Set to join the S&P 500 on Thursday, IBKR sure looks like a winner

Interactive Brokers (IBKR) is set to join the S&P 500 on Thursday, and the coming institutional support provided by being added to the premier index bodes well for IBKR bulls. Shares of the digital brokerage and financial asset custodian have outperformed the major indices on Tuesday, rising above $63.

The broader market is slightly in the green, although the major indices have been mixed for most of the session. The market is somewhat timid after US President Donald Trump attempted to fire Federal Reserve (Fed) Governor Lisa Cook for cause, alleging that Cook engaged in mortgage fraud. Cook, in turn, hired high-profile lawyer Abbe Lowell and refused to resign, saying that she will continue her duties at the central bank.

The market views the event as Trump messing with Fed independence in order to force interest rate cuts, a belief that has pushed 30-year Treasury yields higher. This is particularly the case after Trump was reported to have implied as much:

@Deltaone post on X.com / August 26, 2025

US stocks have been largely muted on Tuesday as most traders appear to be waiting for Nvidia's (NVDA) Q2 earnings to be released after market close on Wednesday. Another slump in monthly Durable Goods Orders, this time for July, failed to move share prices during the morning session.

Interactive Brokers stock news

With a market cap of $106.68 billion at the time of writing, inclusion in the S&P 500 will make Interactive Brokers about the 100th largest holding in the index. The company will be situated somewhere between defense stalwart Lockheed Martin (LMT) and Chubb Limited (CB).

Interactive Brokers stock has risen more than 100% over the past year as revenues and earnings per share (EPS) continue to climb at a low double-digit rate. IBKR will take the place of Walgreens Boots Alliance (WBA), which is being taken private by private equity shop Sycamore Partners.

IBKR had already been included in the S&P MidCap 400, where it is being replaced by Talen Energy (TLN), but the S&P 500 inclusion will mean much heavier institutional holding of IBKR, as the market for the 500 largest US stocks has a much heavier investor following.

The largest S&P 500 ETF, the SPDR S&P 500 ETF (SPY), has $651 billion in assets. The largest S&P 400 ETF, the iShares Core S&P Mid-Cap ETF (IJH), has about $100 billion in assets.

Founder Thomas Peterffy still controls about 75% of the company through ownership of IBG Holdings, which is why the company already has institutional ownership nearing 87%.

Interactive Brokers stock chart

Interactive Brokers stock has been leading the 50-day, 100-day and 200-day Simple Moving Averages (SMAs) since mid-May. It is clearly in an uptrend and hit an all-time high on August 12 at $68.07.

Shareholders will expect IBKR to make new highs after entering the S&P 500 on Thursday. And its current short-term support near $60 from the 50-day SMA should continue to rise. After effecting a 4-for-1 split in June, the share price is also retail-friendly and is likely to garner more eyeballs from laptop traders, many of whom presumably trade on the Interactive Brokers platform and are probably familiar with the name.

With a Relative Strength Index (RSI) score of 52, shares are far from overbought, and a move toward the $70s would seem likely after more than a week of basing in the low $60s. The only thing that can stop IBKR's rally this fall are changes in the macro picture. With the market trading near all-time highs, only a broad sell-off will get in IBKR's way.

IBKR daily stock chart