Interactive Brokers Group, the deep discount brokerage with a reputation for catering to active traders, is quietly building up a significant RIA custody business.

Since rolling out its custody service a decade ago, Interactive now serves 3,550 “professional” advisors, said Steve Sanders, executive vice president of product development and marketing. Professionals include both investment advisors and commodity trading advisors, who together handle about $14.5 billion in client assets.

The firm also clears for 183 broker-dealers in which the relationship with Interactive is disclosed to the clients (those relationships total $7.4 billion in assets), and another 157 B-Ds in which the relationships are not disclosed and the B-D acts as a white label firm for the service (those relationships total $6.1 billion).

The company’s professional assets under management are up 41 percent year over year for the year ended February, while fully disclosed brokerage assets are up 56 percent and non-disclosed balances are up 148 percent, according to Sanders.

Those growth rates on the custody and clearing side beat the firm’s still-respectable 38 percent growth in its individual investors business.

The RIA growth comes from U.S. advisors, and the broker-dealer expansion is coming from overseas, Sanders says, where local firms don’t have a lot of alternatives other than Interactive’s global platform that offers access to 120 different markets.

Interactive heavily promotes its universal global account, in which investors and advisors can trade multiple vehicles in multiple currencies from a single account.

And of course, there are the super-cheap transaction fees that have always attracted clients. The firm charges about one dollar for the average retail stock or option trade, which scales up slightly for larger orders, so the average cost per trade among the firm’s clients (both retail and institutional) comes to $2.36, Sanders says.

In addition to the cheap trades, Interactive touts its automated “smart” order-routing system for best execution, and it says its margin financing rates are significantly cheaper than those of competitors.

For advisors, the Interactive platform has historically appealed to those who run actively managed tactical portfolios and options strategies. But over the past few years, the firm has added more buy-and-hold advisor clients, especially from overseas, Sanders says.

Less active accounts can benefit from Interactive’s unique stock-yield enhancement program, which allows clients to share in rebates of stock-lending fees, Sanders says.

It is those types of competitive enhancements that make Interactive a legitimate alternative to the bigger RIA custodians, said Michael Freeburg, founder of Greenwich Wealth Management in Greenwich, Conn., who has used Interactive for about as long as the company has been in the custody business.

“Ten years ago, I’d say Interactive Brokers was not a fully integrated enough shop” to support advisors, said Freeburg, who splits his nearly $1 billion in assets between Interactive, Fidelity and Schwab. “They were more of a clearing firm for professional traders. … But over the last 10 years, they have really ramped it up and spent a lot of time and energy into making everything an advisor would need,” namely, by adding better reporting and account-management capabilities suitable for retail clients.

Freeburg figures that with actively managed accounts, advisors could save 30 to 50 basis points a year in trading costs at Interactive, and he says he can add another 30 to 35 basis points from stock-lending fees.

One thing Interactive lacks is banking capabilities, Freeburg adds. “So if a client has a need to do check writing through their account, [the firm] would not be a good solution at this point.”

Last November, Interactive rolled out a compliance consulting unit for advisors, Greenwich Advisor Compliance Services, to help new advisory firms get launched.

Sanders says the firm sees potential in the more than 11,000 yet unregistered “friends and family” advisors it supports. As these small investors-turning-advisors grow and have to get registered, the compliance unit for a “nominal fee” will handle the registration paperwork while the firm sets them up with a website and a CRM system, he says.

Advisors using Interactive now have a robo platform, Covestor, which was acquired in 2015 and offers actively managed portfolios at low fees. Additionally, Interactive Brokers offers an Investors Marketplace and a Hedge Fund Marketplace, where investors and advisors can find third-party money managers and CTAs.

Freeburg has gotten a few clients by listing on the marketplace, and has used both the robo and hedge fund market for his clients.

Interactive “makes sure the barriers [to entry and exit] are very attractive,” he said of the hedge fund market, “and that everyone has to play well together.”