Interactive Brokers Group, Inc. (IBG, Inc.) operates as an automated global electronic broker.
The company custodies and services accounts for hedge and mutual funds, exchange-traded funds ('ETFs'), registered investment advisors, proprietary trading groups, introducing brokers and individual investors. The company specializes in routing orders and executing and processing trades in stocks, options, futures, foreign exchange instruments ('forex'), bonds, mutual funds, ETFs and precious metals o...
Interactive Brokers Group, Inc. (IBG, Inc.) operates as an automated global electronic broker.
The company custodies and services accounts for hedge and mutual funds, exchange-traded funds ('ETFs'), registered investment advisors, proprietary trading groups, introducing brokers and individual investors. The company specializes in routing orders and executing and processing trades in stocks, options, futures, foreign exchange instruments ('forex'), bonds, mutual funds, ETFs and precious metals on more than 160 electronic exchanges and market centers in 36 countries and 278 currencies seamlessly around the world.
In addition, the company's customers can use its trading platform to trade certain cryptocurrencies through third-party cryptocurrency service providers that execute, clear and custody the cryptocurrencies. In the United States of America ('U.S.'), the company conducts its business primarily from its headquarters in Greenwich, Connecticut and from Chicago, Illinois. Abroad, the company conducts its business through offices located in Canada, the United Kingdom, Ireland, Switzerland, Hungary, India, China (Hong Kong and Shanghai), Japan, Singapore and Australia.
IBG, Inc. is a holding company whose primary asset is the ownership of approximately 25.8% of the membership interests of IBG LLC, the current holding company for its businesses. IBG, Inc. is the sole managing member of IBG LLC.
As an electronic broker, the company executes, clears and settles trades globally for both institutional and individual customers. Capitalizing on the company's proprietary technology, the company's systems provide its customers with the capability to monitor multiple markets around the world simultaneously and to execute trades electronically in these markets at a low cost in multiple products and currencies from a single unified platform. The company offers its customers access to all tradable classes of primarily exchange-listed products, including stocks, options, futures, forex, bonds, mutual funds, ETFs, precious metals and cryptocurrencies traded on more than 160 electronic exchanges and market centers in 36 countries and in 28 currencies seamlessly around the world.
Since the launching of the company's electronic brokerage business in 1993, it has grown to approximately 3.3 million institutional and individual brokerage customers.
The company is able to provide its customers with high-speed trade execution at low commission rates, in large part because of the company's proprietary technology. As a result of the company's advanced electronic brokerage platform, the company is especially attractive to sophisticated and active investors.
The company's customers can choose the following trading platforms to match their trading style and expertise:
IBKR Desktop – IBKR Desktop is the company's newest trading platform, built from the ground up using modern technology, and a fresh user interface design. This new platform provides a clean, intuitive experience, making it easy for traders of all levels to navigate. It offers a highly customizable trading experience with a broad array of tools for technical and fundamental analysis, sophisticated charting capabilities, and advanced order types, including conditional and algorithmic orders.
IBKR Trader Workstation (TWS) - The TWS is the company's flagship desktop trading platform, designed for seasoned, active traders who trade multiple products and require power and flexibility. The TWS Mosaic interface provides intuitive out-of-the-box usability with quick and easy access to comprehensive trading, order management, chart, watchlist and portfolio tools all in a single, customizable workspace.
IBKR Mobile - The IBKR Mobile app provides experienced traders powerful trading tools and the same market-moving information as the company's desktop TWS trading platform. The company's mobile app provides the functionality needed to trade and manage accounts from anywhere.
IBKR Client Portal – The IBKR Client Portal is an easy-to-use web-based platform that requires no downloads. It gives customers access to every resource they need to view, trade and manage their account all with a single login.
