Q2 2025 Interactive Brokers Group Inc Earnings Call
Good day, and thank you for standing by. Welcome to the interactive brokers group. Second quarter 2025 earnings call. At this time. All participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session to ask a question during the session. You'll need to press star 1 on your telephone. You will then hear an automated message advising. Your hand is raised.
To restore your question. Please press star 1 1 again.
Speaker Change: Please be advised, that today's conference is being recorded, I would like to turn the call over to Nancy Stewie. Please go ahead.
Thank you. Good afternoon, and thank you for joining us for our second quarter 2025 earnings call.
Speaker Change: Joining us today are Thomas peterffy, our founder and chairman Milan GA our president and CEO and Paul Brodie our CFO.
Speaker Change: I will be presenting Milan's comments on the business and all 3 will be available at our Q&A.
As a reminder, today's call may include forward-looking statements, which represent the company's belief regarding future events, which by their nature are not certain and are outside of the company's control.
Speaker Change: Our actual results and financial condition May differ possibly materially from what is indicated in these forward-looking statements.
We ask that you refer to the disclaimers in our press release.
Speaker Change: You should also review a description of risk factors contained in our financial reports filed with the SEC.
But we experienced in the second quarter felt like a roller coaster in reverse.
Instead of the market moving upward getting to a high level and 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 8th.
Speaker Change: Then a spike of volatility followed by the market grinding upwards towards quarter end.
The uncertainty in volatility during the quarter led to an accompanying spike in trade volumes.
Speaker Change: Also over the quarter, we saw the shrinking life of Market dips.
Investors whether they're looking for Securities with momentum behind them or simply worried about missing out on a rally. Bought the dip.
Speaker Change: 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%.
Speaker Change: And since quarter end, it has continued upwards from there.
Volatility and uncertainty often spark increased Market activity.
New account growth, this led to a client trading volumes expanding for stocks options, and futures.
Speaker Change: Our commission Revenue increased by 27% compared to last year though. This figure May slightly understate, the actual growth,
Speaker Change: The SEC fee rate, which is included within our commission Revenue was reduced to zero halfway through the quarter.
Speaker Change: Without this fee, we would have generated an additional 15 million in commission Revenue which would have represented a 3%. Increase on our total of 500 and 516 million.
Speaker Change: We continue to see increasing activity in our overnight trading hours.
Speaker Change: We offer the most comprehensive overnight product set with over 10,000 US stocks and ETFs, plus us Equity index, Futures and options. And on the fixed income side, Global corporate bonds us, treasuries, and European, and UK government bonds.
Given our Global client base. For some customers overnight hours here are their daytime trading hours that they want to operate in and therefore are particularly sought after
Speaker Change: 70% from second quarter, 2024 to second quarter 2025
Given our rapid growth, continuous additions and enhancements to our platforms and periodic volume surges.
Speaker Change: Having a platform that is scalable is critical.
We enhanced our ATS this quarter by improving its performance and ability to handle large spikes in volume by up to 20 times on high volume days.
Speaker Change: Ensuring we're better equipped for Market surges and capable of delivering top tier execution for our clients.
We also made enhancements to our smart order router, which is designed to provide best execution which includes price Improvement and the possibility of receiving rebates.
Speaker Change: It is this price execution Advantage. We offer that keeps our sophisticated customer base engaged on our platform and that encourages new clients.
Speaker Change: We saw strong account growth as we added more investors to our platform.
This quarter, we added 250,000 net new accounts bringing our year-to-date totals over 528,000.
More than we added in all of 2023.
Speaker Change: our application processing is highly automated and continually becoming even more so
allowing us to handle surges in new accounts, sufficiently without adding significantly to our headcount or cost base.
Speaker Change: New accounts, meant more cash in those accounts.
Speaker Change: Raising our client credit balances 34% to a record. 144 billion dollars despite strength and trading volumes indicating. Our customers are using the cash they deposit to participate in the markets.
Our client Equity Rose 34% to 664 billion up 16% for the quarter, versus 11% for the S&P.
Speaker Change: More accounts and higher volumes, translated into strong financial results.
