Interactive Brokers Tops One Million Users, DARTs Down 10% MoM

On average, in October 2020, Interactive Brokers charged clients commission fees of $2.49 per order.

Interactive Brokers LLC (NASDAQ:IBKR) saw 1.762 million daily average revenue trades, or DARTS, in October 2020 compared to 1.953 million transactions in the prior month.

Although the figure is higher by nearly 120 percent on a yearly basis, the listed broker saw this metric down by 10 percent relative to its September counterpart. Interactive Brokers is hardly the only platform seeing such strong growth this year as all of its publicly traded rivals have also doubled their trading volume from their 2019 totals.

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Though most US brokers now offer commission-free trades on almost all exchange-traded products, the so-called DARTs are still a key brokerage industry standard for measuring their clients’ activity.

Furthermore, Interactive Brokers won more clients with total October’s active accounts crossing the one million milestone for the first time in the company’s 42-year history. This figure is also 3 percent higher from 981 thousand client accounts the previous month, and up 50 percent year-over-year when compared to October 2019.

Looking deeper into Interactive Brokers’ latest monthly report, the group’s ending client margin loan balances were around $31.7 billion in October 2020. This figure climbed 6 percent from $30.0 billion in September 2020 and was also higher by nearly 25 percent against the year prior.

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On average, in October 2020, Interactive Brokers charged clients commission fees of $2.49 per order, relative to $2.55 in September. This figure includes exchange, clearing and regulatory fees, with the key products metrics coming out at $1.75 for stocks, $3.84 for equity options, and $3.67 for futures orders.

Earlier in October, Interactive Brokers reported third-quarter earnings that beat analysts’ expectations as the longtime leader in low-cost trading made gains in a couple of key areas, but its adjusted earnings missed estimates.

Ranked as the largest US electronic broker by some measures, Interactive Brokers’ third-quarter revenues rose 17 percent year-over-year, to $548 million compared to $466 million in Q3 2019. Further, the figure was higher from $523 million in the second quarter.

However, on an adjusted basis Interactive Brokers saw a drop in key metrics amid continued revenue fallout from low interest rates. The listed brokerage earned adjusted profits of $304 million for this quarter, or 53 cents per share, is down 10 and 7 percent, respectively, from $340 million and 57 cents for the third quarter of 2019. Adjusted net revenues also fell to $518 million, about -1.3 percent less than the $525 million it booked in the same period a year ago.

Despite headwinds from a push to commission-free trading and historically low interest, Interactive Brokers’ other income segment increased $76 million from a year ago.

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