Electronic brokerage firm Interactive Brokers LLC (NASDAQ:IBKR) said its trading volumes fell slightly in July from a month earlier as traders took their summer breaks and volatility approached seasonal lows.
Volumes were higher on a yearly basis when volatility was less than its current levels. However, since most central banking are taking a dovish approach in 2019, and interest rates stay low globally, investors have little incentive to take positions, and it became more difficult to find arbitrage opportunities between even the most liquid assets.
During July 2019, the number of DARTs was reported at 800,000, which is lower one percent month-over-month from 808,000 in June 2019. Over a year-on-year basis, Interactive Brokers saw its DARTs up in July by over seven percent relative to 748,000 reported in July 2018.
In terms of equity balance in customers’ accounts during July 2019, the figure totaled $155.6 billion, up two percent on a monthly basis from $153.1 billion the previous month. Interactive Brokers also bested its July 2018 equivalent, having notched a 13 percent advance relative to $138.2 billion of the prior year.
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Interactive Brokers’ ending client margin loan balances also came in at $26.5 billion in July 2019, higher by three percent month-on-month from $25.7 billion in June 2019. Across a yearly interval, the figure moved lower by six percent when weighed against $28.2 billion in July 2018.
Business highlights, according to the company’s press release, also showed that a total of 652,000 customer accounts were active at IB during July 2019. The figure was higher by one percent month-on-month when compared to June 2019 (645,000 accounts), and 17 percent higher year-on-year from 555,000 accounts.
On average, in July 2019 Interactive Brokers charged clients commission fees of $3.61 per order, including exchange, clearing and regulatory fees, with the key products metrics coming out at $2.25 for stocks, $5.03 for equity options and $5.73 for futures orders.
The Greenwich, Connecticut-based company said earlier last month that its net revenues for Q2 2019 amounted to $413 million, lower by seven percent compared with $445 million in the same period last year. Income before tax totaled $225 million, down 17 percent year-over-year (from $271 million).
Aside from its core electronic-brokerage business, the IB earnings for the second quarter included a $74 million float loss from its 7.7 percent stake in the Chinese brokerage Tiger Brokers which raised $104 million from its IPO on Nasdaq stock exchange.