Quarterly commissions, net, interest, total, net revenue, and pre-tax income were all records.
Speaker Change: With our pre-tax income reaching over a billion dollars for the third consecutive quarter.
Our expenses remained? Well controlled. And our pre-tax profit margin was an industry-leading 75%. A record for us.
Speaker Change: Finally, on the platform, side automating substantial parts of the brokerage business and using all possible tools and the judicious inclusion of artificial. Intelligence is the heart of what we do.
Speaker Change: In the second quarter alone, we rolled out thousands of software releases and product configuration changes around the globe.
This is a scale of Automation and effort that we handle routinely within highly regulated environments around the globe.
Speaker Change: To give our clients the global access and Edge, they demand.
Speaker Change: in terms of how the business looked on the client front,
we continue to see growing numbers of investors worldwide, wanting access to International and particularly us markets.
Speaker Change: Regarding introducing Brokers, our pipeline of potential.
We continue to onboard, I Brokers to the platform and add prospective ones to it at a steady Pace with steady demand around the world.
In terms of new efforts and product introductions, we had a busy quarter.
Forecast X is now live for retail clients across most of Europe, as it is, for the US, Canada, and Hong Kong.
Speaker Change: We also expanded into forecast contracts on financial markets, including indices like the S&P 500, as well as 4X, and crypto.
Speaker Change: These have seen strong interest.
Speaker Change: Yesterday, we introduced investment themes.
A powerful new discovery tool designed to help investors quickly turn market trends into actionable trading ideas.
Speaker Change: With investment, themes, clients can begin with broad topics like generative, AI or nuclear energy and instantly uncover companies tied to those themes. No ticker symbols, or prior research needed.
Alternatively they can start with the ticker symbol and view. Detailed company profiles including insights into competitors related Industries and Global Revenue sources. Helping them assess Regional risks and growth opportunities.
We Believe investment, themes will streamline our clients investment process, helping them uncover opportunities and make informed decisions faster than ever before.
Speaker Change: With respect to our stock, we completed our 4441 stock split on June 17th.
And increased the dividend as announced in the previous quarter.
Speaker Change: As for Capital allocation while we have not stopped looking at potential Acquisitions. We realized there are a few opportunities at a price that makes sense for us.
Noting returning capitals to shareholders via increases in the dividend make sense for now.
Speaker Change: We will be adding our 4 millionth customer in the third quarter.
Speaker Change: Just 1 year after adding our 3 millionth.
while the market may move in any direction in the short run,
we are looking to capture the long-term Trend towards more Global investing across, multiple customer types and jurisdictions. Giving investors the ability to invest in the companies, they like paying in the current currency, they have around the clock.
This trend and our ability to serve it with a much lower cost structure and a much broader product and tool set is what sets us apart and will continue to do. So in the years ahead,
Speaker Change: With that, I will turn the call over to Paul Brodie Paul.
Paul Brodie: Thank you Nancy. Thanks everyone for joining the call.
Uh, we'll review the second quarter results. And then, of course, we'll open it up for questions. Starting with our Revenue items on page, 3 of the release
Paul Brodie: We are again pleased with our financial results. This quarter as we again produced record net revenues and pre-tax income.
Commissioners Rose to a record 516 million 27% above last year's. Second quarter, we continue to see higher trading volumes from our growing base of active customers with options and Futures. Both setting new quarterly Vol records.
Net interest income. Also reached a quarterly record of 860 million despite lower Benchmark rates and some of the major currencies and a risk-off posture adopted by investors responding to tariff driven Market uncertainty at the beginning of the quarter.
Paul Brodie: We recognized the 1-time credit of 26 million related to recovery of taxes, withheld at source which is reflected in segregated cash interests.
without this our net interest income, still reached a record 834 million
Higher segregated, cash, balances and strong Securities. Lending contributed to these results.
That interest income also received a benefit from lower interest expense on customer cash, balances as rates have declined worldwide over the past year.
Other fees and services generated 62 million down 9% from the prior year, driven by more cautious, risk-taking by clients leading to lower risk, exposure fees.
Paul Brodie: Partially offset by positive contributions, from higher Market data, and FDIC sweep fees.
