E*TRADE's (ETFC) November DARTs Decrease 9% From October

E*TRADE Financial (NASDAQ:ETFC) has reported a rise in Daily Average Revenue Trades (DARTs) for November 2018. According to its monthly market activity, the company’s DARTs came in at 275,319, down 9% from the previous month, but up 11% year over year. Notably, derivatives comprised 32% of DARTs in November.

Broker performance is generally measured through DARTs that represent the number of trades from which brokers can expect commission or fees. The fall in DARTs largely reflects investors’ reluctance to invest in equity markets.

At the end of the month under review, E*TRADE’s total number of accounts were approximately 6.9 million, comprising about 4.9 million brokerage accounts, 1.7 million stock plan accounts and 0.3 million banking accounts.

For the reported month, E*TRADE’s total brokerage accounts included 962,487 gross new brokerage accounts. Total brokerage accounts highlight the company’s ability to gain and retain customers who trade and invest.

Moreover, E*TRADE’s net new brokerage assets came in at $16 billion compared with $1.2 billion recorded in the last month.

At the end of November 2018, E*TRADE’s customer security holdings were $350.1 billion, up from the $338.7 billion reported in October. The company’s brokerage-related cash climbed 4% to $53.2 billion compared with the previous month. In addition, bank-related cash and deposits for the company totaled $5.7 billion, up from $5.3 billion in the last month.

Peer Performance

Interactive Brokers Group, Inc.’s (NYSE:IBKR) Electronic Brokerage segment reported a year-over-year rise in DARTs for November 2018. Total client DARTs came in at 907,000, increasing 14% from November 2017 but decreasing 8% from October 2018. Total customer accounts grew 25% year over year and 1% from the prior month to 592,600.

The Charles Schwab Corporation’s (NYSE:SCHW) monthly activity for November 2018 reflects year-over-year improvement. Total client assets came in at $3.4 trillion at the end of the month, increasing 3% from the year-ago quarter. Furthermore, client assets receiving ongoing advisory services were $1.5 trillion, up 7% year over year.

Among others, LPL Financial Holdings Inc. (NASDAQ:LPLA) is expected to release November monthly activity reports later this week.

Our Viewpoint

Though the uncertain macroeconomic environment might lead to lesser trading activities, growth in DARTs and new brokerage accounts will prove beneficial for the company.

E*TRADE currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The company’s shares have lost around nearly 12.1% year to date compared with the 24.3% decline recorded by the industry.

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