Interactive Brokers reports mild increase in client trades for May

abdelaziz Fathi

Interactive Brokers LLC (NASDAQ:IBKR) saw 1.86 million daily average revenue trades, or DARTS, in May 2023 compared to 1.77 million transactions in the prior month. The figure is 5 percent higher on a monthly basis, but dropped by more than 19 percent from a year earlier.

In terms of equity balance in customers’ accounts during May 2023, the figure totaled $345 billion, higher by 10 percent on a yearly basis. Interactive Brokers also managed to beat its April equivalent, having notched a 1 percent increase relative to $331.6 billion the prior month.

Elsewhere, the discount brokerage has won more than 33,900 new accounts. May’s active accounts increased to 2.26 million, or 2 percent higher than in April and 19 percent above the previous year’s figure of 1.89 million ‎accounts.

The Greenwich, Connecticut-based company also revealed that on average it charged clients commission fees of $3.08 per order compared to $3.18 in April. This figure includes exchange, clearing and regulatory fees, with the key product metrics coming out at $1.95 for stocks, $4.43 for equity options and $4.36 for futures orders.

Interactive Brokers made headlines recently following the launch of low-fee cryptocurrency trading for professional investors in Hong Kong, making it the latest by the discount broker to expand the reach of its digital asset offering.

Interactive Brokers reported last month its largest-ever quarterly profit, buoyed by a favorable interest rate environment and an increasing user base.

The discount broker posted strong first-quarter earnings led by a recovery in interest income and its investment in Tiger Brokers. However, IBKR’s commission revenue was muted due to higher operating expenses and lower customer stock trading volume.

Ranked as the largest US electronic broker by some measures, Interactive Brokers’ first-quarter revenues rose 63 percent year-over-year, to $1.04 billion compared to $645 million in Q4 2022.

On an adjusted basis, income before tax totaled $720 million, up by nearly two thirds year-over-year from $441 million in the previous year. Diluted earnings per share came in at $1.35 for this quarter compared to $0.82 in Q4 2022.

Despite headwinds from a push to no-fee trading, Interactive Brokers’ commission revenue increased 2 percent from the year-ago quarter to $357 million. The growth was attributed to customer’s futures trading volume and higher options commission per contract. However, the figure was tempered partially by lower stock volume.

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