Paul Brodie: Other income includes gains and losses on our investments. Our currency diversification strategy and principal transactions.
Note that many of these non-core items are excluded in our adjusted earnings. Our other income was a 42 million, gain both as reported, and as adjusted.
Turning to expenses execution clearing and distribution costs were 116 million in the quarter up just 1% over the year ago quarter despite significantly higher volumes in options in Futures which carry higher fees.
Paul Brodie: Midway through the quarter. The SEC fee rate was cut from 2 7. 8, 0 0,
Paul Brodie: The SEC fee is a pass through to customers so it does not impact our profitability.
As a percent of commission, revenues, execution and clearing costs were 18% in the second quarter for a gross transactional. Profit margin of 82%
Paul Brodie: We calculate this by excluding from execution clearing and distribution.
22 million of non-transaction based costs predominantly Market data fees.
Which do not have a direct commission Revenue component.
Compensation and benefits expense was 163 million for the quarter for a ratio of compensation expense to adjusted net. Revenues of 11% unchanged from last year's quarter.
Paul Brodie: Ibkr stock, incentive plan bonuses. Vest in the second quarter.
Which leads to higher taxes, paid for FICA and other social insurance than in other quarters.
Paul Brodie: The total of these extra taxes was $5 million over the year ago quarter.
Paul Brodie: As always, we remain focused on expense discipline as reflected in our moderate staff, increase of 5% over the prior year. And our headcount at June 30th was 3,087
On higher advertising expenses.
Paul Brodie: Our pre-tax margin was 75% for the quarter, both as reported, and as adjusted.
Income taxes of 98 million.
Paul Brodie: Reflects the sum of the public companies, 50 million and the operating companies 48 million.
The public company's effective tax rate was 18.1% within its usual range.
Paul Brodie: Moving to our balance sheet on page 5 of the release.
Our total assets end of the quarter 33% higher than in the prior year quarter end at 181 billion with growth driven by higher segregated cash, balances and higher margin Lending.
New account growth helped Drive, our record customer credit balances, we continue to believe that our strong financial standing and competitive interest rates provide customers with an attractive place to hold their idle cash.
We have no longer term debt.
Profit growth drove our firm, Equity up 22% to 18.5 billion dollars.
We maintain a balance sheet geared towards supporting growth in our existing businesses, and helping us win new business, by demonstrating our strength, to prospective clients and partners. While also considering overall Capital allocation
The consistent strength of our business and our healthy balance sheet supported our raising the dividend in the second quarter from 1 dollar per year to 1 dollar and 28 or 32 cents on a split adjusted basis.
In our operating data on pages, 6 and 7, our customer trading volumes tracked industry growth over the prior year quarter in our 3, major product classes options, and Futures Contract volumes Rose, 24% and 18%, respectively, and stock, share volumes, Rose 31%.
On page 7, you can see that total customer darts were 3.6 million trades per day up, 49% from the prior year and strong in all product classes.
Paul Brodie: Commission per cleared commissionable order of $2.65 was down from last year, primarily due to the elimination of the SEC fee mid-quarter and the performance of our smart order. Router leading to the capture of higher exchange rebates, which as pass throughs serve to lower, both our commission revenues, and our execution and clearing costs.
Paul Brodie: Page, 8 shows our net interest margin or Nim numbers.
Total gaap net. Interest income was 860 million for the quarter up 9% on the year ago quarter.
Paul Brodie: And excluding the 26 million recovery of taxes withheld at source. It was 834 million
This quarter's Nim is also adjusted by removing this 1-time credit of 26 million from segregated cash interests.
The adjusted Nim, net interest income, was 80061 Million.
Paul Brodie: We also include for Nim purposes, certain income. That is more appropriately, considered interest, but that for gaap purposes is classified as other fees and services or as other income.
Our net interest income, reflects strength, and segregated cash, interest and securities lending, as well as a decrease in interest expense driven by lower Benchmark. Interest rates on customer cash balances
Paul Brodie: a few central banks.
Paul Brodie: The UK, Australia and Europe.
Reduced rates again, this quarter While others including the US, Canada, Hong Kong and Switzerland held steady.
