Mike Arnold
Long only, small-cap, tech, growth at reasonable price

Tale Of Two Stories At Interactive Brokers

Interactive Brokers (NASDAQ:IBKR) is comprised of two businesses: (1) an electronic brokerage and (2) a market maker. I wrote in September that I thought shares were 20 to 30% undervalued, and included a potential catalyst in the form of a liquidation of the market maker business. The market maker currently holds ~$2.5 billion in excess capital, of which the public float's share is worth some $310 million. Note that the IBKR shares that trade publicly represent 12.4% of the enterprise, the remainder of which is largely held by CEO Thomas Peterffy. For more information, see the Q3 2013 10-Q.

Earlier in January, I advised readers to take some gains off the table in IBKR because the...

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