E*TRADE Financial Corporation (NASDAQ: ETFC) has just released its monthly metrics report for May 2017. Despite isolated pockets of volatility throughout 2017, last month featured several market drivers that collectively bolstered trading volumes and Daily Average Revenue Trades (DARTs).
Indeed, May 2017 was not short of market moving events, with North American markets experiencing one of the more active periods all year. In the US, the financial markets digested a string of political scandals and self-inflicted drama brought by the Trump administration. Consequently, stock markets that had previously recoiled to monthly lows managed to bounce upwards by months’ end en route to establishing fresh all-time highs.
E*TRADE’s May 2017 volumes followed a well-established trend, at least in terms of US venues and exchanges during the month. The majority of brokerages all saw volumes pointed higher as markets shook off a tranquil April. Also helping the case was an increase of trading days in the month of May – 22 compared to just 19 in April – which further added to growing volumes.
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Looking at its latest statistics in May 2017, E*TRADE’s DARTs were reported at 211,516, rising by a factor of 7.9 percent month-over-month from 196,022 in April 2017 – incidentally, a 2017 low. April proved to be one of the slowest trading months of the calendar year, also hurt by having a shortened trading schedule of only 19 days. Over a yearly interval, E*TRADE’s May 2017 DARTs were also on the uptick, as indicated by a surge of 41.5 percent year-over-year, compared to a figure of 149,475 DARTs set back in May 2016.
Increased Account Growth
Delving into this yearly trend, the US brokerage scene as a whole have been experiencing a solid 2017, helped by a general retreat in trading commissions that has steadily reeled in more clients. TD Ameritrade, Fidelity Investments, and other venues have all looked to lower the costs of trading – the results being a rise of new accounts as many newer investors have been enticed by eroding fees. This reflected a gain of 20,415 net new brokerage accounts in May 2017, easily besting a figure of 8,448 net new brokerage accounts in May 2016, or 141.6 percent gain year-over-year.
The group’s large number of new accounts has also been a recurring trend in 2017. Even on a monthly basis, E*TRADE recorded a strong month in this segment, securing a total of 67,099 total gross new accounts (aggregating brokerage, stock plan, and banking accounts) – this registered a gain of 7.5 percent month-over-month from 62,432 accounts in April 2017.
E*TRADE’s customer margin balances trended higher in May 2017, as indicated by a reading of $7.7 billion, up 2.6 percent month-over-month from $7.5 billion in April 2017. A more pronounced gain was seen relative to 2016, with the latest figures signaling an advance of 18.4 percent year-over-year from $6.5 billion in May 2016. Finally, E*TRADE’s customer security holdings yield a figure of $253.4 million during May 2017, up 2.1 percent month-over-month against $248.3 million set in April 2017.
Looking ahead to the month of June, financial markets in the US have already had a plethora of events to help steer their trajectory. A decision from the US Federal Reserve looms as the marquee event of the month, though markets have also already endured a pullback in the technology sector across US stocks, as well as a testimony from James Comey that could yet spark a reaction from President Trump, whose administration is already embattled in multiple probes.