Paul Brodie: Year-on-year, the average US fed funds rate fell 100 basis points or 19%.
Paul Brodie: Despite this decline, our segregated cash interest income was up 2% on higher balances. While margin loan interest decreased 6% on lower rates but was bolstered by higher lending, balances.
The average duration of our Investment Portfolio remained at less than 30 days.
Paul Brodie: The US dollar yield curve, remains inverted from the short to medium term. So we continue to maximize what we earn by focusing on short-term yields
Paul Brodie: rather than accept the lower yields and higher duration risk of longer maturities particularly in an unpredictable economic environment,
The strategy also allows us to maintain a relatively tight maturity match between our assets and liabilities.
Capitalize on.
What we have mentioned in the past still holds true, some of the typical drivers of Securities lending, including IPOs and merger and acquisition activity are somewhat more active than in 2024, but without a substantial impact on the Securities lending Market.
Nevertheless, we have been consistently successful in raising, the total notional dollar value of Securities. We lend
Paul Brodie: as Benchmark interest rates Rose from the near Zero from near zero in 2022,
more of what we earned from Securities, lending became classified as interest on segregated cash.
Paul Brodie: We estimate that at the additional interest earned and paid on cash. Collateral were included under Securities borrowed and loaned.
And securities lending. Net revenue would have been 251 million of this quarter versus 194 million in the prior year quarter, a 29% increase
Interest on customer credit, balances the interest. We pay to our customers on the cash in their accounts.
Declined on Lower uh, Benchmark rates.
Paul Brodie: Even though we built up higher cash, client cash, balances from new account growth and from risk, reducing sales, resulting in cash, balances.
As we have noted in the past the high interest rates we pay on customer cash currently 3.83% unqualified US dollar balances is a significant attraction to new customers.
Fully rate sensitive customer balances ended. The current quarter at 22.8 billion versus 18.6 billion in a year ago. Quarter.
Now, for our estimates, of the impact of changes in rates, given Market, expectations of rate Cuts sometime in 2025, we estimate the effect of a 25 basis. Point decrease in The Benchmark fed funds rate to be a 73 million reduction in annual net interest income.
Note that our starting point for this estimate is June 30th with the FED funds effective rate at 4.33% and balances as of that date.
Paul Brodie: any growth in our balance sheet and interest earning assets would reduce this impact,
About 27% of our customer. Cash balances is not in US dollars.
So estimates of the US rate, change exclude, those currencies.
We estimate the effect of decreases in all the relevant non-us Benchmark rates.
Would reduce annual net, interest income by 8, million, for a 25 basis, point decrease in those benchmarks.
At a high level. A full 1% decrease in all. Benchmark rates would decrease our annual net interest income by 335 million.
Paul Brodie: This takes into account rate sensitive customer balances and firm equity.
Paul Brodie: In the second quarter of 2024.
Paul Brodie: We estimated that a 1% decrease in all Benchmark rates would decrease our annual net interest income by 307 million.
Paul Brodie: In the past year, the US fed funds Benchmark, did in fact, fall 1%.
Paul Brodie: And other countries rates for the most part fell about the same.
However, this quarter is not interest income represented an annualized, increase of 225 million driven by higher balances.
In conclusion, we posted another financially strong quarter in net revenues and pre-tax margin reflecting. Our continued ability to grow our customer base and deliver on our core value proposition to customers. While scaling the business,
Our business strategy continues to be effective automating as much of the brokerage business as possible continuously improving and expanding. What? We offer while minimizing what we charge.
Paul Brodie: With that, we will now open up the line for your questions.
Paul Brodie: Thank you.
Speaker Change: As a reminder, if you would like to ask a question, please press star 1, 1 on your telephone, you'll then hear an automatic automated message. Advising, your hand is raised. We also ask that you, please wait for your name and Company to be announced before proceeding with your question 1 moment while we compile the Q&A roster.
Speaker Change: And our first question today, will be coming from the line of Craig single power of Bank of America. Your line is open
Growth in the summer months, um, into 4 q as we've seen in previous years.
So I would like I always like to over deliver, that's why I uh projected uh lower econ growth than I really believed.
