IBKR - Earnings call transcript Q3 2021 | Interactive Brokers Group, Inc.

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Operator

Good day and thank you for standing by. Welcome to the Interactive Brokers Group Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now Director hand of would to conference I Stuebe, Nancy Investor Instructions] like the to over [Operator Relations. Please go ahead.

Nancy Stuebe

Thank for joining the business. XXXX and me to thank our but will comments the afternoon, again, quarter on his on Once earnings you. third call. handle asked is call, He present us Good for Thomas you the Q&A.

future are are call may control. represent of belief regarding which not Company's include the nature their and statements, today's events, forward-looking reminder, by a outside As the certain which Company's

Our actual in materially that in statements. results and may disclaimers differ ask press our financial these from possibly condition you We the indicated what to release. refer is forward-looking

SEC. also risk we description of quarter, review record our once factors again should reached financial of a the with In accounts, X,XXX,XXX. a third in You the number contained reports filed

was they of reported to markets in Our the than normalized only for XX% quarter. three account we this hyperactive constructive commissions driving exceeded second The first be nearly year-over-year regions. highest our year's ever continue $XXX have to of were year, equal million, last more geographic but by growth all us,

who reported at $XXX as adjusted our revenues our $XX than price our time, as to of less of $XXX Since enough million has gain stock million, relatively that XXXX has distraction We price. $XXX revenues as revenues the our gather introducing low net started to of Tiger net to only and a XXXX large Brokers' a a this scale the quarter as Tiger virtually enter capital into all the broker. million. business also financials. investment, net record, brokerage second due lot million blended provided they though first depreciation at about unintended them investment to was our our were invested in it an as share help $X, look at high minor and $X again $XX was wanted in end, traded as on investors out Even stock quarter. The While using of highest and surpassed GAAP the a our the on platform certainly were by adjustment on to this

With the of data security, get is now required Chinese to understanding the for government while to there. the until new of the regulator focus a with they keep to on part how stock come on a we expect the swinging clear and what

are on the X.X of product financial world the costs. underscores brokerage our focus as trade and can much and over available to to are us clients million XXX that means investment other such This us us minimizing only are capability all from custodied maximize and the users, single, even customers more that in. our often. enables available also they report This commodities gives working account. And not currencies. customers, our which in venues one Our positions custom for to or hard you performance business many not of on yesterday for investment column trading on from we column. are small while different to that the the that. which many it, service it investment returns compiled even across generate upon with told strength crypto offering can and but no who so all currency and yet each We request your and them is interact of automating nicely risk include And been is continents ever is our We've securities, your for holdings to ability country not elsewhere easy. are by crypto, what and the assets yourself incorporate major customers, the added currencies and add have you does into possible. happens our our it this summarizes Automation enabled of reason jurisdictions seemingly is taking request and matter that report platform registered tailor but as just we platform advisors the all under to across our non-U.S. portfolios a products or products to of rules, Automation not

XX a in was equity XX give of We was of continue quarter the our quarter shares. trading the it base. to active this, volume third client XXXX, third XXXX, see among billion sense our billion To of In shares.

reached XXX quarter, it billion shares. This

total X.X reached quarter of also the highest DARTs clients new first and last Client this year, following be investing to activity can from year. history, their existing our company which a in of as begin quarters third Third million confidence loans, continue XX% the in clients up $XX.X participate. customer were billion, margin seen two record

only their available fraction X% represents work. our to $XX The policies The loans. lending we our for are become. is outstanding loans a because we IBKR putting leverage. to and accounts balances billion X% of all clients margin of reason our X.XX% in clients a even of margin industry automatically all margin that into use that This liquidate for investable margin often traders participate, major X.XX% more loans, assets. of hold positions remarkable is high about the come our see for we also policy to violation charge to than less to funds comparatively to trade continue draw of though customers sophisticated conservative, we We policies. This stronger only Pro these margin is

know was this. no can profit margins We for pretax non-core claim XX%. adjusted XX% margin close reported other and of was to who broker items profit Our

lowest investors quarter individual who in by account in to Our stay continues is from are that who led tend activity year breadth This the we a Investor quite our regions of prior new as those globally. both of many we are to growth with cost because positive, emerge offer. the invest there strong offer investors, remains pandemic. and extremely be and internationally, confidence especially across to activity wish difficult strategic globe product one ahead one all and us, adds. to This advantages, to broad more is the prior range

