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Schwab (SCHW) October Client Assets, Core New Assets Up Y/Y

Charles Schwab SCHW has released its activity report for October 2021. Total client assets were $7.98 trillion, up 5% from September 2021 and 36% from October 2020. Client assets receiving ongoing advisory services were $3.95 trillion, up 4% from the prior month and 35% year over year.

Core net new assets were $36.8 billion during the reported month. This reflected a decrease of 14% from the previous month but a 44% increase year over year.
Schwab’s average interest-earning assets of $574.2 billion rose 2% from September 2021 and 30% year over year. Average margin balances were $83.3 billion, growing 2% from the previous month and 74% on a year-over-year basis. Average bank deposit account balances totaled $154 billion, up 1% from the previous month and 17% from October 2020.

Schwab opened 397,000 new brokerage accounts in October 2021, increasing 6% sequentially but down 97% from the year-earlier month.

Schwab’s active brokerage accounts totaled 32.8 million at the end of October 2021, relatively stable sequentially but up 13% from the year-ago month. Clients’ banking accounts were 1.59 million, up 1% on a sequential basis and 6% from October 2020. Likewise, the number of corporate retirement plan participants was unchanged from the prior-month level and grew 7% year over year to 2.2 million.

The acquisitions undertaken by Schwab have reinforced its position as a leading brokerage player and are expected to prove accretive to earnings. By offering commission-free trading, the company has been able to witness a rise in client assets and brokerage accounts, which in turn, is improving its market share.

So far this year, shares of Schwab have surged 54.8%, outperforming 39.2% rise of the industry.

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Currently, Schwab carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Competitive Landscape

Some of other brokerage firms that come out with monthly data are Interactive Brokers Group IBKR, Tradeweb Markets Inc. TW, and LPL Financial Holdings Inc. LPLA.

Interactive Brokers’ Electronic Brokerage segment announces performance metrics. For October, the segment (that deals with the clearance and settlement of trades for individual and institutional clients globally) reported a surge in client Daily Average Revenue Trades (DARTs) both on a year-over-year and a sequential basis. Total client DARTs were 2,305,000, which grew 31% from October 2020 and 2% from September 2021.

Tradeweb Markets reported total trading volume of $25.6 trillion in October 2021. Average daily volumes were $1.26 trillion, up 39.4% year over year.

Lee Olesky, the CEO, said: "October 2021 was a record-breaking month for Tradeweb, with incredibly strong results in government bonds, rates derivatives and credit."

LPL Financial is expected to report monthly figures on Nov 18.

LPLA is likely to post decent monthly numbers on the back of solid equity markets performance in October.

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The Charles Schwab (SCHW): Free Stock Analysis Report
Interactive Brokers (IBKR): Free Stock Analysis Report
Tradeweb Markets (TW): Free Stock Analysis Report
LPL Financial (LPLA): Free Stock Analysis Report
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