CMC vs Interactive Brokers Which Outperforms?

CMC Markets and Interactive Brokers are both well-known online brokers that offer a variety of trading options, including stocks. CMC Markets is a UK-based company known for its user-friendly platform and competitive pricing, while Interactive Brokers is an American broker with a strong reputation for its advanced trading tools and low fees. Both brokers cater to different types of traders, so it's important to consider your own trading needs and preferences when choosing between CMC Markets and Interactive Brokers for stock trading.

CMC or Interactive Brokers?

When comparing CMC and Interactive Brokers, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between CMC and Interactive Brokers.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. CMC has a dividend yield of 2.92%, while Interactive Brokers has a dividend yield of 0.47%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CMC reports a 5-year dividend growth of 1.09% year and a payout ratio of 0.00%. On the other hand, Interactive Brokers reports a 5-year dividend growth of 0.00% year and a payout ratio of 10.89%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with CMC P/E ratio at 12.56 and Interactive Brokers's P/E ratio at 27.97. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CMC P/B ratio is 1.01 while Interactive Brokers's P/B ratio is 4.69.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CMC has seen a 5-year revenue growth of 0.08%, while Interactive Brokers's is 0.61%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CMC's ROE at 8.28% and Interactive Brokers's ROE at 18.13%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ¥1501.00 for CMC and $177.55 for Interactive Brokers. Over the past year, CMC's prices ranged from ¥1040.00 to ¥1528.00, with a yearly change of 46.92%. Interactive Brokers's prices fluctuated between $78.93 and $193.42, with a yearly change of 145.05%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.