For do providing vary any is growing market complex. is competitive all with legal, in To and so broker markets. globally by that advantage. accounts international and are can more currency Having expensive so. be our of requirements rapidly Three compliance, access our market this automated and tax reporting quarters even

continuing financial with than we have to grown with dedication continues. turn comfortable of online, grown in financial accounts XX% which can be at institutions People this Once and Even electronically. more all global last products indefinitely. forward to interest again, through each add year to account began of year-on-year doing business COVID, growth. is geographies account markets, along early least This, showed They services as year-over-year regions our and platform even more connected more client people the to XX% why we and have and participate. more come segments their that our showing going total greater period all markets drives in of other growth adds believe strong more

reliable with over and that opportunities of to XX% their growth it fund the European and to is of important grow. topping geographic of growth. XX% client what XX-month regions is five accounts serve the All continued individual I remarkable Hedge they commissions want we maximize go platform continue growth of Individual with invest of accounts client of say, equity XX% run This their a provide regions made of growth Now accounts, XX%, and XX% all equity of customers because client over underscores our around account segments. global commissions of in our XX% also people variety ways our up to growth XX% in XX%. customers prefer. to over who we will our always world with saw

September ended XX% we account growth. months XX, and equity XX fund customer the growth, saw commission hedge X% X% growth For

our to add broker hedge and continue segment. in We our manager larger equity funds we particularly the to to funds, in According single of which the prime eighth seventh accounts, moved place client X% of robust the of growth funds. client hedge in servicing and X% equity be as X% can represent Preqin, from this our Hedge most growing commissions. seen

prime in most of our the we the our row, are trading funds in million first prime are XX% AUM. $XX are equity as under broker servicing of in And Proprietary with a broker. hedge X% We place second year accounts, commissions. the of fastest-growing client and the for X% firms

group this All by accounts growth. the XX% in quarter, grew for saw For in commissions. equity and XX-month XX% strong in client XX% regions the period,

advisors, international invest favorable existing under higher us product open Interactive this SMAs the in world to firms Europe reputation this and We you adaptable particular more more that advisor for due trade in structures our in unusually more of to firms client of set Account now This manage better funds, grew And where executions to trade efficient a investors equity tools advisors wide are diverse Brokers new success and our tends with and of and as and and on across to beginning client equity in our hedge the Financial seek and dedicated as desk capitalize our to products seeing to as capture are for rich of seamless, commission RIA move More be a regular to by for by and in and master includes XX% and typically conservatively. use accounts our prop base, to client can try commissions. counterbalance than EU. interest negative one get and tend trading segment variety XX% business crypto. firms are period, service X% of globally. XX% customer growth larger accounts continue we our by capabilities customer and growth account the advisors group our can XX% equity XX-month for commissions accounts, X%. rates segment

the global seamless our access for XX%. their our business. XX% commissions and is equity account their grow the brokers Our ticket offerings new the brokers turn of its latest XX% to and final Worldwide, up of critical XX% accounts, depth segment our brokers. client to XX% extend XX functionality. to to IBroker commissions. customers of global was introducing back-office up equity our and represent months, breadth Offering for their client is of for XX% and growth of segment These trading brokers platform existing up and looking looking starting with

who opportunity partner growth was to best With investors enhance want in provide to brokers global that know introducing to Much the access, to it. done is us succeed their worldwide with our our response in month provide to monthly inactivity of solutions. platform this improve and training demand. ongoing early We client part commitment low-cost last Bitcoin to We fees, quarter. eliminated introduced

