Global electronic brokerage Interactive Brokers LLC (NASDAQ:IBKR) has reported its September 2017 trading metrics. An uptick in trading Volatility
Volatility
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
Read this Term helped retain the group’s recently growing volumes, building on last month’s momentum.
Register now to the London Summit 2017, Europe’s largest gathering of top-tier retail brokers and institutional FX investors
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The latest figures benefitted from an obvious increase in volatility and escalation of market activity. A recurring trend in 2017, self-inflicted wounds by the Trump administration coupled with escalating rhetoric from North Korea and focus on the Federal Reserve defined the month.
Despite a shortened trading schedule (20 days in September vs. 23 days in August), Interactive Brokers managed to build on last month’s growth in DARTs.
In particular, the group reported a DARTs figure of 696,000 in September 2017, nearly unchanged month-over-month from 694,000 DARTs set back in August 2017.
The latest DARTs reading is a continuation of a rising trend in H2 2017. An unusually active August has now paved the way for a resurgence of trading volumes in the fall – the first half of the year was characterized by episodic pockets and droughts of volatility.
Looking at a yearly time period, Interactive Brokers’ DARTs were also pointed higher, with a gain of 7.0 percent against September 2016. In terms of its other monthly statistics, the group’s ending client margin loan balances again reached a new high in September, yielding $25.1 billion for the month, which was 3.3 percent higher than $24.3 billion in August 2017.
The company's loan balances have been trending higher every month since September 2016 – the latest figures are 39.0 percent higher year-over-year from September 2016.
New highs in accounts
Moving on to its customer accounts, Interactive Brokers disclosed a figure of 457,000 for September 2017, an all-time high at the brokerage. The number has risen in every month during 2017 as the group continues to expand its market footprint in the United States retail market.
This also correlated to a slight growth of 1.8 percent month-on-month from 449,000 accounts in August 2017 – the figure was even higher relative to September 2016, soaring 23.0 percent year-over-year.
Global electronic brokerage Interactive Brokers LLC (NASDAQ:IBKR) has reported its September 2017 trading metrics. An uptick in trading Volatility
Volatility
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
Read this Term helped retain the group’s recently growing volumes, building on last month’s momentum.
Register now to the London Summit 2017, Europe’s largest gathering of top-tier retail brokers and institutional FX investors
[gptAdvertisement]
The latest figures benefitted from an obvious increase in volatility and escalation of market activity. A recurring trend in 2017, self-inflicted wounds by the Trump administration coupled with escalating rhetoric from North Korea and focus on the Federal Reserve defined the month.
Despite a shortened trading schedule (20 days in September vs. 23 days in August), Interactive Brokers managed to build on last month’s growth in DARTs.
In particular, the group reported a DARTs figure of 696,000 in September 2017, nearly unchanged month-over-month from 694,000 DARTs set back in August 2017.
The latest DARTs reading is a continuation of a rising trend in H2 2017. An unusually active August has now paved the way for a resurgence of trading volumes in the fall – the first half of the year was characterized by episodic pockets and droughts of volatility.
Looking at a yearly time period, Interactive Brokers’ DARTs were also pointed higher, with a gain of 7.0 percent against September 2016. In terms of its other monthly statistics, the group’s ending client margin loan balances again reached a new high in September, yielding $25.1 billion for the month, which was 3.3 percent higher than $24.3 billion in August 2017.
The company's loan balances have been trending higher every month since September 2016 – the latest figures are 39.0 percent higher year-over-year from September 2016.
New highs in accounts
Moving on to its customer accounts, Interactive Brokers disclosed a figure of 457,000 for September 2017, an all-time high at the brokerage. The number has risen in every month during 2017 as the group continues to expand its market footprint in the United States retail market.
This also correlated to a slight growth of 1.8 percent month-on-month from 449,000 accounts in August 2017 – the figure was even higher relative to September 2016, soaring 23.0 percent year-over-year.
