Interactive Brokers’ trading volume hits lowest since August 2020

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.

During December 2022, the number of DARTs was reported at 1.751 million transactions, down from 1.96 million transactions in the month of November. Over a year-on-year basis, Interactive Brokers saw a larger drop in its DARTs with December’s figure down by 21 percent relative to 2.23 million reported in December 2021.

In terms of equity balance in customers’ accounts during December 2022, the figure totaled $306.7 billion, down by 18 percent on a yearly basis. Interactive Brokers also failed to best its November equivalent, having notched a three percent fall relative to the prior month.

Elsewhere, the discount brokerage has won more than 25,400 new accounts. December’s active accounts increased to 2.09 million, or 1 percent higher from November and 25 percent above the previous year’s figure of 1.67 million ‎accounts.

The Greenwich, Connecticut-based company also revealed that on average it charged clients commission fees of $3.17 per order. This figure includes exchange, clearing and regulatory fees, with the key product metrics coming out at $2.23 for stocks, $4.53 for equity options and $3.87 for futures orders.

The data shows that the trend of rising accounts number is still in play, though volumes were interrupted. It is not clear whether that will be enough to support the revenue growth in the fourth quarter after the listed discount broker reported solid earnings for the three months through September 2021.

Ranked as the largest US electronic broker by some measures, Interactive Brokers’ third-quarter adjusted revenues rose 30 percent year-over-year, to $847 million compared to $650 million in Q3 2021.

On an adjusted basis, income before tax totaled $580 million, up 38 percent year-over-year from $420 million in the previous year. Diluted earnings per share came in at $1.08 for this quarter compared to $0.78 in Q3 2021.

Interactive Brokers had been in the news over the past few weeks. Most recently, it joined a group of thirteen firms that bought minority equity interests in the Cboe Digital business. Their equity ownership will allow them to directly benefit from the growth of Cboe Digital and close strategic and commercial alignment. Investor partners join a roster of commercial partner firms supporting the Cboe Digital business.

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