In the second quarter, Interactive Brokers Group (IBKR) saw daily average revenue trades (or DARTs) of 797,000 compared to 939,000 in the first quarter. The sequential fall of 15% was primarily due to lower movements in the broader markets mainly due to a settlement between the US and North Korean and the May 2018 jobs report, which reported an unemployment rate of only 3.8%. The company’s DARTs fell despite a rise of 5% in total accounts to 542,000 on a sequential basis.
In the March quarter, competitors (VFH) E*TRADE Financial (ETFC) and TD Ameritrade Holding (AMTD) recorded DARTs of 309,469 and 943,058, respectively. Sequentially, Charles Schwab’s (SCHW) trading revenues fell 10% in the second quarter.
In the second quarter, Interactive Brokers Group collected a commission of $3.86 per cleared DART, a decline of 4% YoY. Overall, brokerage companies are reducing commission rates. Fintech companies are offering lower rates to gain market share. On a sequential basis, IBKR’s commission per cleared DART also fell 4% in the second quarter.
Moving forward, Interactive Brokers Group might consider cutting its commission rate per cleared DART, which could help the company to boost total accounts. E*TRADE Financial had an average commission per trade of $7.27 in the first quarter, which implies a fall of 26% on a YoY basis.