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IBKR
Investor Relations
Thomas Peterffy : Founder and Chairman
Milan Galek: President and CEO
IBKR Rules
IBKR-PRO orders are submitted to IBKR's high-speed Best Execution Order Routing System (SmartRouting), which is designed to optimize execution price, speed and total cost of execution for stocks and options.
IBKR's SmartRouting system continually scans competing market centers and automatically seeks to route orders to the best market, taking into account factors such as quote size, quote price, exchange or ATS transaction fees or rebates and the potential availability of price improvement (execution at a better price than the National Best Bid or Offer ("NBBO"), "Price Improvement").
IBKR-LITE clients are charged zero commission for NMS stock orders (except for certain order types, orders to execute at the open or close, orders executed outside of regular trading hours, and orders for stocks executed under $1.002) and a fixed rate commission per contract for US equity options.
IBKR-LITE orders for NMS stocks are generally routed to select over-the-counter marketmakers ("Market Makers") for handling. IBKR's agreements with the Market Makers provide Interactive Brokers payment for order flow from each Market Maker for trades executed with that Market Maker. A potential effect of these payments is reduced price improvement on executions received by IBKR-LITE clients, in proportion to the payment received by IBKR.
IBKR may also route IBKR-LITE orders to another broker, ATS, or exchange (each an "Away Route"), in which case IBKR may collect payment for order flow for trades executed at or through that Away Route;
IBKR may also route IBKR-LITE orders in US equity options to Market Makers for handling, and may collect payment for order flow for options trades executed through such Market Makers and/or trades executed at an Away Route.
By using the IBKR-LITE service, clients authorize IBKR to receive and retain such payments from Market Makers and Away Routes, in whole or in part, for IBKR's own account and not that of the client, in consideration for services provided by IBKR to the client.
In a cash account, an investor must pay for the purchase of a security (meaning, the trade must settle) prior to selling that security. If an investor buys a security and then sells that same security without paying for the security in full by settlement date, the investor is considered to be “free riding.” ... Our end of day surveillance would still consider closing a position before settlement a Free Riding violation and automatically puts the account into "Cash Up Front" restriction for the next 90 days.
Your Total Cash Value includes your settled and unsettled funds, and you will be able to place a new order when your Available Funds (ELV - Initial Margin) is positive (as that represents your fully settled cash after a closing trade). The real time check for fully settled cash is done at the Credit Check when entering a new order.
Account holders who wish to have access to unsettled funds prior to the settlement day may do so by requesting a margin type account. Under a margin type account, unsettled funds may be used for trading purposes but may not be withdrawn until settlement. ... If you recently downgraded your account from Margin to Cash, market regulations require a waiting period of 30 days before your account becomes eligible for Margin again.
The one exception is under the Free-Riding rule. Clients with a cash account can use the proceeds from the sale of a security to purchase a different security under the condition that the second security is held until settlement of the initial sale. If the client sells the second security prior to settlement of the initial trade, they will be in violation of the Free-Riding rule and will be locked for 90 days from utilizing this exception.
So I wired 4000 CHF to my account. It arrived, and I converted it to USD. I see 0 under my CHF balance, and 4260 in my USD balance.
Then I go and try to buy some VT. I chose LIMIT 61.20 and 60 shares. But no, it won’t ever accept my order because it says I don’t have enough settled cash and need 3800 USD. How do I need 3800 USD, I have 4260 USD in cash right here right now!
There are three steps:
- transfer funds
- exchange currency
- trade stock
“YOUR ORDER IS NOT ACCEPTED. THERE IS INSUFFICIENT SETTLED CASH [-XXX USD for XXX] IN YOUR ACCOUNT TO OBTAIN THE DESIRED POSITION.”
However I figured out why I wasn’t able to buy yesterday. Apparently my deposit from 3 days ago was not yet “cleared”. Fortunately I got a message today that it has been cleared:
“XXX CHF has been processed and is now available for trading!”
If the aggregate cash balance in a given account is a debit, or negative, then funds are being borrowed and the loan is subject to interest charges. A loan may still exist, however, even if the aggregate cash balance is a credit, or positive, as a result of balance netting or timing differences.
