but there are many obstacles (not specifically imposed by Nabers Group). Theoretically, the problem is that short sales have unlimited risk. Shorting stocks involves borrowing the shares and then selling for cash only to buy back the same number of shares right before returning them to the lender. If the stock goes down in the interim, the investor pockets the difference. However, the profit on a margin account may trigger UBIT.

On the other hand, the unlimited risk is based on the fact that the cost to buy them back could go up an unlimited amount. There is no limit to how much it could cost you to buy back the shares to return them to the lender. For that reason, most brokers will not allow retirement accounts to short sell. Also, there is some indication the IRS wants to prohibit short sales because of the unlimited risk.

Uncovered calls are also known as “naked calls.” This is another high-risk strategy because of the possibility that the account could go into negative territory and need money to cover the call (that it does not have).

It is especially risky for 401k and IRA accounts because of contribution limits that might prevent you from paying the amount owed. You cannot personally guarantee an uncovered call with non-retirement funds. No broker wants to be in the position where you could owe money but not be able to repay it.

Remember, your Solo 401k is completely separate from your personal finances, so you can’t personally repay the money. It’s a similar situation to shorting stocks.

Long-Term Equity Anticipation Securities (LEAPS) are options with expiration dates ranging from nine months to three years into the future. Because these are options without owning the security, give the same consideration to UBIT rules. LEAPS are the same as the options already discussed. Therefore, the only real difference is the length of time you hold the LEAPS. LEAPS can even be for an almost unlimited amount of time. Accomplish this by selling one LEAP position about to expire. Then, purchase a replacement LEAP with an expiration date further into the future. Because of the long lengths of time, these can sometimes be highly profitable.

Disclaimer: Investing inherently involves risk. Nabers Group and its affiliates, subsidiaries, or partners are not investment advisors, and we do not offer investment advice. Always complete your due diligence before executing any investment and check with your CPA, legal counsel, or tax advisor before executing investments using retirement funds.