Would take place and I continue to do that for the future.
Great. Well Thomas, we like it when you over deliver too. Um, just for my follow-up. Um, so the genius act, I think just passed in the house several minutes ago, so that's pretty much done. The Clarity Act is making its way through Congress. So 2 digital asset, uh, initiatives. Um, Thomas I'm wondering, um, will broader demand for digital assets, could this cause you to rethink your current digital asset model, which relies on at packsys partnership, but also doesn't allow your clients to use non-custodial wallets with their IB care accounts. I know I I think you felt pretty strong in the past about holding crypto on the balance sheet, which is 1, uh, 1 issue.
Milan GA: So I will take this 1. This is Milan, thanks for the question.
Milan GA: um you might have uh seen in the news that interactive brokers has an investment in a cryptocurrency exchange called, zero hash
Um the news was published uh this week or a week ago that there is a continued Capital raise done by zero hash and we obviously we participated in it in order to keep our percentage ownership steady.
Uh 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 uh, several cryptocurrencies
Milan GA: In the past quarter, and there are numerous initiatives that we're working on.
Milan GA: Uh, we are going to be making it possible for the clients to to fund their accounts.
In 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
Milan GA: obviously at the same time we're working on expanding our ability to offer cryptocurrency trade and 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.
Great, that sounds exciting, good to hear Milan. And guys, thanks for taking my questions.
Milan GA: Thank you.
Speaker Change: Thank you. And our next question will be coming from the line of James yarrow of Goldman Sachs. Your line is open.
James Yarrow: Uh, thanks a lot for taking the questions. I, I just wanted to start with um, any perspectives that you might have on the tokenized equity products that were uh, seeing across a variety of, uh, brokerages and crypto firms for uh, European customers on US Stocks. Maybe you could just talk about the advantages and disadvantages of this product in, in your view. Um, I guess, you know, is it something that you would consider offering? I'm not sure exactly why. But if if so that would be helpful. Um, and then, uh, I guess your perspective on whether this product represents any sort of additional um competition uh in in Europe uh relative to your business.
James Yarrow: So I will focus on 2 different.
Stock tokens that are currently available. 1 note was made available to the European clients of Robin Hood.
James Yarrow: I think they made it available at the beginning of July.
James Yarrow: and I think it probably best if I contrast our offering to the offering that they just launched,
so what they put online in the form of tokens on US Stocks, it's a fundamentally worse product than what our European clients had access to for years,
James Yarrow: Our clients have access to more than 10,000, Rio US, shares and ETFs.
24 hours a day, 5 days a week.
James Yarrow: 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 Robbie in Europe.
As to the cost. If you look at Robin Hood's own key, investor 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 dollar investment cost, the client ten dollars while our clients pay a fraction of that a dollar or so.
James Yarrow: So that's the Robin Hood.
There is also Kraken X share that are available Kraken as you know is a is a significant cryptocurrency Exchange.
James Yarrow: 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 a half a percent each.
And there is a management fee of quarter of a percent per year.
Speaker Change: now, unlike in case of Robin Hood,
Speaker Change: Kraken lets you withdraw the tokens to your own self-custody wallet.
And then trade, the token on the defi Network.
Speaker Change: But that obviously lead to some problems.
There was an article a couple of days ago on Wall Street Journal which talks about the very significant price differences between the tokens and the underlying shares.
And on a, on some days, I think specifically on July 5th. 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, an Amazon X, which is the token issued by Kraken, uh, suffered, even while the dislocation on Jupiter,
Uh there was a lack of liquidity available for the client who submitted a an order for $500 and briefly the Amazons token was trading at Price 100 times larger than the closing price on the previous day.
Speaker Change: so, all in all
Stock tokens at this time, seemed like a great opportunity to do much worse than buying an ordinary share.
Speaker Change: How diverse it was not especially there are some several high flyers in there.
Speaker Change: But so our results are coming from two places right.
Speaker Change: Generally with more accounts and more equity and more participation.
Speaker Change: We see a rise in our general level of both customers, who are shorting stocks never covering.
Speaker Change: Or are customers with margin stocks that we are able to lend out or fully paid stocks and are fully paid program to lend out and and and share the benefits with the customer.
