Interactive Brokers Is Holding $930 Billion of Customer Money. Here's What That Earns at Today's Rates.
The brokerage earns substantial interest income from its active customers.
Interactive Brokers (NASDAQ: IBKR) currently holds a staggering $930 billion in customer equity, marking a 40% increase last quarter and positioning the firm as one of the fastest-growing brokerages globally in terms of asset value. As a brokerage, IBKR generates earnings through various interest income streams. The first method involves investing idle cash balances into short-term Treasury bonds, sharing some proceeds with customers while retaining the rest.
Additionally, IBKR earns interest income by providing margin loans to customers, backed by their equity, as well as short-sale loans.
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