Unsettled Funds - borrowings are determined based upon settled funds and the time frame by which payment is due or received for a given transaction is product specific (e.g., stocks generally settle in 3 business days, spot currencies 2 and derivatives 1). For statement and trading platform purposes, cash balances are reported on a trade date rather than settlement date basis, as if settlement has completed.
As a result, an account reporting a credit cash balance may, in fact, still be carrying a margin loan if that balance includes proceeds from the sale of stock purchased with borrowed funds awaiting settlement. Similarly, an account may report a trade date based debit balance, but not yet incurring a margin loan and interest charges, as the trade has not yet settled.
Interest is calculated and accrued daily based on end-of-day settled cash balances.
Accrued interest is posted to the account on the third business day of the following month.
Short stock proceeds cannot be used to offset debit interest.
Different transactions have different settlement dates:
- Stock trades typically settle in T+1 (one business day after the trade date)
- Currency conversions may take two business days to settle
My understanding of this is that although you don't officially get the funds from the sale until Trade+1 days, you also don't officially pay for the new securities until T+1. On normal circumstances, brokerages will set that money aside from your balance, so you don't double-spend, but it's not handed over to the seller until settlement.
Dividend Reinvestment is available to IB LLC, IB AU, IB CAN, IB HK, IB IE, IB JP, IB SG and IB UK clients.
Only U.S., Canada and Europe-listed common and preferred stocks and ETFs paying cash dividends are eligible for reinvestment.
Standard commissions as listed on our website are applied for the purchase.
Even if a client resides in one of the above listed countries, they will still not be eligible if any of the following are true:
- any connection to China
Articles
- 2025-07-18 Can't think of anything that will stop this market rally, says Interactive Brokers' Peterffy
So I basically do not see any dark clouds in the horizon. As a matter of fact, I can't think of anything that will stop this rally. I expect this rally to continue for the next two or three years.
What do you think powers it from here?
So the Trump policies are very favorable for equities, especially the doing away of all the barriers to business. Less regulation, more incentives to save and invest are very, very favorable.
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Stablecoin fever is still running hot. Zerohash, a crypto and stablecoin infrastructure startup, is set to raise about $100 million at nearly a $1 billion valuation, according to two sources familiar with the deal. The publicly traded online brokerage Interactive Brokers is leading the funding round.
Zerohash partnered with Stripe to help the fintech giant’s customers go from cash to stablecoins through Zerohash’s network of banking relationships and regulatory licenses. It has also worked with Securitize, another crypto startup, to help traditional finance titans like BlackRock and Franklin Templeton enter the tokenization race, or when issuers put traditional financial assets like money market funds into blockchain wrappers. Zerohash lets customers exchange stablecoins for tokenized assets. Other Zerohash clients include prediction marketplace Kalshi as well as neobank MoneyLion.
Apr. 8, 2025 —The Securities and Exchange Commission today announced that starting on May 14, 2025, the fee rates applicable to most securities transactions will be set at $0.00 per million dollars.
Consequently, each SRO will continue to pay the Commission a rate of $27.80 per million for covered sales occurring on charge dates through May 13, 2025, and a rate of $0.00 per million for covered sales occurring on charge dates on or after May 14, 2025.
The assessment on security futures transactions will remain unchanged at $0.0042 for each round turn transaction.
GREENWICH, CT, April 8, 2025 - Interactive Brokers (Nasdaq: IBKR), an automated global electronic broker, announced the addition of new cryptocurrency tokens to its trading platform: Chainlink (LINK), Avalanche (AVAX), and Sui (SUI). These new tokens join Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), Solana (SOL), Cardano (ADA), Ripple (XRP), and Dogecoin (DOGE), providing investors access to an extensive suite of popular digital assets. LINK, AVAX and SUI are available to clients with an account at Zero Hash LLC.
REENWICH, CT, March 26, 2025 - Interactive Brokers (Nasdaq: IBKR), an automated global electronic broker, today announced the addition of four popular cryptocurrency tokens to its trading platform: Solana (SOL), Cardano (ADA), Ripple (XRP), and Dogecoin (DOGE). These new tokens join Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH), providing investors access to some of the most actively traded digital assets. SOL, ADA, XRP and DOGE are available to clients with an account at Zero Hash LLC, and SOL is available to clients with an account at Paxos Trust Company.