IBKR GlobalTrader – The IBKR GlobalTrader is a streamlined mobile trading app to trade stocks, EFTs, options and cryptocurrencies worldwide. Customers can deposit in their local currency and trade stocks at 90+ exchanges and options at 30+ market centers around the world. Customers can also trade select U.S. ETFs around the clock, plus cryptocurrencies like Bitcoin, Bitcoin Cash, Ethereum and Litecoin, all from their mobile device.
IBKR APIs - For the company's more sophisticated customers, IBKR APIs allows them to build custom trading applications and automate any part of the trading process to their specifications. The company offers APIs for every experience level from its easy-to-use Excel API to the company's institutional grade FIX API.
The company’s key product offerings include:
IBKR Pro is the core IBKR service designed for sophisticated investors. IBKR Pro offers the lowest cost access to stocks, options, futures, forex, bonds, mutual funds, ETFs, precious metals and cryptocurrencies from a single unified platform with no added spreads, ticket charges, account minimums or platform fees.
IBKR Lite provides unlimited commission-free trades on U.S. exchange-listed stocks and ETFs and low-cost access to global markets without required account minimums or platform fees to participating U.S. customers. IBKR Lite was designed to meet the needs of investors who are seeking a simple, commission-free way to trade U.S. exchange-listed stocks and ETFs and do not wish to consider its efforts to obtain greater price improvement through the company’s IB SmartRouting system.
IBKR Universal Account - From a single point of entry in their IBKR Universal Account, the company's customers are able to transact in 28 currencies, across multiple classes of tradable, primarily exchange-listed products traded on more than 160 electronic exchanges and market centers in 34 countries around the world seamlessly. The company's offering features a suite of cash management services, including:
Request for Payment Service - Through this new banking service, the U.S. customers can make instant deposits, 24 hours a day, from their mobile banking app or other bank portal to fund their brokerage account with the company. Funds deposited via Request for Payment are immediately available for trading. The service is available to customers with accounts at several major U.S. banks and, over time, other banks will be added.
Non-U.S. Dollar Currency Deposits – The company supports a host of deposit types using local payment systems outside the U.S. to facilitate convenient account funding for non-U.S. customers.
Direct Deposit and Mobile Check Deposit - The company's Direct Deposit program allows customers to automatically deposit paychecks, pension distributions and other recurring payments to their (non-retirement) brokerage account with the company. In addition, the U.S. customers can use the company's Mobile Check Deposit to directly deposit checks drawn on a U.S. bank.
Insured Bank Deposit Sweep Program - The company's Insured Bank Deposit Sweep Program provides eligible customers with up to $2,500,000 of Federal Deposit Insurance Corporation ('FDIC') insurance on their eligible cash balances in addition to the existing $250,000 Securities Investor Protection Corporation ('SIPC') coverage for total coverage of $2,750,000. Customers continue earning the same competitive interest rates applied to cash held in their brokerage accounts with the company. The company sweeps each participating customer's eligible cash balances daily to one or more banks, up to $246,500 per bank, allowing for the accrual of interest and keeping within the FDIC protected threshold. Cash balances above $2,750,000 remain subject to safeguarding under the SEC's Customer Protection Rule 15c3-3.
Investors’ Marketplace – The Investors’ Marketplace is an electronic marketplace that brings together individual investors, financial advisors, money managers, fund managers, research analysts, technology providers, business developers and administrators, allowing them to interact to form connections and conduct business.
Mutual Fund Marketplace – The Mutual Fund Marketplace offers the company’s customers access to more than 43,000 mutual funds worldwide, including more than 18,000 no-transaction-fee funds from more than 600 fund families.
Bond Marketplace - The Bond Marketplace allows customers to search for the best yields from a vast universe of over one million bonds from issuers in the Americas, Europe and Asia/Pacific. The company provides direct market access at a low cost to a wide array of corporate, government and municipal securities. The company's customers obtain competitive bids and offers with low, transparent commissions and no hidden mark-ups.