coins and available be few our will the Over regions platform. and broadening types on customers months, next the we both of

proud the around a We and with profitable regional own of we have and our more. unique We've advances very are the subsidiaries out rules to group regulations. in in we now point our is each increased numbers compliance world, systems XXX to that building the it staff, at made many spend the which dollars, its great a yield across advertising becoming have on brokerage

grown have force, and We are stride. they gaining our sales

of call order becomes at at we As ATS, a between more overseen and in adding to both to keep time. to better executions love attract institutional with Due known thrill products sophistication capabilities commissions to and sides building for have space, capabilities the for It retail a to attract flow new new over great hurry numbers easier audience the them for it on in better low and along our and PFOF NBBO, at product small All benefit. we platform, our the prices to offer usually where industry where zero Interactive Paul often filling that, in like in space I the controversy it our quickly. our turn the unserved our our and things a the must is we trade payment position opportunity more us unlimited, against for customers. larger provide They but is same to all, Brokers our for flow. the advantage. through and ever-growing it The an the or is more feels and crossing go our is growing moment, in empty CFO, unique commission to Paul? because for either who easier will and the pricing, Brody, to will are, flow focus quarter. diverse opportunities With

Paul Brody

with a Thank earnings I'll you, release note, results, questions. for the everyone, closely joining review open it Thanks, readers' our reordered then third and quarter more Nancy. the we have align bit many to up we'll Please call. for first expectations.

particularly of to was run in customers. borrow higher their strong inactivity are ever a account diversification while gains customers range million So of transactions. Strong of new volumes, XX%. fees will I'll as $XXX margin returning lending payments platform. our of with this We interest fees. trade-off highest further and excluded up revenues growth revenue strong, losses fees earnings. fees, and on X our This options the exchanged retention. Margin believe account more generated for fees income by reflects $XX currency strong higher quarter, especially interest, met driven was with million. exposure quarterly be lending the and on broad the $XX items to XX%. other strategy eliminated groundswell securities $XXX Outside our income be customers market. payments in exposure Commissions was even worth million Page client on drove our the a revenues million. by Many data and $XXX other revenues for liquidity stocks includes July Risk We investments, adjusted from and confidence second and revenues. these of million, to release. X million, risk was start income it Market exchange growing of of fees supply options Net producing in active were doubled its and activity in market business. our also with account improve to and held were demand up to activity higher continued Securities our the million, liquidity principal fees million in investor a $XX our volume. generated in up continue from options customers income inventory of services, We in $X trading those, Other data on $XX in from discontinuing than long-term reflecting

and and regulatory despite trading through fees Execution, rebates clearing system Turning costs exchange distribution volume, substantially on XX% rates. were down routing performance, to lower reduced order liquidity state-of-the-art expenses. capturing this the higher our transaction drove were

clients. gotten these for and have costs reducing at better better We our

trading improve our in we As technology, this the XX% of quarter XX% rising, third while the execution commission, the year. With clearing declined bottom and to quarter 'XX XX% commission a costs in percent quarter from to now revenue third to of in and XXXX more of third of routing client volumes goes line. the continuously order

This of year discipline was ratio net top benefits expense compensation Our XX% and adjusted strong to in and a despite revenues XX%, our expense unchanged headcount. last our increase reflects line. from

this quarter reflecting bank expenses end on XX% of litigation expenses were expect and period neither continue would which prior prior was we X,XXX. the up legal headcount to Our on year, at pace. G&A fees,

growth, and a business. robust Our in we accelerated the expense margin was adjusted investing XX%. pretax are while our the business for leverage operating also practicing By hiring control maintaining in

million $XX with million the portion company's $XX was line public the $X taxes this operating Finally, income of million. on shown, portion the company's

balance X the driven assets of with to release, Page total sheet customers. growth quarter on billion the ended at to our $XXX margin by the Moving lending

capital billion equity for the long-term time, consolidated have $XX first and Our we no debt. reached

