Interactive Brokers charges higher fees in September as clients margin tops $50B

abdelaziz Fathi

The electronic brokerage segment at Interactive Brokers LLC (NASDAQ:IBKR), which deals with clearance and settlement of trades for individual and institutional clients globally, today reported a mild rebound in trading volumes for the month ending September 2021.

Interactive Brokers said the number of fee-generating trades hit 2.260 million. That is 16 percent higher than the number of daily average revenue trades, or DARTS, reported in the same month a year ago. Additionally, the US-listed brokerage saw its DARTs increasing by 4 percent from the 2.17 million trades set back in August 2021.

In February, the discount broker’s DARTs hit an all-time high of 3.7 million amid a surge in activity from people stuck at home during the coronavirus pandemic.

IBKR has won more than 43,000 new accounts in September. Total active accounts stood at 1.54 million, or 4 percent higher from 1.49 million accounts in August. The figure was also 57 percent above the previous year’s figure of 981,000 ‎accounts.

IBKR and other brokers saw their client base balloons as volatile markets and renewed stay-at-home restrictions amplified interest in trading from retail investors.

Looking deeper into Interactive Brokers’ latest monthly report, the group’s client margin loans topped $50 billion in September 2021. This figure climbed by two thirds against the $30 billion reported in the year prior and was also higher 1 percent from August 2021.

On average, in September 2021, Interactive Brokers charged clients commission fees of $2.58 per order, up from $2.39 in August. This figure includes exchange, clearing and regulatory fees, with the key products metrics coming out at $1.82 for stocks, $3.70 for equity options and $4.25 for futures orders.

Interactive Brokers has been in the news lately for two different reasons. The first one was the launch of low-cost cryptocurrency trading to its clients via partnership with New York-based exchange and stablecoin issuer, Paxos.

In particular, IBKR has partnered with Paxos to enable customers to buy, hold and sell a handful of crypto assets at a commissions of just 0.12% – 0.18% of trade value, with a $1.75 minimum per order. Plus, there are no added spreads, markups, or custody fees.

Also this week, the company agreed to pay $1.75 million to settle the Commodity Futures Trading Commission’s charges that its platform failed to handle oil’s trip into negative pricing in April 2020. The order order included a restitution obligation of $82.57 million (a portion of the $102 million already paid) and the CFTC has acknowledged that IBKR’s previous payments satisfy obligations owed its customers as a result of its systems issues.

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