Market makers are paying more than $4.9 bn a year for US equity and options order flow as retail participation cushions markets from tariff turmoil, according to regulatory filings compiled by S3.
As Douglas C. Cifu, chief executive officer, said it during Virtu’s latest earnings’ call on 23 April, “Market Making had its best quarter since the first quarter of 2021”.
So did related payment for order flows. A detailed aggregation of every broker’s Rule 606 filing indicates that market-making firms paid a combined US $1.19 billion for US retail flow in the first quarter, the largest three-month total since public reporting began. The sum was twelve per cent higher than the previous record set in the final quarter of 2024 and fifty-four per cent above the year-earlier quarter. Almost two-thirds of that cash went to option contracts, a tilt that has intensified each year since 2021, while the remainder was directed to equities.
Notes for visualisation tool use: Readers can toggle between market makers who pay for flow and see aggregate payments per security type and order types, the mirroring visualisation is available to look at payment recipients.
Citadel Securities again dominated, laying out US $388 million in the quarter. That figure was 45% above the same period a year earlier and 4% above its spend in the closing quarter of 2024. IMC’s Dash venture followed with US $227 million, up 84% year on year; Wolverine Execution Services, Susquehanna and Virtu Americas rounded out the top five on US $109 million, US $101 million and US $75 million respectively. Together those five market makers accounted for 87% of total payments within our reporting universe. The skew towards derivatives was stark: IMC and Wolverine channelled one hundred per cent of their outlay to options, Susquehanna 75% and Citadel 71%, whereas Virtu paid solely for equities.
A source close to Citadel Securities told Global Trading that the firm’s leading position results from its large wholesale market presence and price improvement capability.
Read more: Citadel Securities paid US$943m for retail US equity, options order flow in nine months
Across our entire sample, the distribution by order-type shows why limit instructions are so valuable to wholesalers. Pure market orders attracted US $212 million of payments, equivalent to an average 0.19 cent per share. Marketable-limit orders drew US $370 million at 0.67 cent per share, and fully passive, non-marketable limit orders commanded US $448 million at 1.70 cent per share. “Other” orders, not held and conditional instructions, made up the remaining US $155 million and were paid at roughly 0.38 cent per share. Citadel’s own pattern closely mirrored the industry’s ladder, whereas IMC’s equivalents converted to more than thirty-eight cent per share for marketable flow and just over 0.50 cents for passive orders.
On the receiving side, retail brokers logged commensurate gains. Robinhood’s two broker-dealer entities together booked US $560 million, 65% than in the first quarter of 2024 and 4% up quarter on quarter. Charles Schwab, now reporting on a fully integrated Ameritrade platform, received US $355 million, lifting its tally by twenty-four per cent year on year. Morgan Stanley’s E*Trade franchise, Fidelity and Webull collected US $93 million, US $72 million and US $57 million respectively; Webull’s total almost doubled against a year earlier.
Robinhood remains the most derivatives-heavy recipient: 80% of its payment receipts came from options and its weighted (weighted on a factored across market makers sample) average PFOF came to 0.65 cent per share, the highest in the top tier.
During the company’s quarterly call chief financial officer Jason Warnick told analysts, “We saw record options volume in the quarter, driven by strong customer engagement.”
The monthly rhythm of payments underlines how quickly retail participation has strengthened since the new administration arrived in office.
January’s aggregate reached US $410 million, February posted US $395 million and March US $380 million – each comfortably above the strongest month of 2024. From a comparative base in the first quarter of 2022, option-linked payments have trebled, whereas cash linked to equities has grown by less than half, reinforcing the view that retail trading is concentrating in short-dated, high-gamma contracts.
All listed market makers declined to comment. Fidelity and Robinhood confirmed our figures.
Methodology: All amounts are taken directly from S3 database which amongst other offerings compile 606 and 605 public disclosures.
Order-type averages are calculated by dividing each firm’s disclosure of dollars paid by its disclosure of equivalent shares or contracts for the same order category.
Rule 606 filings include rebates from exchanges in addition to payment for order flow from market makers. For example, for Interactive brokers 30% of their equities’ receipts in Q1 2025 came from the exchanges rebates and 100% of their options receipts (US$ 12.6million) came from exchange rebates.