Cryptocurrency – Customers of Interactive Brokers LLC, including both individuals and advisors, can trade Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and Bitcoin Cash (BCH) through Paxos Trust Company or Zero Hash LLC, which execute, clear and custody the cryptocurrencies, alongside other asset classes on a single unified platform. In Hong Kong, customers can trade and hold BTC and ETH in their account with Interactive Brokers Hong Kong Limited (IBHK). Customers of Interactive Brokers (U.K.) Limited can trade BTC, ETH, LTC, and BCH through Paxos Trust Company.
Forecast and Event Contracts – IBKR ForecastTrader is the company's web-based platform for trading forecast contracts from ForecastEx LLC, (ForecastEx), a CFTC-registered exchange and the company's wholly-owned subsidiary, as well as event contracts on select CME futures markets. IBKR ForecastTrader allows customers to trade their opinion on a specific question with a yes or no outcome, while earning an interest-like incentive coupon based on the daily closing price of each contract.
Fractional Trading – Fractional Trading allows customers to buy and sell any eligible U.S., Canadian, or European stocks (or ETFs, where available), using either a specified cash amount or fractional shares, which are stock units that amount to less than one full share. With fractional shares, there is no minimum for European shares and customers can invest in U.S. shares with as little as $1.00. This functionality allows customers to experiment with trading and investing without committing substantial sums of money and learn about building and rebalancing diversified portfolios.
U.S. Spot Gold – Customers can trade U.S. Spot Gold alongside other asset classes from a single unified platform. In addition, its customers have access to efficient pricing in quantities as small as one ounce and can request physical delivery of their U.S. Spot Gold position.
No Transaction Fee Program for Exchange-Traded Funds - The company offers a no transaction fee program for ETFs that reimburses IBKR Pro customers and eligible non-U.S. customers for commissions paid on ETF shares held for at least 30 days.
Overnight Trading Hours – Customers can trade over 10,000 U.S. stocks and ETFs, U.S. Equity Index futures and options, U.S. Treasurys, global corporate bonds, European government bonds, and United Kingdom (U.K.) gilts nearly 24 hours a day, five days a week, enabling them to react immediately to market-moving news and conveniently trade at almost any time. It also provides customers in Asia with access to the U.S. Equity markets during their trading day.
For all customers, the company's platform offers:
Low Costs - The company provides its customers with among the industry's lowest overall transaction costs in two ways. First, the company offers among the lowest execution, commission and financing costs in the industry. Second, the company's IBKR Pro customers benefit from the company's advanced routing of orders designed to achieve the best available trade price. In addition, customers earn interest on their uninvested cash balances above $10,000 (or the equivalent in foreign currency).
IB SmartRouting - IB SmartRouting retains control of the customer's order, continuously searches for the best available price and, unlike most other routers, dynamically routes and re-routes all or parts of a customer's order to achieve optimal execution and among the lowest execution and commission costs in the industry. The company offers Transaction Cost Analysis reporting to allow customers to track execution performance using multiple criteria. The company's IBKR Pro customers benefit from the company's advanced order routing technology for all trades, while the company's IBKR Lite customers benefit from this technology for their trades in products not eligible for IBKR Lite.
Automated Risk Controls - Throughout the trading day, the company calculates margin requirements for each of the company's customers on a real-time basis across all product classes and across all currencies. The company's customers are alerted to approaching margin violations and if a customer's equity falls below what is required to support that customer's margin, the company attempts to automatically liquidate positions to bring the customer's account into margin compliance. This is done to protect the company, as well as the customer, from excessive losses.
Flexible and Customizable System - The company's platform is designed to provide an efficient customer experience, beginning with a highly automated account opening process and continuing through fast trade execution and reporting. The company's sophisticated interface provides interactive real-time views of account balances, positions, profits or losses, buying power and 'what-if' scenarios to enable the company's customers to more easily make informed investment decisions and trade effectively. The company's system is configured to remember the user's preferences and is specifically designed for multi-screen systems. When away from their main workstations, customers can conveniently access their accounts through the company's IBKR Mobile platforms.
