Why Does Interactive Brokers Automate Everything?

David Senra, reading a profile of Thomas Peterffy, says Interactive Brokers automates everything so it can charge fees so low that rivals no longer try to compete on price.

By 2017 the brokerage had eclipsed Timber Hill, and Peterffy shut the market-making operation after a 40-year run that had made it the world's largest options market maker. What remains is a brokerage with 4 million customers, over $700 billion in client assets, and 3,000 employees, most of them engineers. In 2024 it generated $3.7 billion in profits on $5.2 billion in revenue. He took the company public at a $12 billion valuation, and it is now worth over $120 billion. Interactive Brokers stays the platform of choice for hedge funds and professional traders. Peterffy calls the secret hard work and common sense. He has never been to Costco and has never read a business book. In 2019, on his 75th birthday, he stepped down as CEO. At 81 he is chairman, still owns nearly 70% of the business, and runs sales and marketing because nobody wants to do it. He says he knows nothing about that work and is learning as he goes. What he is most proud of is the money the firm saves people by making markets more efficient.

The profile's writer does the math after Peterffy says he had not checked the markets and the shares were up $1.44. During the three hours they talked, that move came to $1.7 billion.