The electronic brokerage segment at Interactive Brokers LLC (NASDAQ:IBKR), which deals with clearance and settlement of trades for individual and institutional clients globally, said its trading volumes rose in February 2020 by over a third to a new record. The solid metrics came as volatility picked up from multi-year lows in 2019, setting a fresh record high for IB’s Daily Average Revenue Trades (DARTs).
The busiest February on global markets in many years is raising hopes among exchanges and market venues that 2020 will spark a long-awaited rebound in trading metrics. Rising volatility has improved the trading volumes, which hit its lowest levels in six months earlier in October.
During February, the number of DARTs was reported at 1.35 million, the highest figure ever, and a rise of 32 percent month-over-month from 1019,000 in January 2020. Over a year-on-year basis, Interactive Brokers saw a stronger performance in its DARTs with February’s figure jumping 63 percent relative to 824,000 reported in February 2019.
In terms of equity balance in customers’ accounts during February 2020, the figure totaled $170.1 billion, down three percent on a monthly basis from $176.1 billion the previous month. Further, Interactive Brokers bested its February 2019 equivalent, having notched an 18 percent advance relative to $143.7 billion in the prior year.
Interactive Brokers’ ending client margin loan balances also came in at $28.9 billion in February 2020, up six percent month-on-month from $27.3 billion in January 2020. Across a yearly interval, the figure moved higher by 12 percent when weighed against $25.7 billion in February 2019.
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New features yield more volumes
Greater volumes also indicate increased engagement by retail investors following brand new features Interactive Brokers has offered recently. The Greenwich, Connecticut-based company has offered investors the ability to buy and sell fractional shares of almost any US stock. Charles Schwab was the first among US major brokers to roll out the fractional trading, where the brokerage buys the stock and trades fractions of the equity to end clients.
Earlier in October, Interactive Brokers cut trading commissions to zero, setting off a war among brokerages that led almost all competitors to drop fees on virtually the entire exchange-traded products later in the next month.
Business highlights, according to the company’s press release, also showed that a total of 720,000 customer accounts were active at IB during February 2020. The figure was higher by two percent month-on-month when compared to January 2020 (705,000 accounts), and 17 percent higher year-on-year from 606,800 accounts.
On average, in February 2020, Interactive Brokers charged clients commission fees of $3.55 per order, including exchange, clearing and regulatory fees, with the key products metrics coming out at $2.33 for stocks, $5.03 for equity options and $5.44 for futures orders.