Interactive Brokers (IB) publishes forex accounts profitability – is the largest and most 'profitable' broker
Update: I’ve just confirmed it with IB, their numbers include all clients who’ve traded forex in a given quarter. Since
Update: I’ve just confirmed it with IB, their numbers include all clients who’ve traded forex in a given quarter. Since IB has a massive clients base it means that if someone trades equities for a living and made an fx trade just once in a quarter – they would be included in this list. It explains how come IB has so many clients – most of them are not active forex traders but just traders who’ve traded forex at least once.
Interactive Brokers (IB) is a large broker providing trading services to retail and institutional traders in the stock, options, futures, bonds and the forex markets.
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IB until now, although it was always known that it has a large forex traders base, didn’t release forex profitability statistics just like all other forex brokers do every quarter. This may be because IB is registered as an FCM with the CFTC and not as an RFED. However something prompted IB lately and it now released its profitability figures for the first time. And the result is that IB is apparently the largest forex broker in the US and its clients are the most profitable ones. The question is why? Leverage is pretty much the same as with other US retail forex brokers so perhaps the difference is the average account size.
PERFORMANCE OF INTERACTIVE BROKERS RETAIL CUSTOMER FOREX ACCOUNTS FOR PAST FOUR CALENDAR QUARTERS:
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| Quarter | Forex Accounts | Profitable | Non profitable |
|---|---|---|---|
| Q4 2011 | 45,053 | 51.00% | 49.00% |
| Q3 2011 | 45,058 | 51.20% | 48.80% |
| Q2 2011 | 41,651 | 38.80% | 61.20% |
| Q1 2011 | 40,370 | 40.40% | 59.60% |
The table below sets forth the percentage of non-discretionary retail forex customer accounts maintained by Interactive Brokers LLC that were profitable and unprofitable for the past four calendar quarters. The accounts were identified and these statistics were calculated according to the definitions and interpretations set forth by the CFTC and NFA.
TIME PERIOD NUMBER OF ACCOUNTS PERCENTAGE OF PROFITABLE ACCOUNTS PERCENTAGE OF UNPROFITABLE ACCOUNTS
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
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“And the result is that IB is apparently the largest forex broker in the US” This may only be true on the surface, as every account at IB is “forex-ready” by default, even if the trader is merely indirectly trading FX. For example, if I were trading Eurostoxx futures, my P&L remains in euros, even though I have a USD-based account. P&L conversion is handled manually by the trader as an FX trade thru their IDEAL trading platform (the same platform for margin FX). When you look at the sheer number of global markets IB provides access to, any IB… Read more »
“And the result is that IB is apparently the largest forex broker in the US” This may only be true on the surface, as every account at IB is “forex-ready” by default, even if the trader is merely indirectly trading FX. For example, if I were trading Eurostoxx futures, my P&L remains in euros, even though I have a USD-based account. P&L conversion is handled manually by the trader as an FX trade thru their IDEAL trading platform (the same platform for margin FX). When you look at the sheer number of global markets IB provides access to, any IB… Read more »
Wow, these are very impressive statistics.
Are we certain these are calculated the same as the CFTC-mandate disclosures by other brokerages? The last time we saw such a “profitable” broker it was because Oanda (I think) was counting their # of profitable traders differently than other brokerages.
Wow, these are very impressive statistics.
Are we certain these are calculated the same as the CFTC-mandate disclosures by other brokerages? The last time we saw such a “profitable” broker it was because Oanda (I think) was counting their # of profitable traders differently than other brokerages.
Thanks for the info Michael – so it’s likely some of this forex “profitability” may be traders who place one forex trade, but broadly just benefited from the global equity rally over the past 4 quarters?
i’d say more than 2 weeks, but defo 😉
i’d say more than 2 weeks, but defo 😉
there doesn’t seem to be one, they rely on FXCM’s US stuff probably. interestingly enough: http://www.fxcmmarkets.com/contact-fxcm.jsp
“FXCM Markets also provides toll free numbers for: the United States (855-813-3529), Thailand (001 800 2233 4466), the Dominican Republic (1 888 751 8159), and Venezuela (08001005461).”
there doesn’t seem to be one, they rely on FXCM’s US stuff probably. interestingly enough: http://www.fxcmmarkets.com/contact-fxcm.jsp
“FXCM Markets also provides toll free numbers for: the United States (855-813-3529), Thailand (001 800 2233 4466), the Dominican Republic (1 888 751 8159), and Venezuela (08001005461).”
Thanks for the info Michael – so it’s likely some of this forex “profitability” may be traders who place one forex trade, but broadly just benefited from the global equity rally over the past 4 quarters?
Does this mean IB counted a forex account as profitable if the trader was net profitable overall (in forex, equities, or whatever was traded in the IB account)?
What could possibly account for such high profitability stats vs. all other reporting forex brokers?
Does this mean IB counted a forex account as profitable if the trader was net profitable overall (in forex, equities, or whatever was traded in the IB account)?
What could possibly account for such high profitability stats vs. all other reporting forex brokers?
IB won’t disclose this information unfortunately so we can only guess, i think it’s either counting overall profitability or restriction on leverage. another explanation could be that IB’s traders are not very active one as IB is not a purely retail forex broker therefore they may trade much less frequently and hence lose less.
Why does IB not have to disclose the manner in which they report profitability?
yeah i had a feeling it’s something of this kind…
yeah i had a feeling it’s something of this kind…
Why does IB not have to disclose the manner in which they report profitability?