Interactive Brokers’ volumes continue growth trajectory in November

abdelaziz Fathi

Interactive Brokers LLC (NASDAQ:IBKR) has announced higher trading volumes in November, dwarfing the metrics for October and the same period last year by 20 percent.

Boosted by a rout in US markets. IBKR said the number of fee-generating trades — which includes equities, currencies and commodities — was 2.79 million amid a continued surge in activity from retail investors.

The US-listed brokerage said the number of daily average revenue trades, or DARTS, grew 22 percent year over year from 2.29 million transactions in November 2020. With 387 annualized average cleared DARTs per account, this figure, which reflects one of widely followed industry metrics for customer activity, is also higher 21 percent from 2.26 million transactions set back in October 2021.

IBKR has won more than 60,000 new accounts in November. Total active accounts stood at 1.64 million, or 3 percent higher from 1.58 million accounts in October. The figure was also 58 percent above the previous year’s figure of 1.03 million ‎accounts.

Looking deeper into Interactive Brokers’ latest monthly report, the group’s client margin loans topped $54.4 billion in November. This figure climbed by two thirds against the $39 billion reported in the year prior and was also higher 1 percent from $53.7 billion in October 2021.

On average, in November 2021, Interactive Brokers charged clients commission fees of $2.48 per order, up from $2.27 in October. This figure includes exchange, clearing and regulatory fees, with the key products metrics coming out at $1.62 for stocks, $3.10 for equity options and $4.41 for futures orders.

IBKR reports strong financials despite no-fee trading push

Interactive Brokers’ third-quarter earnings beat analysts’ expectations as the longtime leader in low-cost trading made gains in a couple of key areas, but its headline earnings missed estimates.

Despite headwinds from a push to no-fee trading and historically low interest, Interactive Brokers’ commission revenue increased $32 million, or 11 percent from the year-ago quarter. The upbeat figure was attributed to higher customer trading volumes in stock and options markets.

The results for the quarter were also driven by strong growth in interest revenue, which increased $79 million, or 41 percent on a yearly basis. The increase was supported by higher margin loan balances and strong securities lending activity. However, this was offset by lower revenues in the “other income’ segment, which decreased $199 million.

Aside from its core electronic-brokerage business, the IB earnings for the third quarter included a mark-to-market loss of $185 million from its 7.7 percent stake in Tiger Brokers. This compares to the company’s $6 million float gain, which was tied to the Chinese brokerage in Q3 2020.

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