Interactive Brokers' May Metrics Improve Y/Y - Analyst Blog

Interactive Brokers Group, Inc.'s IBKR Electronic Brokerage segment recorded a year-over-year increase in brokerage metrics for May 2014. The segment clears and settles trade globally for both individual and institutional clients.

Total customer Daily Average Revenue Trades (DARTs) were 518,000, up 2% from May 2013 but down 10% from Apr 2014. Further, total customer accounts climbed 16% from the prior-year month and 1% from the prior month to 258,900.

Interactive Brokers recorded Cleared Customer DARTs of 478,000, up 3% from May 2013 but down 9% from Apr 2014. Further, on an annualized basis, Cleared Average DARTs per customer account of 466,000 decreased 12% from the comparable prior-year period and 10% from the prior-month level.

Interactive Brokers' total option contracts came in at 20.6 million, down 11% from the year-ago month and 12% from the prior-month level. Moreover, future contracts decreased 18% from May 2013 and 12% from Apr 2014 to 8.1 million.

Interactive Brokers also provides data related to period-end statistics for customer equity, customer credit balances and customer margin loan balances. For the period ended May 2014, customer equity was $51.0 billion, rising 35% year over year and 3% from the prior-month.

Further, Interactive Brokers recorded customer credit balances of $27.8 billion in the reported month, up 22% from May 2013 and 3% from Apr 2014. Additionally, the company's customer margin loan balance of $14.8 billion rose 33% from May 2013 and 1% from Apr 2014.

What Lies Ahead?

While the overall equity market was volatile in April, it rebounded strongly in May. Further, the month of June has also begun on a bullish note. Though a consistent performance of the equity market cannot be assured, with gradual recovery in the economy we do not foresee any major deterioration in the scenario.

The Greenwich, CT-based broker is well positioned to gain from either continued rebound or volatility in the equity market. Therefore, in continuation of the trend in the trailing few quarters, further improvement in Interactive Brokers' trading activities will keep boosting its top line.

Currently, Interactive Brokers carries a Zacks Rank #1 (Strong Buy). Other investment brokers worth considering include E*TRADE Financial Corp. ETFC, Investment Technology Group Inc. ITG and Piper Jaffray Companies PJC. All these stocks have the same Zacks Rank as Interactive Brokers.

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