Interactive Brokers offers some of the lowest cryptocurrency trading costs in the industry, which are less than leading cryptocurrency exchanges and online brokers. Based on monthly volume, commissions range from 0.12% to 0.18% of trade value, with a minimum of just $1.75 per order. Clients pay no added spreads, markups, or custody fees, ensuring transparent pricing on every trade.
Cryptocurrency trading is available to eligible clients of Interactive Brokers LLC and Interactive Brokers (U.K.) Limited. Product and feature availability may vary depending on region.
Zero Hash LLC is a FinCen-registered Money Service Business and a regulated Money Transmitter that can operate in 51 U.S. jurisdictions. Zero Hash LLC and Zero Hash Liquidity Services LLC are licensed to engage in virtual currency business activity by the New York State Department of Financial Services.
So cryptocurrencies are a very interesting area. We we have been into cryptocurrencies for about three years. We charge less commission on that crypto currency trade than any other firm other than Robinhood. But Robinhood has a lot of wider spread because they get their commissions paid by the market maker who they send their orders to. So I think on balance our platform is probably the most efficient one for a crypto trader and otherwise, to tell you frankly, I am sort of scared of cryptos because, you know, that can go to any price because it's basically just a figment of the imagination. So it doesn't have any underlying value. The only value it has is the same as the paper dollar, which is nothing.
So I think that anybody who does not have Bitcoin should have some Bitcoin, but not too much. I would recommend that people put maybe 2 to 3% of their net worth into Bitcoin. And we, for example, will not allow anyone to invest more than 10% of their assets into Bitcoin because I think that would be very dangerous.
GREENWICH, CT, June 26, 2024, Interactive Brokers (Nasdaq: IBKR), On the morning of Monday, June 3, 2024, at approximately 9:50 am EDT, the price of Berkshire Hathaway Class A shares (“BRK A”) suddenly plummeted in the space of a few seconds from approximately $622,000 per share to approximately $185 per share. This occurred as part of an unspecified technical issue at the New York Stock Exchange (“NYSE”).
Some of the clients of the various brokerage subsidiaries of Interactive Brokers Group, Inc. (together with its subsidiaries, the “Company”), in an apparent attempt to take advantage of this “opportunity,” submitted market buy orders during the trading halt, presumably expecting those orders to be filled at approximately $185/share when trading resumed.
Without any further notice and without addressing a substantial order imbalance that developed during the halt, NYSE resumed trading of BRK A at approximately 11:35:54 am EDT at a price of $648,000. Over the next 98 seconds, the price of BRK A rose to as high as $741,971.39 per share. Many of the Company’s clients that had placed market buy orders during the trading halt were filled at various prices during this run-up, including some who were filled at the peak price.
That evening, the Company determined to take over a substantial portion of these trades as a customer accommodation. The Company also promptly filed claims for compensation with NYSE. On June 25, 2024, NYSE notified the Company that it had denied those claims in full. As a result, the Company has realized losses (including losses on certain hedge transactions) in the amount of approximately $48 million.
The following Spot Bitcoin and Ether ETPs are available as of April 30, 2024: 3008/3042/3439/3009/3046/3179
I own some, even though I believe it worth nothing, because other people believe it worth something.
Quarterly Results
2025 Q2
Market
What we experienced in the second quarter felt like a “roller coaster in reverse”. Instead of the market moving upward, getting to a high level, then dropping precipitously to a series of volatile ups and downs, we got the precipitous drop first, with the S&P reaching a low on April 8, then a spike of volatility, followed by the market grinding upwards towards quarter-end. The uncertainty and volatility during the quarter led to an accompanying spike in trade volumes.
Also over the quarter, we saw the shrinking life of market dips: investors, whether looking for securities with momentum behind them, or simply worried about missing out on a rally, “bought the dip”. In equities, we saw customers actively using our platform tools to find companies to invest in that met their particular parameters. This included an expansion of the “Magnificent 7” to include companies that may be beneficiaries of the world embrace of artificial intelligence, as AI is incorporated into more environments.
By quarter-end, the market had recovered to surpass its February peak, closing up over 10% and, since quarter-end, it has continued upwards from there.
