Abstract：Despite a multitude of trading incentives that Interactive Brokers LLC (NASDAQ:IBKR) introduced over the past few years, including commission-free trading and fractional shares, monthly volumes are struggling for any real traction.
IBKR reported today its lowest DARTs since October 2020, with 2.01 million transactions in June. This compares to 2.29 million daily average revenue trades, or DARTS, in May 2022, a 12% decrease month on month. On a year-over-year basis, the electronic brokerage firm saw an 18% increase in comparison to June 2021 metrics.
IBKR had 1.92 million active customer accounts in June 2022, a 2% increase month over month and a 36% increase year over year. At this rate, Interactive Brokers will reach the two million customer mark for the first time in the company's 44-year history.
The data show that the trend of increasing account numbers is still in play, despite the interruption in volumes. It is unclear whether this will be sufficient to support revenue growth after the publicly traded discount broker reported lower earnings for the three months ending March 2021.
By some measures, Interactive Brokers is the largest US electronic broker, but its first-quarter adjusted revenues fell 27 percent year on year, to $645 million from $893 million in Q1 2021.
In terms of margin loans in customer accounts in June 2022, the figure totaled $42.6 billion, a 4% decrease from May and a 13% decrease from the previous year.
IBKR had a hectic month.
The Greenwich, Connecticut-based company also revealed that it charged clients $2.96 in commission fees per order on average. The exchange, clearing, and regulatory fees are included in this figure, with the key product metrics coming in at $2.18 for stocks, $3.98 for equity options, and $3.80 for futures orders.
Interactive Brokers is one of the few platforms experiencing such sluggish performance this year, despite the fact that most of its publicly traded rivals and retail platforms have more than doubled trading volume from 2021 totals.
In recent weeks, Interactive Brokers has been in the news. The company launched the fractional trading feature for European stocks and ETFs in May, three years after it first launched for US securities in 2019.
The move, aimed at attracting more young clients, removes the obstacles that many investors face when attempting to invest in a diversified portfolio of listed securities. Investors can diversify their investment portfolios through fractional share trading by spreading their relatively small capital across a broader range of stocks.
TradingView has also added the latest online trading partner, a US-listed brokerage firm. TradingView will now be accessible directly from Interactive Brokers accounts, providing users with numerous benefits such as an integrated trading terminal and other tool suites. With the soft launch, investors will be able to trade futures and stocks, with additional asset classes coming soon.
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