Traditional IRAs and Roth IRAs often are mentioned in the same breath because of their similarities and the advantages they offer. But choosing one over the other without doing further research could end up being a costly decision. Both Traditional and Roth IRAs offer advantages, but those advantages differ and how you choose to invest will depend a lot on your personal financial situation and long-term goals. If you're a bit more aggressive and you want to trade in your Traditional and Roth IRA account(s), there are some other facts you need to know. (For more, see: New Rules for IRA Holders in 2015.)

The money contributed to a Traditional IRA is pre-tax. You can trade all you want without any near-term tax consequences, but earnings distributed will be treated as ordinary income when you withdraw your money. Because of Internal Revenue Service rules, you cannot borrow to trade in any type of IRA account. This means no short selling. While you can purchase leveraged and inverse exchange-traded funds to short almost anything, this comes with great risk, and these are tools that should only be used by those with trading experience. The same rule applies to volatility ETFs, which can be even riskier. (For more, see: Can I Buy Mutual Funds for My IRA?)

If you withdraw your money early from a Traditional IRA, you likely will be hit with a 10% tax penalty. The only way to avoid this penalty is if you're using the money for a first-time home purchase, as a qualified education expense, due to death or disability, for unreimbursed medical expenses, or for health insurance if you're unemployed. (For more, see: How Much are Taxes on IRA Withdrawals?)

If you want to avoid that penalty, then you need to wait until you're 59½ years old. You can withdraw without penalty until you're 70½ years old. At that time, you're required to start taking withdrawals, which is referred to as the required minimum distribution, or RMD. Regardless of when you withdraw, any gains will be treated as ordinary income. This will be based on the year you withdraw and the current income tax rate. (For more, see: Six Important Retirement Plan RMD Rules.)

A potential advantage to a Traditional IRA is that contributions may be deductible, depending on tax-filing, active-participant status, and income amount. (For more, see: Traditional IRA Deductibility Limits.)

With a Roth IRA, you're investing with after-tax dollars. Therefore, there will be no federal income tax on withdrawals. The same trading rules as above apply. Generally, you can stick to stocks, bonds and ETFs without borrowing. (For more, see: Can I Buy ETFs for My Roth IRA?)

Like a Traditional IRA, if you withdraw early, you likely will be hit with a 10% tax penalty. In order to avoid this, your money must have been invested in the Roth IRA for a minimum of five years and you must meet one of the following requirements: 59½ years of age, death or disability, or qualified first-time home purchase. Roth IRA contributions are never deductible, but the tax-free withdrawals are a big advantage. (For more, see: Best Roth IRA Stocks for 2015.)

For both Traditional IRAs and Roth IRAs, the maximum annual investment allowed is $5,500 if you're younger than 50. If you're 50 or older, the maximum annual investment allowed is $6,500. (For more, see: Converting Traditional IRA Savings to a Roth IRA.)

Overall, investing in a Roth IRA is likely to have more long-term advantages. That said, this doesn't apply to every investor. Your personal financial situation and long-term investment strategy and goals should play the biggest role in your decision. Of course, it's possible to split your money between a Traditional IRA and a Roth IRA, which is a form of diversification. Please consult your financial advisor prior to making any investment decisions. (For more, see: Roth vs. Traditional IRA: Which is Right for You?)