Speaker Change: And then of course, the specials come in on top of that and as I said.
Speaker Change: A few high Flyers Ken.
Speaker Change:
Speaker Change: Make a substantial difference in the overall P&L as to what's going to happen in the future you tell me if the general.
Speaker Change: Market for Ipos, and M&A activity and so forth to leads to.
More of this.
Speaker Change: And these these hot stocks.
Speaker Change: From an interest from Stockholm.
Speaker Change: Stock loan rate standpoint come from.
Speaker Change: The greater proportion of shorts.
Speaker Change: Two available stock to cover that short.
Speaker Change: So the.
Speaker Change: Corporate deals and so forth tend to lead to those kinds of conditions, if those pick up.
Speaker Change: Then the likelihood is there will some of the hard to borrow stocks.
Speaker Change: Great. That's helpful. And then I was hoping you could expand upon the introducing broker comments.
Speaker Change: Thinking about the size of the partners that are coming on and also the backlog. You mentioned also I think was reasonably good just curious how you would characterize that versus say, maybe a year ago and how those conversations have progressed.
Speaker Change: When you look at the number of integrations that will be heard in the second quarter.
Speaker Change: The increase compared to the Q1 of this year.
Speaker Change: The pipeline remains very strong.
Speaker Change: The pipeline includes new entrants to the market.
Speaker Change: Existing firms that they are offering in terms of either new products or countries.
Speaker Change: Our asset classes.
Speaker Change: One interesting note I would make it.
Speaker Change: <unk>.
Speaker Change: Some firms that we spoke to in the past who at that time decided not to go with interactive brokers, but chose a competitor or chose to do in in house build.
Speaker Change: Coming back around to us and <unk>.
Speaker Change: The engagement.
Speaker Change: They do realize that our offering is superior our cost is.
Speaker Change: 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.
Speaker Change: Great. Thank you.
Speaker Change: Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone. Our next question will be coming from the line of Commvault.
Speaker Change: Hey, Debbie your line is open.
Debbie: Hi, good evening.
Speaker Change: Maybe just a question on client credit balances, which grew I think over 6% in the month of June which is the highest since March of 2020.
Speaker Change: Just speak about the main drivers of what you saw in June specifically was it more new cash being deposited into accounts was at rebalancing from existing clients or is there something else driving that significant cash.
Speaker Change: Kris that we saw in June.
Speaker Change: I think it was a combination of those things.
Speaker Change: New cash coming in with <unk>.
Speaker Change: As strong as it has been in the last several months.
Speaker Change: It does have its ups and downs April was particularly strong.
Both in taking in new cash and.
Speaker Change: And that risk off environment of April when a lot of stocks are being sold that generates cash balances and because clients feel comfortable leaving those cash balances with us they simply go up and reinvest them.
Speaker Change: I don't think there was anything else specific to June that was notable.
Speaker Change: Okay.
Speaker Change: Just for a follow up we've seen a recent reacceleration in zero DTE trading percentages in the broader options market was just curious to hear about whether you have been seeing that in your own customer base in recent months.
Speaker Change: Months, and then also curious to hear about your view of rolling out zero DTE on single stocks, what else needs to be done from the brokerage industry standpoint in terms of functionality to be able to offer this and how close are we in terms of being able to see that product hit the market do you think.
Speaker Change: Okay.
Speaker Change: I did not.
Speaker Change: A lot of attention to how the zero ETE percentages.
Speaker Change: Our changing they are roughly the same as they were in the previous quarter I would point out one interesting thing on that is.
Speaker Change: BT options trading.
Speaker Change: <unk> very well and those options are very busy, especially the ones on the S&P 500.
Speaker Change: Index.
Speaker Change: If you look at the forecast ex forecast thanks.
Speaker Change: Just a few weeks ago contract yet some more contracts that are in some sense similar to be zero the options.
Speaker Change: And we released it goes on a number of different indexes and we see significant engagement from our clients.
Speaker Change: Happy with that.
Speaker Change: Yes.
Speaker Change: As far as the stock are concerned.