provide. which ability We response to Ireland We deploy larger sheet lending, customers our in support growing in want to and the opened margin to gives to to client continue Hungary base access us particular, capital and more our in offices our balance Brexit. business,

the our today's needed For locations, and international operations capital rapidly for those base for other future and growth. our growing provides foundation

balance see growth clients used and sheet by of and also for us opportunities win prospective numerous capital and finally, helps to the business, depth Our and ample we And base our strength partners. worldwide. capital showing current an investment other is

the on volumes geographies. and the in securities In XXX% look our strong contract Let's very activity of Activity above XX% industry Pages for data share X above X and still all most volumes X at briefly high operating our of and types Page options client rose stocks, well is levels in products, release. shows growth. across are XXXX. and customers

X% the and account first markets, our XXX,XXX customers more for accounts per in Commission the of year. million Total quarter account Turning shows reached our IBKR in this to with to directly for commission. record performance global trades for on rate half adds XX% level exchanges. for XXX,XXX confidence success strength environment. to Page growth exchanges market new rebates year and accounts, Total million, by exchange solid ever the in search rising prior lowering of trading paid and latest route X, quarterly by the supportive on over environments capturing reflected growth quarter. generally cleared ongoing their existing investor robust yield negative savings orders commissionable to realizing remains platform. and X.X their Customer top in reflected on X.X the year prior a over Pro the accounts reached equity these zero at customer This DARTs in order a additions highest third and rebates our the interest day. We clients passing and

Our cleared less average we system order, price best last did an as our rebates $X.XX while of execution. order customers achieving to opportunities maximize year, found X% IBKR per Pro paid than adding

as Our same. per pass to and us clients order clearing remains them. to with lower we Profitability costs lower costs execution on our benefit commission the

margin XX% up from driven on year. from comfortable margin benign quarter income were in interest higher client was Next, and lending environment. income Page a margin we strong net X loan lending fairly XX%, this taking reflecting $XXX participation last the last in leverage market securities and and market. on balances was by XX% Investors Average were up break net down ago, respectively, Securities year, GAAP net a year our in release. significantly of million, Total than lending. margin interest the interest increases interest

expanding for high team developed revenues. securities customer securities specialists other activity. lend to in and to We customers grows. our out believe this our generates other the dealers, our from in-house our lending model drives also increasing short securities client these identifying and Together who we is broker proficient our As by system demand, opportunities base, profitable our of customers lending grow with and stocks to proprietary operated our shares which and revenue lending

very by segregated to through credit low, earned When rates negative But no Moving had interest to interest impact customer cash. currencies passing negative, this. net countries. and investing interest When we customers million benchmark pay are benchmark in earn of are from on balances. the their of depositing cash in we some our positive, cost rates rates these as U.S., But $X balances, on the interest because shows on net customers. they rates we in we We and negative this $X benchmark rates are from segregated certain balance. cash to negative in these currencies, earn of million rates on are a where

Taken was from together, income for balances $X the these the net interest million quarter.

in the XX that what in this what quarter ability About Now to attractiveness shows additional rates balances take $XXX next for was of customer newly change conclusion, charge. exclude advantage of does reflects we minimizing In while base we to million strategy the U.S. to rates, in our grow point dollars, estimates so benchmark our an the currencies. estimate of that into the impact our next a of strong of expanding adjust how we are in U.S. our XX those and produce not U.S. not take we customer the any point to our strategy offer rate growth, automate our of XX% changes rise basis may increase rates. impact expect higher of the basis account annually. This cash

in Given opportunities And our accounts the discipline indicated, our to that, we're maintain and future line with ability up capture open Thomas to grow our for arise. as they now and progress expense confident performance, has we'll questions.

