Interactive Brokers' February Metrics Rise - Analyst Blog


An overall improvement in the equity market continues to benefit Interactive Brokers Group, Inc. ( IBKR ), as the company's Electronic Brokerage segment witnessed year-over-year improvement in brokerage metrics for Feb 2014. The segment clears and settles trade globally for both individual and institutional clients.

Total customer Daily Average Revenue Trades (DARTs) were 581,000, up 19% from 488,000 in Feb 2013 and relatively unchanged from 583,000 in Jan 2014. Further, total customer accounts climbed 15% from the prior-year month and 2% from the prior month to 247,300.

Interactive Brokers recorded Cleared Customer DARTs of 526,000, up 18% from Feb 2013 but down nearly 1% from Jan 2014. Further, on an annualized basis, Cleared Average DARTs per customer account of 538,000 increased 3% from the comparable prior-year period but declined 2% from the prior-month level.

Interactive Brokers' total option contracts increased 18% from the year-ago month but decreased 11% from the prior-month level to 23.0 million. Moreover, future contracts declined 4% from Feb 2013 and 15% from Jan 2014 to 7.9 million.

Interactive Brokers also provided data related to period-end statistics for customer equity, customer credit balances and customer margin loan balances. For the period ended Feb 2014, customer equity was $48.6 billion, rising 40% year over year and 6% from the prior-month figure.

Further, Interactive Brokers recorded customer credit balances of $26.3 billion in the reported month, increasing 17% from Feb 2013 and 3% from Jan 2014. Additionally, the company's customer margin loan balance of $14.3 billion at the end of Feb 2014 rose 28% from Feb 2013 and 3% from Jan 2014.

Now, can we expect further improvement in Interactive Brokers' trading business in the following months? Well, a lot depends upon how the overall economy performs. The benchmarks have been showing uptrend recently, but the sustainability of this trend is a concern given the still sluggish economic improvement and political upheavals.

With the recent news of Russian troops advancing in Ukraine, we find the global political scenario to be strained, thereby negatively impacting the stock price worldwide. The three major U.S. stock indexes (S&P 500, Dow Jones Industrial Average and NASDAQ-100) were down by nearly 1% at the end of the trading day on Mar 3. If the downward movement continues, it will weigh heavily on the trading activities of companies like Interactive Brokers.

Currently, Interactive Brokers carries a Zacks Rank #3 (Hold).

However, some better-ranked investment brokers include Investment Technology Group Inc. ( ITG ), LPL Financial Holdings Inc. ( LPLA ) and GAIN Capital Holdings, Inc. ( GCAP ). All these stocks sport a Zacks Rank #1 (Strong Buy).

GAIN CAP HLDGS (GCAP): Free Stock Analysis Report

INTERACTIVE BRK (IBKR): Free Stock Analysis Report

INVEST TECH-NEW (ITG): Free Stock Analysis Report

LPL FINL HLDGS (LPLA): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: GCAP , IBKR , ITG , LPLA

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