Futu vs Interactive Brokers Which Is Superior?

When it comes to investing in the stock market, two popular options for traders are Futu and Interactive Brokers. Futu Holdings Limited is a rapidly growing fintech company that offers a user-friendly mobile app for trading stocks and other financial instruments. On the other hand, Interactive Brokers is a well-established brokerage firm known for its advanced trading platform and low fees. Both platforms have their own unique features and benefits, so it's important for investors to carefully consider their individual needs and preferences before choosing between Futu and Interactive Brokers for their stock trading needs.

Futu or Interactive Brokers?

When comparing Futu 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 Futu 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. Futu has a dividend yield of 0.29%, 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. Futu reports a 5-year dividend growth of 0.00% 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 Futu P/E ratio at 21.03 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. Futu P/B ratio is 3.29 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, Futu has seen a 5-year revenue growth of 4.80%, while Interactive Brokers's is 0.61%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Futu's ROE at 16.86% 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 $83.86 for Futu and $177.55 for Interactive Brokers. Over the past year, Futu's prices ranged from $43.61 to $130.50, with a yearly change of 199.24%. 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.