Operator

from Instructions] Rich Repetto question the with Piper [Operator comes of Our first line Sandler.

open. now is line Your

Rich Repetto

Good Paul Nancy. evening, Thomas and and

your growth? aren't Futu any But guess the Tiger. situation. with accounts other are going But on have in I China client impacts. what region, Again, have just just Futu been drawn understand question going on you from Thomas, it's the about follow-up that follow-on other there other know what's I I is explain and impacts servers any Tiger. a down China. Just operations, clear that on and to can at

Thomas Peterffy

that else. not I'm may Well, so glad it's to you. be It clear everybody clear so to

on the will rules time we data Union any rules. to Since procedures client IBKR -- imposed under customers for so but satisfy, the process in that China we we we find came criteria we the the the data to day very keep customers. know similar the and This you they while one that is who built on China, reuse data effect, public. European procedures so-called have keep those their by into must not does the GDPR extend GDPR criteria at So, reside have in them Chinese modify that

Now, these China. direct are customers from mainland

introducing regulator have we these two sure the rules. know, to the and brokers, with have you As mentioned, new compliant they the work will with Futu firms are you that to two Tiger Brokers make

Futu and will it individual of number accounts, account about in by we But we know and We we our net may -- that two anyway, been the accounts on have accounts us, the not that Tiger, still our of expected to want the omnibus, close, new a well to in Futu servicing diminution in basis, in to U.S. have to our of While that are, convert investors million. gross on in process. the these of that no derived the but brokers, known has slow danger down I do it anything, accounts from our with that an customer is accounts. to which operate $XX they so gross these having end be that go omnibus revenue, year XX,XXX the accounts planning if it their result mean a their revenue, they to indications XX,XXX rules these revenue who own Most sorry, case, expect think, expected exposure think will

say that. that's So, about to I have what

Rich Repetto

bit what I was But that's complicated a than thought. Thomas. little helpful, It more

Thomas Peterffy

you. Thank

Rich Repetto

Okay.

a know Interactive pricing you competitive. don't the bit is, understand Another you question, to seeing zero because commission. your guess highly the trying just gone customers highly, lot it for go about the haven't what crypto -- offering, early you're style know I it's of Brokers little for I And a know on, in

just that's to any well? whether traders see real whether I'm trying are -- they So crypto as

Thomas Peterffy

All right.

we have because as make we So out this invited you so everywhere, available at know, haven't start, far, the situation. right the licensing we cannot verbed

this moment in this So, United is the only available at States.

We have so far so it, far. have invited, I think requests around XXX,XXX to what accounts permission we that's of which trade XX,XXX and

Now we only trade time, broker for positions one her on clients account. stocks at are manager in one with so because investment as often crypto would like yesterday, investment and accounts and of enabled managed along some an that the manage creates where investment to heard we and advisors and registered registered can situation have have all advisors, whose shows we this where a by that are bonds crypto, them people screen,

Rich Repetto

Gamestop the Got it. connections, that out was SEC see quite whether or that information question Very maybe -- they had big came from reached, takeaways all you Thomas. any or is, report anyway Last yesterday, wondering I didn't but provided helpful. did, stock you the meme the report was conclusions the just I

Thomas Peterffy

two that cover doubled activity trading extremely pre-opening days surprised not very, the very the what was fails because I fails, matter first on to cover to pre-opening mention because has or when they has broker the tripled, stock that open, no those to to usually day price. their is prior broker indicating on the find did a the the usually on the is run-up strong

prior what I when most price open. done the have So, in that's two think to the days those

Rich Repetto

But, since the already Tom. I Thomas. in you, thanks, get back three Thank questions. it. Got I'll queue asked anyway,

Operator

Thank you.

from question comes Will the Our of line Goldman Sachs. with next Nance

is line open. Your

Will Nance

could remarks on back If growth. talked couple maybe Thomas, of start around the about the I I I some in years you comments growth. XX% think of think ago, a prepared

talking larger and XX% growth about it's we're side. on Now account a

if that a just outlook you'd brand the you growth is or you more seeing little and to, I curious in think, kind more it the So confident have the what seems I'm customers? think particularly resonate guys bit there's you're in with anything helping like of market point gotten

