Private equity investments can range from partnerships investing in a real estate venture to high-risk, high-reward investments in start-ups. It all depends on when you plan to retire and how you want to diversify your portfolio.
Private equity investments are commonly formed when raising capital for:
Private start-up company stock
De novo bank stock or bank capital raise
Expansion of an existing company
Acquisition of an entity
Purchase of a commercial real estate property
Building of a multifamily residential complex
Oil & gas or energy ventures
Hedge fund investments
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Advantages of private equity investing
Investing in private equity certainly isn’t for everyone, but for those who are particularly knowledgeable in their field or have a knack for spotting companies on the rise, private equity can make a great addition to your retirement portfolio.
The ability to turn your personal knowledge into an investment for your future
The choice to tap your IRA when an opportunity arises to invest in private companies and entities
Diversification of your retirement portfolio
Buy, sell and exchange equity without tax consequences
How to invest in private equity
There are three primary ways to invest in private equity through a self-directed IRA at STRATA Trust Company:
Private company stock of a closely held corporation
Private limited partnership
Private limited liability company (LLC investments must be multi-member; single-member LLCs are not permitted.)