eTrade 2015 Annual Report Download - page 4

On our active trader platform, E*TRADE Pro, we made a
number of upgrades to further equip retail investors with
professional-grade tools. The big ticket items include a
new Options Analyzer, which simplifies complex derivative
strategies, and our new Margin Analyzer, which provides
greater clarity by way of a detailed overview of buying power,
displaying real-time requirements for each position in a
customer’s portfolio.
With each passing day, our mobile platforms increase in
importance and engagement. In 2015, customers executed
a record 14 percent of total daily average revenue trades
(DARTs) through this channel. Investors and traders
increasingly seek an experience that rivals the desktop in
terms of power and depth, and this year, we delivered robust
enhancements to further empower customers on the go. Some
of the more noteworthy features added this year include:
conditional orders; multi-leg options capability; a bespoke
mutual fund trading experience on mobile; and several new
technologies available on Apple products, including home
screen support on iOS, Apple Pay, and our Apple Watch
app, where we are the only broker among our peers to offer
account-level data.
FINANCIAL AND BROKERAGE PERFORMANCE
Our adjusted net income of $344 million, or $1.17 per
share, was aided by the growth and health of our brokerage
franchise, the continued runoff of legacy-related risks, and the
accretive deployment of capital.
While customer activity slowed during the year with daily
average revenue trades (DARTs) declining 8 percent to
155,000, our customers showed confidence when they acted.
They were net buyers of $6.8 billion of securities during the
year and maintained relatively healthy margin balances
throughout, ending the year at $7.4 billion. Meanwhile, our
core franchise also continued its steady growth despite
macroeconomic uncertainty, adding 96,000 net new
brokerage accounts after adjusting for unique items. Our
adjusted attrition rate remained healthy at 8.9 percent.
We brought in $9.3 billion of net new brokerage assets,
approximately one-third of which were into retirement
accounts — a positive measure as we continue to focus on
securing our customers’ retirement, investing, and savings
dollars. Both our challenge, and our opportunity, is to better
engage our customers and broaden their awareness of
E*TRADE as an investment solutions provider for both near-
and long-term goals. We ended the year with $48 billion in
retirement assets in 880,000 retirement accounts.
Another area where we continue to see opportunity is our
stock plan administration business, E*TRADE Corporate
Services. As the industry leader, we are in an enviable position.
The Equity Edge Online platform earned No. 1 in customer
satisfaction and loyalty for the fourth year in a row by Group
Five — the undisputed benchmark for this industry — and
our clients include some of the biggest and most innovative
companies in the world. Our imperative with this business is
to convert participants into brokerage customers, which is
no small task in light of how they typically handle their equity
compensation. We aim to surprise and delight participants,
compelling them to deepen their relationship with us as
brokerage customers. To this end, we continued to invest in
this business during the year, rolling out a faster technology
release cadence, improving our testing capabilities, listening
to our clients more closely, and completing the transition of
clients onto our award-winning Equity Edge Online platform.
We grew the business nicely this year, with the addition of
144,000 net new accounts, to end the year with 1.4 million
plan participants.