Overnight Trading
We continue to see increasing activity in our overnight trading hours. ... Our overnight volumes grew over 170% from second quarter 2024 to second quarter 2025.
If you look at the exchange traded products like options and futures, the execution costs are the same, whether you trade them overnight or during the day.
The execution costs for stocks are very different because the stocks are currently not offered outside of extended trading hours. So every platform that offers them and Interactive Brokers has a substantial offering in this space, has a different price than what one would pay to an exchange. Interactive Brokers has its own ATS, Eos ATS, where overnight stocks are trading. And it is also connected to Blue Ocean that is another significant ATS in the space. So the combination with these two venues allows us to offer thousands and thousands of stocks and ETFs during the overnight trading with a lot of liquidity at a very low cost.
I'm sure you remember that the regular trading hours for NYSE stocks or even Nasdaq stocks, those markets opened at 9:30 and close at 4:00 PM and then the so-called extended hours have been added. Those markets now open at 4:00 AM and close at 8:00 PM and the amount of volume we see during those trading sessions is growing as well as the volume we show in the overnight session.
So over time, the differences between the trading hours will not disappear, but will diminish for sure. There will still be some special time periods like “on open” trading at 9:30 and “on close” trading at 4:00 PM because a lot of ETFs and mutual funds marked their NAV using those prices, but we will see more and more overnight trading in the future.
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Crypto
Could this cause you to rethink your current digital asset model, which relies on Paxos partnership but also doesn't allow your clients to use noncustodial wallets with their IBKR accounts.
You might have seen in the news that Interactive Brokers has an investment in a cryptocurrency exchange called Zero Hash. The news was published this week or a week ago that there is a continued capital raise done by Zero Hash, and we obviously participated in it in order to keep our percentage ownership steady. We have a good partnership with Zero Hash. We work together on a number of items that we're going to be delivering in the next quarters. We have already added several cryptocurrencies in the past quarter, and there are numerous initiatives that we are working on. We are going to be making it possible for the clients to fund their accounts with stable coins. We are working on the asset transfer capability in the crypto space, so we will be able to take in crypto asset transfers. And then later during the year, we will be adding staking. Obviously, at the same time, we're working on expanding our ability to offer cryptocurrency trading geographically. At the moment, we are focusing on Europe, and we are hopeful that we will be able to add the capability to our European customers in the coming quarters.
So my disappointment in terms of how much market share we are getting in the crypto space remains. I'm still disappointed given how much less expensive we make it for our customers to buy cryptos. But I do expect, and I do hope for some asset transfers coming our way, which right now is impossible if you already have holdings in cryptocurrencies and you want to switch brokers, you would have to sell those currencies, turn them into cash, and that's what you would have to deposit with us. So supporting asset transfers should open the doors to some new clients to recognize that our prices are lower, and they should bring their assets to our platform. That is my hope.
As to why it is that we are paying attention to crypto, we have been paying attention to it for a while, but the environment has changed with the new administration, which is significantly friendlier to the crypto space than the previous one. We obviously have to react to that. Our investors as well as clients, financial advisers, individual clients do expect to have means to enter the space through us, so we need to add it to our offering
Tokenized Equity
So I will focus on two different stock tokens that are currently available. One was made available to the European clients of Robinhood, I think they made it available at the beginning of July. And I think it's probably best if I contrast our offering to the offering that each has launched.
So what they put online in the form of tokens on US stocks is a fundamentally worse product than what our European clients have had access to for years.
Our clients have access to more than 10,000 real US shares and ETFs – 24 hours a day, 5 days a week. In contrast, the stock tokens that Robinhood made available to the European clients are a derivative on 200 or so symbols, which means that the client does not have ownership interest in the stock. Instead, he or she has an OTC contract against Robinhood Europe. The customer cannot transfer the position to another broker if he wanted to; he would have to sell the position and transfer the cash. As to the cost, if you look at Robinhood's own Key Information Document, which is a document every broker has to offer to their clients about every financial instrument they make available for trading, a hypothetical $10,000 investment costs a client $10, while our clients pay a fraction of that, $1 or so. So that's the Robinhood offering.
