Who Founded Interactive Brokers?

The history of Interactive Brokers is the story of modern algorithmic trading. In 1977, Hungarian immigrant Thomas Peterffy bought a seat on the American Stock Exchange (AMEX) for $36,000, trading equity options as an individual market maker. A self-taught programmer, Peterffy recognized that mathematical options pricing models could outperform human floor traders. In 1982, he founded T.P. & Co., which became Timber Hill Inc. in 1984. Timber Hill pioneered the world's first handheld trading computers on exchange floors in 1983, allowing floor traders to calculate real-time theoretical option values and execute complex arbitrage strategies before human traders could recalculate spreads. By 1987, Timber Hill had built the first fully automated algorithmic trading system that routed computerized bids directly to NASDAQ terminals. In 1993, Peterffy created Interactive Brokers Inc. as a direct-access electronic broker-dealer to allow customers to trade through Timber Hill's global clearing network. Over the next three decades, Peterffy phased out market-making operations (divesting Timber Hill in 2017) to concentrate 100% of the firm's balance sheet on client brokerage. Interactive Brokers completed its NASDAQ initial public offering in May 2007 (NASDAQ: IBKR) and has since expanded its global electronic footprint across North America, Europe, Asia-Pacific, and Latin America.