Securities Financing Services - The company offers a suite of automated Stock Borrow and Lending tools, including the company's depth of availability, transparent rates, global reach and dedicated service representatives. In addition, the company's Stock Yield Enhancement Program allows its customers to lend their fully-paid stock shares to the company in exchange for cash or the U.S. Treasury securities collateral. In turn, the company lends these stocks in exchange for collateral and earn stock lending fees. The company pays its customers interest on the collateral value generally equal to 50% of a market-based rate for lending the shares. This allows customers holding fully-paid long stock positions to enhance their returns.
Global Outsourced Trading Desk – The company offers broker-assisted trading through its Global Outsourced Trading Desk. The desk helps traders execute large or complex orders, and monitors trades when customers are unable to do so. The desk sources liquidity, brings SPX market color from the exchange trading pit, offers price discovery services, and helps customers calibrate and execute complex algorithmic trading strategies.
Automated Currency Conversions – Customers can execute trades in any of the company's supported currencies, even if they do not have the corresponding cash balance in that currency, and can elect it to automatically perform the necessary forex transaction to settle the trade.
Recurring Investments – Customers can use the company's Recurring Investments tool to set up and execute a predetermined investment strategy by automatically investing funds on a recurring schedule. Customers can create recurring investments for almost any U.S., Canadian, or European stock or ETF.
Dividend Reinvestments – Customers can reinvest cash dividends into additional full or fractional shares of U.S. and Canadian shares of stock held in their account.
IBKR Campus – IBKR Campus helps customers learn about the markets, products, and tools available through the company's platforms. IBKR Campus offers self-directed courses at the Traders’ Academy, live and recorded webinars, the company's Traders’ Insight market commentary blog, IBKR Podcasts, which is a podcast series featuring interviews with financial industry thought leaders, the IBKR Quant Blog, IBKR-API, the source for all IBKR API documentation, and the Student Trading Lab, which allows educators to bring real-world trading experiences to their classroom. In addition, the company provides content to Coursera, an online provider of learning content, for a certificate program called Practical Guide to Trading.
Promotional offerings include:
IBKR Refer a Friend Program - Under the Refer a Friend program, the company encourages existing customers to refer friends and family to IBKR. The referring customer can earn a flat fee payment of $200 while the new customer can receive up to $1,000 in IBKR stock. The specific program details and eligibility requirements are described on the company's website.
Analytical offerings on the company's platform include:
IBKR GlobalAnalyst – IBKR GlobalAnalyst is designed for investors who are interested in new opportunities to diversify their portfolio, and in discovering undervalued companies that may have greater growth potential. The tool’s World Map Screener lets customers easily find stocks that match their strategies from across a universe of over 70,000 stocks worldwide, while the World Data Screener lets customers compare the relative value of global stocks in the same currency, and find new opportunities.
PortfolioAnalyst – The company's PortfolioAnalyst reporting tool allows customers to consolidate, track, and analyze their portfolios, offering multi-custody solutions, advanced reporting, global support, benchmarks, risk metrics, GIPS verified returns, and powerful on-the-go analytics. PortfolioAnalyst includes Retirement Planning and Budgeting tools, and provides U.S.-based advisors with an AI Commentary Generator designed to help advisors with customer portfolio performance reporting, market updates, and ticker-specific news.
IB Risk Navigator - The company offers to all customers its real-time market risk management platform that unifies exposure across multiple asset classes around the globe. The system is capable of identifying overexposure to risk by starting at the portfolio level and drilling down into successively greater detail within multiple report views. Report data is updated every ten seconds or upon changes to portfolio composition. Predefined reports allow the summarization of a portfolio from different risk perspectives, providing views of Exposure, Value at Risk ('VaR'), Delta, Gamma, Vega and Theta, profit and loss, and position quantity measures. The system also offers customers the ability to modify positions through 'what-if' scenarios that show hypothetical changes to the risk profile.