There is also Kraken X shares that are available. Kraken, as you know, is a significant cryptocurrency exchange. They made 60 or so tokens available, which are similarly secured notes backed by the underlying in a Jersey entity that they have. The creation and redemption fees for these X shares are 0.5% each, and there is a management fee of 0.25% per year. Now unlike in case of Robinhood, Kraken lets you withdraw the tokens to your own self-custody wallet and then trade the token on the DeFi network. But that obviously leads to some problems.
There was an article a couple of days ago in the Wall Street Journal, which talked about the very significant price differences between the tokens and the underlying shares. And on some date, I think specifically on July 5, Amazon was reported to show the price that was 4 times as large as the stock price from the previous closing price. And the same similarly on Amazon X, which is the token issued by Kraken, suffered even while dislocation on Jupiter. There was lack of liquidity available for the client who submitted an order for $500. And briefly, the Amazon’s token was trading at price 100 times larger than the closing price on the previous day. So all in all, stock tokens at this time seem like a great opportunity to do much worse than buying an ordinary share.
i-broker
One interesting note I would make is that some firms that we spoke to in the past, who at the time decided not to go with Interactive Brokers, but chose a competitor or chose to do an in-house build, are coming back around to us and reengaging. They do realize that our offering is superior. Our cost is superior as well, so they come to us. So I'm very happy with what I see in the pipeline, both in terms of conversion as well as what's in the backlog.
0DTE
As far as the stocks are concerned, that's a little bit a more complicated issue. As I mentioned, the popular 0DTE options are the index options that settle in cash. The stock options, they settle into physical.
There will be some amount of extra volatility in the stock on the days when they publish their earnings or when there is a significant news issue. So you may see some unexpected exercise and assignment activity on those days. And that is an issue that the industry recognizes, we ourselves wrote a comment letter about that. So one way to solve that would be to list 0DTE stock options that settle in cash, but that would come with its own set of problems.
2025 Q1
The Interactive Brokers Group, Inc. Board of Directors declared an increase in the quarterly cash dividend from $0.25 per share to $0.32 per share. This dividend is payable on June 13, 2025, to shareholders of record as of May 30, 2025.
In addition, Interactive Brokers Group, Inc. announced a four-for-one forward split of its common stock to make stock ownership more accessible to investors. Each record holder of common stock as of the close of market on Monday, June 16, 2025, will receive three additional shares of common stock, to be distributed after the close of market on Tuesday, June 17, 2025. Trading is expected to commence on a split-adjusted basis at market open on Wednesday, June 18, 2025.
We added four new cryptocurrencies: Solana, Cardano, Ripple, and Dogecoin and last week introduced three more: Chainlink, Avalanche, and Sui bringing our total offering to 11 cryptocurrencies.
And as a note for the upcoming quarters, the SEC reduced its fee rate to zero effective this coming May 15, which should be a tailwind for execution and clearing costs thereafter. SEC fees totaled $27 million for the current quarter.
So we have seen very significant volumes as the market dropped and then it bounced back up, we saw record volumes. There were some shifts that we noticed our clients traded less fewer options. They traded more futures than usual, and as you would expect, we saw more trading in the fixed income instruments and foreign exchange.
As far as the deleveraging is concerned, we saw a slight decrease around 10% or so, 10% to 12% decrease in margin loans, which is something you would expect when there is such large move downward, you would expect the customers to reduce their risk posture. We also saw somewhat less aggressive positions in options and futures. I think that roughly summarizes what we’ve recently seen.
We increased our appetite for the crypto space, and we added the seven currencies, as well as we increased the limit that governs how much assets a client account can hold in cryptocurrencies. We went from 10% to 30% of NRV.
It’s not growing as fast as we would like, which to me personally, somewhat of a surprise, because if you look at the cost of trading of crypto assets on our platform, it is significantly lower than the cost that our competitors charge, yet we do not see a huge influx of cryptocurrency traders to our platform.
we target our dividends to be between 0.5% and 1% of the stock price.
The exposure fees, they fluctuate more than the margin balances.
The margin balances tend to be very steady and they obviously reflect the income from shares that the customers buy in margin.
The exposure fees are generated based on the exposure that we as a firm can have from clients options and futures positions, not only the leverage stock position. So they tend to fluctuate more. The clients of ours are very nimble. They reduce their options exposures quickly as the market fall. So we expect these exposure fees to fluctuate more than the margin balances.