E-Trade Sees Further Volume Growth In July
After a decent performance across key metrics in the first half of the year, E*Trade Financial (NASDAQ:ETFC) sustained its growth trend in July. The brokerage saw a 42% year-over-year rise in trading volumes during the month. The acquisition of OptionsHouse in July 2016 continued to contribute to the increase in brokerage accounts and derivative trading volumes, with over 34% of trading volumes attributed to derivatives, in comparison to 25% in July 2016.
Interest earning assets have continued their strong growth, in large part due to the rate hikes over recent months and the expectation of further interest rate hikes going forward. As E-Trade has a higher yield on its interest earning assets (2.7%) relative to most competitors, rate hikes should drive solid revenue growth for the company. With the likelihood of a series of hikes in 2017, we expect the growth in assets to continue.
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