Thomas Peterffy

Yes.

experiencing one, that we the And two, are growth. So nurturing stronger forward, plan to we go how have a number of growth. clear number

about indefinitely. I'm -- being XX% forward confident about So, very going for

Will Nance

Maybe helpful. Paul expenses. one just a ticky-tack That's for the on

think you legal mentioned quarter. the some magnitude handful in of think Any there G&A and a I there? were this sense other I things elevated expenses, of

Paul Brody

So it's probably $X probably million that say more that's like number quarter, relatively running bit to that. an it, on to the put to To that safe previously maybe in is been we it run to. rate return a had overall realistic $X extra million the something

Will Nance

may it. but Got curious much there's that? shed news lastly, if just light And address the I maybe you any then there just can you can the if it. Appreciate you say, helpful. can be That's of quarter flow realize BSA, not in wondering some was around the on AML I issues?

Thomas Peterffy

exactly What do you mean?

Will Nance

investigation? the guys think around around some as around you think I article and Morgan I Stanley [indiscernible] I had,

Thomas Peterffy

the compliance would I you moved are Well, to into think haven't I But tell and I'm customer, situation. that mean, now. Oh, of it if they yes, were right, even I by a my sure people it. our I was yes. first that attention brought you have heard are serious I honestly, the that handling would issue, time

Operator

Our from Fannon next Dan Jefferies. with question comes

open. is line Your

Dan Fannon

coming to wanted that customers board, across profile account all you call or customer? existing on you're that areas you of there Is growth, your I talk specific specific kind any where having broadly out regions on the follow-up you've I anything new how just the about said outsized very know compares very obviously to success? the positive of Thanks. channels. Can regions, but to strong and everywhere,

Thomas Peterffy

the No, it's great every year. It's similar Board. across just growth

Dan Fannon

of And similar the the customer is profile or?

Thomas Peterffy

beginning, Yes. started similar. is the I of course look, floor people, very we Interactive the after mean, were when say going had the we I to traders, it the floor. is Yes, Brokers, mean, lead that let's the at traders

look customers of very had high very to rates back our at early years, trading. you we few if So

forward. go we So that down as is gradually coming

basically like So slowly trades still account every trades about that dropping, the year, or but have per year XXX account. per around is we a number something of

Dan Fannon

you or just to obviously your is you then that And assume I spending? channels terms -- dollars account should you of about on think said think growth, alluded something we Okay. your And the that that think how that ties dollars, in I allow mentioned terms increased talk advertising yield to an of, are spend which more. you but about Can going certain regions in further? that that that or there advertising to you

Thomas Peterffy

dollars and to advertising tied when of aspects of a our we do Yes, advertising. certain introduce now with because we that something certainly lot are new, our platform,

introduce crypto, continue time. going quite we is some crypto a to we when advertising for had campaign So that

we we are Now, huge start a ad very, very the shortly are capability new going on campaign. with to November X, introducing that

and account this the so -- of feel part why confident I growth. reason So about

Operator

next KBW. with Our Voigt Kyle question from comes the line of

is Your line open.

Kyle Voigt

terms good I advertising. has If maybe there, I mentioned different, has those channels know you just some [indiscernible]? product that on marketing about on like evening. Thomas, clearly there actually could that's I getting and and are you investment marketing just wondering in historically like adequate strategy return which frustration rollouts but could being question Hey, -- the that's new speak or a spent been Dan's I'm on shift been dollars question, there follow-up in if to changed. where, not know just

Thomas Peterffy

gain trying competitive everybody advertise more know, is this to sensitive you because issue, accounts. very a and Yes, but is

So yes, where and very you better, now you gotten worth do and have understand money's your get not. where it we deeply we into

Kyle Voigt

Got it.

advertising going near drive medium XXXX to beyond, story of to be you do kind you're to but medium out looking going term, saying? just term the part you term, we're term, medium think as that think and that's to over bigger account that over kind be growth so, of a is of the growth. Is the do And not continuously what