Portfolio Builder – Portfolio Builder supports its customers in setting up an investment strategy based on research and rankings from top buy-side providers, and fundamental data; use filters to define the universe of equities that will comprise their strategy, and back-test their strategy using up to three years of historical performance; work in hypothetical mode to adjust the strategy until the historical performance meets their standards, and with the click of a button, let the system create the orders to invest in a strategy, and track its performance in their portfolio.
Securities Lending Dashboard – Securities Lending Dashboard is designed to help customers assess the short-selling activity for specific securities, and inform trading decisions. The dashboard allows sophisticated individual and institutional investors, including hedge funds, to view an expanded universe of securities lending data across key metrics. The Securities Lending Dashboard complements IBKR’s Securities Loan and Borrow system, which is a fully electronic and actionable self-service utility that lets customers search for the availability of shortable securities from within IBKR trading platforms at no cost.
Interactive Analytics and IB Option Analytics – The company offers its customers state-of-the-art tools, which include a customizable trading platform, advanced analytic tools, and over 100 sophisticated order types and algorithms. It also provides a real-time option analytics window that displays values reflecting the rate of change of an option’s price with respect to a unit change in each of several risk dimensions.
Probability Lab – Probability Lab provides customers with an intuitive, visual method to analyze market participants’ future stock price forecasts based on current option prices. This tool compares a customer’s stock price forecast versus that of the market, and scans the entire option universe for the highest Sharpe ratio multi-leg option strategies that take advantage of the customer’s forecast.
Goal Tracker – Interactive Advisors’ Goal Tracker projects the hypothetical performance of a portfolio and monitors how likely it is that the portfolio might achieve the goal. Customers can adjust inputs, such as monthly contribution amount, goal target date, or the cost or outflow associated with the goal, to estimate the likelihood of achieving a goal.
AI News Summaries – Customers outside the U.S. have access to AI News Summaries that use generative AI to quickly summarize the key points of news published by select providers, saving time and allowing them to react rapidly to changing market conditions.
Sustainable Investing Tools
IMPACT by Interactive Brokers – IMPACT by Interactive Brokers (IMPACT App) is a unique, simple and intuitive mobile app that helps customers easily align their investment portfolio with their values. The IMPACT App is intended to allow customers to select their personal investment criteria from thirteen impact goals and principles and to exclude investments based on business practices they would like to avoid.
Impact Dashboard – The Impact Dashboard is intended to help customers evaluate and invest in companies that align with their principles. Customers can select investments they care about and can measure how both individual securities and their overall portfolio measure up against their criteria.
ESG Scores – ESG Scores from Refinitiv give customers a separate set of tools to help them make investment decisions. Companies are scored along several dimensions, such as reducing emissions and supporting human rights, and customers can easily see how companies rank both overall and on each dimension.
The company caters to various customer groups with specific service needs.
For advisors, the company offers:
Model Portfolios – Model Portfolios offer advisors an efficient and time-saving approach to investing customer assets. They allow advisors to create groupings of financial instruments based on specific investment themes, and then invest customer funds into these models.
IBKR Allocation Order Tool – The IBKR Allocation Order Tool streamlines the creation, execution and allocation of group orders. The tool provides advisors with a single screen to enter trade allocations quickly across many customer accounts, advisors or strategies; allocate total quantity or cash quantity for user-specified values proportionally or equally; and modify orders or allocations on the fly. In addition, customers can use the Allocation Order Tool to project, preview and allocate trades to take advantage of potential capital losses for all or some of an advisor’s invested customers.
Rebalance Tool – The Rebalance Tool lets advisors automatically rebalance all their accounts, a single sub-account or a user-defined Account Group, which includes a subset of accounts, by redistributing percentages of positions in their sub-portfolio(s) that make up the current net liquidation value.
Commentary Generator – The company's AI-powered Commentary Generator helps U.S.-based financial advisors streamline workflow and improve efficiency by creating customer-specific performance reports, and summarizing the latest and ticker-specific news from select providers.
