What could impact Q2 2018?
E*TRADE Financial Corp. (ETFC), one of the leading brokerage firms, reported its metrics for April 2018 yesterday. In the first quarter, the company saw significant trading volumes, primarily due to increased volatility.
E*TRADE, as well as its competitors like TD Ameritrade Holding (AMTD), Charles Schwab (SCHW), and Interactive Brokers Group (IBKR) are expected to experience a decline in their trading revenues in June 2018, primarily due to reduced volatility. A decline in trading revenues might impact their total revenues for the quarter.
April 2018 metrics
In April 2018, E*TRADE witnessed daily average revenue trades (or DARTs) of 249,939, which equates to a decline of 12% from March 2018 and an increase of 28% from April 2017. Of the total DARTs in April 2018, 35% were derivatives DARTs. E*TRADE saw gross new brokerage accounts of 188,056 in the last month, which reflects a substantial rise from March 2018, primarily due to its acquisition of Trust Company of America. Thus, as of April 2018, the company had brokerage accounts of around 3.9 million.
E*TRADE saw a decline of 1% in customer margin balances to $10.4 billion in April 2018 from March 2018. However, the number reflects an increase of 39% YoY. The company’s net new brokerage assets in April 2018 amounted to $18.2 billion.