Thomas Peterffy

are hope so. them, that our and indication that that we certainly, for I think to do we the every not have I and are proof to but plans, work. they have I going going definite forward with go we plans have

Kyle Voigt

better that's you. understand set just And the the question, generated, guess you that's I can trading contract enough. with terms Got just so a Paxos Is share us relationship, structure? on Paxos? Thank Fair there of then wondering in and the shared revenue help revenue it. another

Thomas Peterffy

are gives earlier a share commission and gives then to it, it, share the fee. us us the charge customers customer we a the of of Paxos, So to and it Paxos, not Paxos a

Kyle Voigt

Understood. my getting And increase I math then of just just the looks is, I'm size at average in the account like last one if my correctly look doing the terms in Thanks. the individual -- remarks, markets. size, equity is smaller it account prepared the if despite from

client looks generally acquired average So I earlier fair to but similar, that being that's to is they're accounts? the say relatively Thomas? say, that that think smaller-sized it you commented fair Is

Thomas Peterffy

on average, broker introducing individual Yes. are smaller. accounts yes, Well, accounts and the smaller, are

Operator

question comes Our Compass Point. next line from the with Chris Allen of

open. line Your is

Chris Allen

evening, Good everyone.

to get a timing Thomas you think on up launch, of follow where things. the Any the on may terms couple said to color number wanted Just One, you to coins. do that? broad that? of I you think just you're on around the of crypto going What's in

Thomas Peterffy

well, are more coins adding in it's I on you they working Paxos, not up and up It's I five the near to to understand us. think, that future. know

Chris Allen

just follow And some on I question to just I future correctly. make understood sure I to Understood. targets, then, in spot it want on up your want Rich's

the you even the to want to expect time? continue or revenues year-end. be IB expect be You $XX some those customers migrate to Just it maintained, over to at to that Do on that. if sub-clearing, U.S. gross going decline is relationships of get to they from to clear million

Thomas Peterffy

at simple, end $XX to of So the the year-to-date the just no, expanded I it year. looked I growth the and million is

up a So it's mean, it $XX if right, understandable, quantify, I easily right. not guess that down. have I I or to so to million year go I'm that, expecting understandable, is

in Now about some up that to for of our known, become applied. States, -- everybody I put and and has Futu they've been talking a wants time United and some we the that have mean separate they company

applied registration, OCC, they've think I and etcetera. for FINRA

us. leave eventually to them expecting are we So

XX,XXX those will result, account this I slow little new mentioned, we'll from mostly lose accounts, think omnibus we still those that anything accounts. as and of our Otherwise, as I down and may rule, -- that come go as from yes, accounts an bit. so into individual a if And number as a think have Tiger, accounts that I

seemingly would accounts increase. the of But account number our shrink. average So simultaneously, size will

Operator

Sykes from Gabelli. with the of next Macrae line question Our comes

open. is line Your

Macrae Sykes

I something etcetera? as once always Coinbase a a should and out business the this as this rolling that operations, driver going growth complementary you? is to you're Just kind competitive accounts? for being of of future, other how the this product to I it get could could Or mean is in Interactive being for you a be platform, viewing pretty major think back relationship, if things, focus we this a competitors, more your your of given significant like the cryptocurrency, settled on think huge think a you not obviously is and some it you're but sounds

Thomas Peterffy

I they Well, of the wouldn't just the in of believe invest I States because millions I that product of will no, that, among are as think XXs United think crypto there and right. many investors one in,

in strengths, -- enabling always have one account from right. world from right. on it -- the currency screen to it's think competitive all right, them a nicer to to one screen, That's some it's over one account, and future, what they assets screen neck for buy stock buy on to to a for or trade when the all -- to our like mean that want any has a different -- product been they a right. that's see have crypto had or account I an person so pain the trade a want from it have much So in by versus in when option and I people and one sell for one