Tax Loss Harvesting – the company’s Tax Loss Harvest tool helps advisors to potentially reduce their customers’ tax liabilities by harvesting losses across multiple assets for multiple customers at the same time.
ESG Impact Profile – The ESG Impact Profile helps advisors understand customer preferences for socially responsible and impact investing. Advisors’ customers can select personal investment criteria from thirteen impact values and principles and exclude investments based on ten categories.
IBKR Client Risk Profile – IBKR Client Risk Profile is designed to help advisors determine the most suitable investments for their customers, based on each customer’s risk tolerance. This information is collected through a custom-designed questionnaire. Advisors can view the scores through the Advisor Portal and create custom pre-trade allocation groups and profiles in Trader Workstation to place orders and allocate trades for customers with similar risk profiles.
Custom Indexing – Custom Indexing allows advisors to create custom portfolios for their customers that directly hold the underlying securities of an index, rather than purchasing a traditional index fund. This gives advisors the ability to customize portfolios to align with specific investment objectives.
Employee Plan Administrator SIMPLE IRA – The Employee Plan Administrator account allows U.S. advisors to offer self-employed individuals and companies of less than 100 employees a Savings Investment Match Plan for Employees Individual Retirement Account (SIMPLE IRA).
For hedge funds, the company offers:
High-Touch Prime Brokerage Services – The company offers a High-Touch Prime Brokerage service for hedge funds, with benefits that include a dedicated Relationship Manager; access to experts in risk/margin, compliance, securities finance, corporate actions, proxy, clearing, transfers and tax; expedited request handling; and 24/5 access to a Global Outsourced Trading Desk for order execution.
For introducing brokers and advisors, the company offers:
White Branding – The company's large financial advisor and broker-dealer customers may ‘white brand’ its trading interface, account management, and reports with their firm’s identity. Broker-dealer customers can also select from among the company's modular functionalities, such as order routing, trade reporting, or clearing, on specific products or exchanges where they may not have up-to-date technology to offer a complete global range of services and products.
Streamlined Client Service Program – The Streamlined Client Service Program offers a new level of service for brokers and advisors who want to handle tasks for their customers, with a simplified process for approving funding requests and signing agreements. The full list of available tasks includes authorization to update or change account information, account settings, trading permissions, tax forms, banking and transfer instructions; authorization to vote shares and make elections regarding positions; authorization for special programs and alternative investments; and request to send electronic notices, confirmations, account statements and certain communications only to the broker or advisor.
For customers looking for online advisory services, the company offers:
Interactive Advisors – Interactive Advisors evaluates and recruits registered financial advisors, analyzes their investment track records, and groups them by their risk profile. Investors who are interested in having their individual accounts robo-traded are grouped by their risk and return preferences. Investors can assign their accounts to be traded by one or more advisors. Interactive Advisors also offers its customers Smart Beta Portfolios which combine the benefits of actively managed fund stock selection techniques with passive ETFs low-cost automation to provide broad market exposure and potentially higher returns, as well as Socially Responsible Investing.
Transaction Processing
The company's transaction processing is automated over the full life cycle of a trade. Its fully automated IB SmartRouting system searches for the best possible combination of prices available at the time a customer order is placed, and immediately seeks to execute that order electronically, or send it where the order has the highest possibility of execution at the best price. The company's market making software generates and disseminates to the exchanges and market centers, in which it still operates, continuous bid and offer quotes on tradable, exchange-listed products.
When an order is executed, the company's systems capture and deliver this information back to the source, either to the customer via the brokerage system, or to the market making system, generally within a fraction of a second. Simultaneously, the trade record is written into the company's clearing system, where it flows through a chain of control accounts that allow it to reconcile trades, positions, and money until the final settlement occurs. The company's integrated software tracks other important activities, such as dividends, corporate actions, options exercises, securities lending, margining, risk management, and funds receipt and disbursement.
