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Schwab's (SCHW) July Metrics Improve on Volatility Markets

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Charles Schwab (SCHW - Free Report) announced monthly activity report for July 2020. The company recorded total client assets of $4.28 trillion, up 4% from June 2020 and 14% from July 2019.

Client assets receiving ongoing advisory services were $2.17 trillion, up 4% from the prior month and 11% year over year. Notably, net new assets plunged 54% sequentially and 42% year over year to $11.2 billion. The figure included an inflow of $8.5 billion related to the acquisition of Wasmer, Schroeder & Company, LLC.

Schwab’s average interest earning assets were $379.5 billion at the end of July 2020, up 1% from June 2020 and 44% from July 2019. The company had 206 million new brokerage accounts in the reported month. This was up 2% from the prior month and 60% from July 2019.

Schwab’s active brokerage accounts totaled 14.22 million at July-end, up 1% sequentially and 18% from the year-ago month. Further, clients’ banking accounts were 1.5 million, rising 1% from June 2020 and 9% from July 2019. The number of retirement plan participants was on par with the prior-month level but up 1% year over year to 1.7 million.

Driven by heightened volatility resulting from the coronavirus outbreak, Schwab continues to record impressive growth in assets. Also, amid the Federal Reserve’s accommodative monetary policy, the company’s financials will likely get support from inorganic growth efforts.

Its shares have gained 2.4% over the past three months, underperforming 17.1% rise recorded by the industry.


Currently, Schwab carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Brokers

E*TRADE Financial (ETFC - Free Report) reported a year-over-year rise in Daily Average Revenue Trades (DARTs) for July 2020. The company’s DARTs came in at 1,013,623, which jumped 288% from the last year. Notably, derivatives comprised 27% of DARTs for the reported month.

Interactive Brokers Group ‘s (IBKR - Free Report) Electronic Brokerage segment reported a substantial surge in DARTs on a year-over-year basis. Total client DARTs were 1,795,000, surging 124% from July 2019 but declining 4% from June 2020.

LPL Financial Holdings Inc.’s (LPLA - Free Report) total brokerage and advisory assets of $792 billion at July 2020-end grew 4% from the prior month and 11% year over year. Of the total assets, brokerage assets were $399.2 billion and advisory assets totaled $392.7 billion.

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