Macrae Sykes

of are of wanted to gray of bit. terms markets I these providing wanted to subjects Okay. obviously sort your I gamification good sort just doing I some or but your platforms areas on of get wanted -- to ethics of engagement, customer. a and And are and the better, the engaging them just views understand around get in the where clients some to increase on switching thoughts these rules little gimmicks other get appreciate I that. education between but perhaps to to the crossing

Thomas Peterffy

our So effort, education so another computer indicated brokers' more providing may we to that we you I and been tell to platform. clients, helpful played I not any that do and graphics know on will reveal previously, are frankly, because have as also in gamification, And never about myself certain focusing be on games. I I've never

don't the ask similarities. to man that. know the I'm about I wrong So

Operator

from next Piper comes with question Repetto Rich [Operator Our Sandler. Instructions]

open. is line Your

Rich Repetto

one want assume segregated Paul, that follow there get And up a just cash. I question have with short-term to your don't to billion of quantify and non-U.S. you that are of you fully interest up, Yes, the mentioned to to could us, tell rates cash also your that's customers I part, XX% rates balances that interest. XX% And the of in pay incremental don't increase is to went any quantify if way we clients, XXX,XXX the $XX other

Paul Brody

Right.

currency because in little that things. XX%. bring areas rules, can makes in a U.S. is a the So cash protect about order foreign is customer a about XX% certain we that into Not under currencies That's for them minor to XX%. It the different dollars, couple to credits. cash, customers. foreign SEC of bit I you of correction, have back segregated a give

your So, on sorry is about credit. to spread. we're what was the paying It to no boils second down rate your interest -- changes where on question currently I'm interest our

our dollars, advertised benchmark minus The XX is U.S. are spread website. points. in the there So right basis on

up pass-through maybe now similar goes we to customers, want than it those those that less free as interest, treat doesn't a rate currencies funds the cost rate pass happen, similarly something about more $XX,XXX in keep the a at over of negative rate other currencies. give they we start customers again balances, and little points, or well that do paying kind we And Fed we majority will with pass, because rate I lot. least us basis through zero those equivalent negative them except currencies, in larger and to negative a and just information around, interest on get currencies, our on when customers of get think you you will I'll XX So, asked negative rates go

Thomas Peterffy

to respond And the $XXX,XXX to question.

the if the -- value we remember, a that the of accounts in half going So and you $XXX,XXX amount decreases. less gradually account to are rates the with X% funds amount a and of say above pay go of account interest to to percent as the

get XX% part worth cash has for account. the So the somebody his example, asset on if an going of account to $XX,XXX, he's in

Rich Repetto

regulatory regards report we've order reading but Last the now there forward? you quarter either thoughts thoughts question to this, regulation Thomas, it. the after will or or you payment is, whether on had Got interactions any actually flow for views since last asked quarter, but Understood. I on about might have be any during payment your a had to changes any coming

Thomas Peterffy

that about, don't is there as the that it. love back he do really know -- Gensler people to think something whether like ways said to to going to something, I or Well, do very, because he us be price one much, to for if not. would I is do wish will and and very looking much find he he that

very to information he's flow, It's on, hard right. not order, but information and And that figure smart because, person different order, mean the but high information put indeed we've that the I sure when the broker, may a through send this right. person by person I'm certainly with dollar trader, the the a out a with be flow, the different them get is having that through not internalizers flow. the frequency So, next he being while comes damaged

Rich Repetto

Yes.

helpful. That's Okay.

latest to on hear wanted you. thoughts your it. Just Thank

Thomas Peterffy

All right.

Operator

turn Nancy the now time. this would further no I showing to like Stuebe. conference I'm to at back questions

Nancy Stuebe

Thank you, everyone participating for today.

on we and of transcript talk available on our reminder, will website, As to a clean will version tomorrow. we call our this be you and also end. replay next a our again, posting Thanks be will for quarter site

Operator

for call. This participating. conference Thank today's you concludes

now may You disconnect.

Interactive Brokers (IBKR) 20 Oct 212021 Q3 Earnings call transcript