IB SmartRouting
IB SmartRouting searches for the best destination price in view of the displayed prices, sizes, and accumulated statistical information about the behavior of market centers at the time an order is placed, then immediately seeks to execute that order electronically. Unlike other smart routers, IB SmartRouting never relinquishes control of the order, and constantly searches for the best price. It continuously evaluates fast-changing market conditions and dynamically re-routes all or parts of the order, seeking to achieve optimal execution. For example, for U.S. options, IB SmartRouting can represent each leg of a spread order independently, if needed, and in that event, enters each leg at the best possible venue. IB SmartRouting Autorecovery re-routes a customer’s U.S. options order in the case of an exchange malfunction, and the company absorbs the risk of double executions. In addition, IB SmartRouting checks each new order to see if it could be executed against any of its pending orders in the company's automated trading system (ATS). As the system continues to gain more users, IB SmartRouting and the IBKR ATS facilities become more important for customers in a world of multiple exchanges, market centers, and penny-priced orders because it increase the possibility of the best possible executions for the company's customers ahead of customers of other brokers. As a result of this feature, the company's customers have a greater chance of executing limit orders and can do so sooner than those who use less sophisticated routers.
Clearing and Margining
The company's activities in the U.S. are entirely self-cleared. The company is a clearing member of OCC (formerly known as the Options Clearing Corporation), The Depository Trust and Clearing Corporation, the Chicago Mercantile Exchange Clearing House, and ICE Clear U.S. In addition, the company is fully or partially self-cleared in Canada, the United Kingdom, Switzerland, France, Germany, Belgium, Austria, the Netherlands, Spain, Norway, Sweden, India, Hong Kong, Japan and Australia. Additionally, the company is members of ForecastEx, a CFTC- registered Designated Contract Market and Derivatives Clearing Organization.
Customers
The company's customers primarily fall into two groups based on services provided, both of which take advantage of the company's low commissions, as well as the company's best price execution. Cleared customers, the large majority of the company's customers, use the company's trade execution and clearing services, low financing rates, high interest paid (when benchmark rates are sufficiently above zero) and, under the company's IBKR Lite offering, commission-free trades. Non-cleared customers use the company's trade execution services while choosing to clear with another prime broker or a custodian bank.
The company services approximately 3.34 million cleared customer accounts and have customers residing in over 200 countries and territories around the world. The company's target customer is one who requires the latest in trading technology and worldwide access, and who expects low overall transaction and financing costs and market rate interest on idle cash balances. The company's customers are mainly consisted of individuals, trading desk professionals, electronic retail brokers, hedge funds, mutual funds, financial advisors, proprietary trading firms, and introducing brokers and banks that require global access.
Regulation
As registered U.S. broker-dealers, Interactive Brokers LLC ('IB LLC'), IBKR Securities Services LLC ('IBKRSS') and Interactive Brokers Corp. are subject to the rules and regulations of the Exchange Act, and as members of various exchanges, the company is also subject to such exchanges' rules and requirements. Additionally, IB LLC is subject to the Commodity Exchange Act and rules promulgated by the Commodity Futures Trading Commission ('CFTC') and the various commodity exchanges of which it is a member. The company is also subject to the requirements of various self-regulatory organizations such as the Financial Industry Regulatory Authority ('FINRA'), the Chicago Mercantile Exchange ('CME') and the National Futures Association ('NFA'). ForecastEx, an exchange and clearinghouse for forecast contracts, is registered with the CFTC as a Designated Contract Market and Derivatives Clearing Organization. The company's foreign subsidiaries are similarly regulated under the laws and institutional frameworks of the countries in which they operate.
As certain of the company's subsidiaries are members of FINRA, the company is subject to certain regulations regarding changes in control of the company's ownership.
