The 1 Stock I'd Buy Before Interactive Brokers Group Right Now
Key Points
Robinhood doubled its revenue amid new product offerings, strong demand for existing options, and more customers joining the platform.
This winning combination is supported by soaring profit margins, demonstrating sustainable growth.
Prediction markets are a hot segment for Robinhood that can become a sizable part of the business in a few years.
- 10 stocks we like better than Robinhood Markets ›
Global electronic brokerage firm Interactive Brokers (NASDAQ: IBKR) had a solid 2025 with its stock soaring over 45%. By executing, clearing, and settling trades across diverse global asset classes, investors get the ability to trade in stocks, options, and cryptocurrencies with just an Interactive Brokers brokerage account. In addition, Interactive is known for offering relatively low interest rates on margin loans (money investors borrow to trade).
All of these catalysts have ensured a smooth sailing into 2026 as well, with the fintech stock already up an impressive 15% year-to-date. However, there may be a better option: a faster-growing competitor in the middle of a market correction, Robinhood Markets (NASDAQ: HOOD).
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Robinhood's strong financial growth sets the foundation for more gains
Robinhood is growing faster than Interactive Brokers while boosting profit margins. That's the winning combination for any growth stock, especially for a fintech company like Robinhood, which doubled revenue in the third quarter of 2025.
Image source: Getty Images.
Every part of the business has been booming. Transaction-based revenue, including stocks, options, and crypto, jumped 129% year over year. Net interest revenue increased by 66% year over year as more Robinhood customers tapped into margin to boost their portfolios. The fintech also has an "Other revenues" segment, which more than doubled year over year, largely due to Robinhood Gold.
The success of these products shows that Robinhood continues to innovate beyond leading the way toward commission-free stock trades more than a decade ago. This growth also came with a 271% year-over-year increase in overall profits, indicating it is sustainable.
A growing customer base and higher ARPUs point to more gains
Robinhood doesn't just have high growth rates from existing customers spending more, but it also continues to bring in new users. Roughly 2.5 million people joined Robinhood in Q3, bringing the total number of funded customers to 26.8 million.
That growth coincided with the average revenue per user increasing by 82% year over year. Increased trading activity played a role, but Robinhood has also successfully expanded its prediction market segment, which is delivering substantial sequential growth.
Prediction markets can bring more people to the Robinhood platform and introduce them to stocks, options, and crypto. Robinhood customers who have already used the app will have another market to allocate some of their cash.
If Robinhood continues to win more customers while boosting the average value of each customer, the growth stock has two large tailwinds that can support further gains. Overall optimism in the stock market, a likelihood in 2026, incentivizes people to invest more. By enabling seamless trading in fractional shares, Robinhood incentivizes investors to use its platform over competitors'.
Second, a rising market also incentivizes investors to borrow more against their assets and become more active in financial markets -- again, a win for Robinhood.
Should you buy stock in Robinhood Markets right now?
Before you buy stock in Robinhood Markets, consider this:
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Marc Guberti has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Interactive Brokers Group. The Motley Fool recommends the following options: long January 2027 $43.75 calls on Interactive Brokers Group and short January 2027 $46.25 calls on Interactive Brokers Group. The Motley Fool has a disclosure policy.
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