Speaker Change: A little bit more complicated issue as I mentioned the popular.
Speaker Change: DT options are the index options they settled in cash.
Speaker Change: The stock options.
Speaker Change: Settling two cases.
Speaker Change: Nicole.
Speaker Change: So you get the stock lever if you exercise the long haul.
Speaker Change: Now you can submit your exercise request after the stock market.
Speaker Change: After the main session closes at four o'clock, you have I think half an hour 60 minutes to submit your exercise.
Speaker Change: Functions, so equal there will be some amount of extra volatility in the stock on the days when they publish their earnings are when there is a significant utilization. So you may see some.
Speaker Change: Unexpected exercise them assignment activity on those days.
Speaker Change: And that is an issue that the industry recognizes we ourselves.
Speaker Change: Comments later about that.
Speaker Change: So one way to solve that it would be too.
Speaker Change: Two.
Speaker Change: Zero.
Speaker Change: Stock options et cetera, I mean cash.
Speaker Change: But that would come with its own set of problems. So we will see what the ultimate decision is going to be but there are some issues that the cash settled index options with no path.
Speaker Change: Great. Thank you.
Speaker Change: Thank you and our next question will be coming from the line of Patrick Morley of Piper Sandler Your line is open.
Patrick Morley: Yes, good evening, thanks for taking the question.
Speaker Change: Thomas I had one for you I caught your interview on CNBC before the call here you sounded very bullish I.
Speaker Change: I think you said that you don't really see much that could derail. This rally here and that you could see this rally continue for the next two or three years, so with that in mind I'm, just hoping you could elaborate on what that could mean for overall retail trading activity. If we do see markets continue to grind higher and then in terms of.
Speaker Change: <unk> platform, specifically what are some of the read throughs there.
Speaker Change: That is the environment that we're entering into.
Speaker Change: As I have said.
Speaker Change: I expect <unk> to be very very favorable to brokerage firms in general I think.
Speaker Change: Investment banks Ingenito, specifically for interactive brokers.
Speaker Change: Have a great time for us.
Speaker Change: I think it's a great time for you reaffirm too.
Speaker Change: Okay.
Speaker Change: All of your firms.
Speaker Change: And maybe just a follow up one on crypto.
Speaker Change: I'm a lot I think last quarter, you said that you were somewhat surprised at.
Speaker Change: Just how much how little market share you've taken.
Speaker Change: Since beefing up the crypto offering.
Speaker Change: Just given how much lower.
Speaker Change: Cost the offering was so just curious if that's still what you've seen have you seen any market share gains there and then this.
Speaker Change: Push to kind of build out the offering even more is that a factor of you just recognizing that you think you need to have.
Speaker Change: More robust offering in order to attract more retail customers to the platform.
Speaker Change: Any color there on that strategy would be great. Thanks.
Speaker Change: Well my disappointment in terms of how much market share we are getting in the crypto space.
Speaker Change: What do you mean.
Speaker Change: I am still disappointed given how much less expensive, we may get rolled out by peak dose, but I do expect and I do hope for some asset transfers coming our way, which right now it's impossible. If you already have holdings in crypto currencies and you want to switch brokers you would have to see.
Speaker Change: Well those currencies turn them into cash and that's what you would have to deposit with us. So we're supporting asset transfers should open the doors to some new clients to recognize that our prices are lower and they should bring our assets to our platform that is my hope.
Speaker Change: As to why is it 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 crypto space than the previous one we obviously have to react to that.
Speaker Change: Our in our Investor is balanced clients financial advisors and individual clients do expect to have means to enter that space through us. So we need to do we need to add it to our operating.
Speaker Change: Okay, great that's it for me.
Speaker Change: Thank you. This does conclude today's Q&A session I would like to turn the call back over to Nancy for closing remarks. Please go ahead.
Nancy Stewie: Thank you everyone for participating today as a reminder, this call will be available for replay on our website and we will also be posting a clean version of our transcript on the site tomorrow. Thank you again, and we will talk to you next quarter end.
Nancy Stewie: This concludes today's program. Thank you all for joining you may now disconnect.
Nancy Stewie: Okay.
Nancy Stewie: Okay.