IB LLC is subject to the Uniform Net Capital Rule (Rule 15c3-1) under the Exchange Act and to the CFTC's minimum financial requirements (Regulation 1.17) under the Commodities Exchange Act. Additionally, Interactive Brokers Canada Inc. ('IBC') is subject to the Canadian Investment Regulatory Organization ('CIRO') risk adjusted capital requirement; Interactive Brokers (U.K.) Limited ('IBUK') is subject to the United Kingdom's ('U.K.') Financial Conduct Authority ('FCA') financial resources requirement; Interactive Brokers Ireland Limited ('IBIE') is subject to the Central Bank of Ireland ('CBI') financial resources requirement; IBKR Financial Services AG ('IBKRFS') is subject to the Swiss Financial Market Supervisory Authority ('FINMA') eligible equity requirement; Interactive Brokers Central Europe Zrt. ('IBCE') is subject to the Hungarian National Bank ('MNB') financial resource requirement; Interactive Brokers (India) Private Limited ('IBI') is subject to the National Stock Exchange of India net capital requirements; Interactive Brokers Hong Kong Limited ('IBHK') is subject to the Hong Kong Securities and Futures Commission ('SFC') financial resource requirement; Interactive Brokers Securities Japan, Inc. ('IBSJ') is subject to the Japanese Financial Services Agency ('FSA') capital requirements; Interactive Brokers Singapore Pte. Ltd. ('IBSG') is subject to the Monetary Authority of Singapore ('MAS') capital requirements; and Interactive Brokers Australia Pty Limited ('IBA') is subject to the Australian Securities Exchange ('ASX') liquid capital requirement.
To conduct customer activities, IB LLC is obligated under rules mandated by its primary regulators, the SEC and the CFTC, to segregate cash or qualified securities belonging to customers. In accordance with the Securities Exchange Act of 1934, IB LLC is required to maintain separate bank accounts for the exclusive benefit of customers. In accordance with the Commodity Exchange Act, IB LLC is required to segregate all monies, securities and property received from commodities customers in specially designated accounts. IBC, IBUK, IBIE, IBCE, IBI, IBHK, IBSJ, IBSG and IBA are subject to similar requirements within their respective jurisdictions.
The SEC, CFTC, foreign regulators, and the various exchanges and self-regulatory organizations, of which the company's operating subsidiaries are members, have passed numerous AML and customer due diligence rules.
As required by the USA Patriot Act and other rules, the company has established comprehensive AML and customer identification procedures, and designated AML Compliance Officers for each electronic brokerage subsidiary; and the company provides formal AML training to the company's AML, customer facing, and other relevant employees, and conduct regular independent audits of the company's AML programs. The company's AML screening is conducted using a mix of automated and manual reviews and has been structured to comply with regulations in various jurisdictions. The company collects required information through its new account opening process and screen accounts against databases for the purposes of identity verification and for review of potential negative information and appearance on government sanction lists, including the Office of Foreign Assets and Control, Specially Designated Nationals and Blocked Persons lists and several other global, United Nations, European Union ('EU') and other non-U.S. sanction lists. Additionally, the company has designed and implemented restrictions to prevent certain types of high-risk activity, including potentially manipulative patterns of trading or higher risk patterns of money movement. The company generates and reviews a sophisticated suite of surveillance reports and queues to identify potential money laundering, market manipulation or abuse, fraud and other suspicious activities.
The company’s international subsidiaries are subject to extensive regulation in the various jurisdictions where they have operations. The most significant of its international subsidiaries are: IBC, registered to do business in Canada as an investment dealer; IBUK, registered to do business in the U.K. as a broker; IBIE, registered in Ireland as an investment firm; IBKRFS, registered to do business in Switzerland as a securities dealer; IBI, registered to do business in India as a stock broker; IBHK, registered to do business in Hong Kong as a securities dealer; IBSJ, registered in Japan as a financial instruments firm; IBSG, registered in Singapore as a capital markets firm; and IBA, registered to do business in Australia as a securities dealer and futures broker.
History
Interactive Brokers Group, Inc. was founded in 1977. The company was incorporated in 2006.
