Interactive Brokers reported 1.3 basis point all-in trading costs for PRO clients executing U.S. Reg.-NMS stocks in February 2026, with average trade size of $24,009. This represents a 32% decrease from January's 1.9 basis points on $21,785 average trades.
The 1.3 basis point figure includes execution costs, clearing fees, exchange charges, and regulatory assessments. On a $24,009 trade, total costs equal $3.12. Traditional brokers typically charge $5-10 in commissions alone before adding the same regulatory and exchange fees Interactive Brokers already includes.
Rolling twelve-month averages show sustained low-cost performance: 2.6 basis points in January and 2.7 basis points in February. Interactive Brokers attributed the cost structure to "four decades of focus on technology and automation" enabling a sophisticated client platform.
Exchange, clearing and regulatory fees consume 58-60% of futures commissions industry-wide, leaving minimal room for broker margin compression without matching Interactive Brokers' automation levels. Competitors charging $5-10 per equity trade face a structural disadvantage: their commission alone exceeds Interactive Brokers' all-in cost by 300-700%.
The cost gap creates two strategic paths for traditional brokers. First, invest heavily in AI and machine learning systems to automate trade execution, custody, and client servicing infrastructure. Second, exit retail equity trading entirely and focus on higher-margin products like options, managed accounts, or advisory services.
Market share data over the next 12-24 months will reveal which brokers can bridge the automation gap. Firms announcing technology investments without subsequent cost reductions will likely lose clients to automated platforms. Those maintaining high-cost structures risk commoditization of their core business.
Interactive Brokers' sub-3 basis point threshold establishes a competitive benchmark that makes traditional brokerage models economically unviable. Brokers lacking comparable technology infrastructure face pressure to transform operations or concede market segments to automated competitors.