Good day, everyone, and welcome to the TD Ameritrade Holding Corporation's September Quarter Earnings Results Conference Call. This call is being recorded. With us today from the company is President and Chief Executive Officer, Fred Tomczyk; and Chief Financial Officer, Bill Gerber. At this time, I'd like to turn the call over to Bill Murray, Managing Director of Investor Relations. Please go ahead, sir.

Thank you, operator, and good morning, everyone, and welcome to our September earnings call. On this call, we will be covering the September quarter and full year 2013 results, as well as our guidance for 2014. Please refer to our press release and September quarter earnings presentation, which can be found on amtd.com. Our Safe Harbor statement and reconciliation of certain non-GAAP financial measures to the most comparable GAAP financial measures are included in the slide presentation, and descriptions of risk factors are included in our most recent financial reports Forms 10-Q and 10-K. As usual, this call is intended for investors and analysts and may not be reproduced in the media, in whole or in part, without prior consent of TD Ameritrade. [Operator Instructions] With that, we have Fred and Bill here to review the September quarter and full year results. Fred? Fredric J. Tomczyk: Thank you, Bill, and good morning, everyone, and thanks for joining us today to discuss our September quarter and 2013 fiscal year-end results. 2013 was another strong year for TD Ameritrade. Once again, we delivered a strong performance in the face of an ongoing difficult environment. Uncertainty still exists, primarily due to ongoing political gridlock, which, while good for trading, has kept the average retail investor largely on the sidelines. And yet, our growth continues, giving us good momentum as we start 2014. Let's take a look at how we ended the year with the fourth quarter's key highlights on Slide 3. Average client trades per day were 382,000, an activity rate of 6.4%. Net new client assets of $10 billion, an 8% annualized growth rate. Record total client assets of $556 billion were up 18% year-over-year. The record interest sensitive assets of $96 billion were up 16% year-over-year and net revenues of $709 million, up 10% year-over-year. And diluted earnings per share were $0.36, up 38% year-over-year, inclusive of the $0.06 gain from our investment in Knight Capital Group that we told you about last quarter. Let's now turn to Slide 4 for a look at what those results meant for our fiscal year. Once again, we delivered another strong organic growth year. Trades per day were 374,000, an activity rate of 6.3%. And 2013 was our fifth consecutive year of double-digit asset gathering, with net record net new client assets of $50 billion, a 10% annualized growth rate. Total client assets ended the year at $556 billion, up 18% year-over-year. And we ended the year with record interest sensitive assets of $96 billion, up 16% over 2012. Each of these contributed to the highest net revenues we earned in our history of $2.8 billion, an increase of 5% year-over-year. And operating expenses were, again, flat year-over-year, something that we're quite proud of. We have now held expenses at the same level in each of the last 3 years, while continuing to invest in the business and deliver record organic growth. This leaves us with diluted earnings per share of $1.22, up 15% year-over-year. And last but not least, we returned 107% of our earnings to our shareholders via cash dividends and debt repayments. In fact, for shareholders who held our stock since the end of last fiscal year, the effective dividend yield on that investment was 5.6%. And when you combine that 5.6% with our 70% stock appreciation over the fiscal year, our total shareholder return into fiscal 2013 was over 75%. We also received another credit rating upgrade when Moody's moved us up to A3. All in all, it was a good year, a strong year, and we're pleased with the results. Let's look at the key components of our growth strategy in more detail starting with asset gathering on Slide 5. For 5 years, we have grown net new client assets at double-digit rates, accumulating nearly $200 billion. In 2013, we gathered a record $50 billion, a 10% annual growth rate. In our retail channel, growth was driven by our sales and service efforts to create new client relationships and deepen existing client relationships. Cross-selling is going well, and our asset retention rates were the best we've ever seen. And we completed a major overhaul of our branch technology in the year, helping our branch investment consultants be more productive as we eliminated inefficiencies and improved our sales processes. In the institutional channel, growth was driven by new -- by both new and existing RIAs. We continued in our effort to deliver new technology solutions for advisors, and we launched a new marketing campaign to attract new RIAs to our platform. We added 389 breakaway brokers in the year, or 1.5 new brokers each and every business day, on average. And our sales pipeline remains robust. As we look ahead to 2014, our focus will be to maintain this momentum. We remain committed to our long-term goal of 7% to 11% in annualized growth. Now let's look at our results from trading on Slide 6. We finished the year with an activity rate of 6.3%, well within our forecasted range. It was a record year for derivatives, which were 39% of our daily average revenue trades. And we remain the industry leader in this space. We also had a record year for mobile, with 9% of our DARTs for the year coming from mobile devices. We continue to extend our leadership position, not just in terms of market share, but in technology and thought leadership as well. Third parties like Barron's, Investor's Business Daily and Stockbrokers.com, have praised us for our offers. We've been named the best for options platform, best desktop platform, best for customer service, best for new investors, best for education and best for mobile platforms. We have one of the largest bases of retail traders in the industry. And this year, we aggregated their activity for the first time to produce the Investor Movement Index, which gives us greater clarity and insight into retail investors' actual behavior, not just their stated behavior. As we look ahead to 2014, it's all about continuing to build on our leadership position. Our trading group will continue to push the envelope. Our activity rate forecast for the year is, again, 6% to 7%. And as you know, it's difficult to predict what will happen in the world over the next 12 months and how those events might affect the markets. We've already seen increased volatility in the market with the talk of Federal Reserve tapering, the government shutdown and yet another debt ceiling debate. As you are aware, volatility stimulates trading amongst our active traders, and we've seen that more recently. Trades per day, October month-to-date, are 419,000. We would expect further short-term volatility as we ready ourselves for another budget and debt ceiling debate this winter and the continued uncertainty around Fed tapering. Let's now turn to investment product fees on Slide 7. During 2013, we talked at length about the contributions that fee-based products, like Amerivest and AdvisorDirect, make to our business previously under the topic of market fee-based revenue. To make things easier, we will reference these results under the heading of Investment Product Fees going forward, which correlates directly with our income statement and includes everything included in market fee-based revenue, plus money market mutual fund revenue. Over the last 4 years was, growth in this area has been exceptional. For 2013, balances were up 31% year-over-year, and fees were up 28%. Sales in Amerivest and AdvisorDirect continue to perform well, and mutual fund growth remains strong. As we look to 2014, our objective is to grow this revenue stream by 15% to 25%. Now let's take a closer look at 2014, starting with some of our key strategic initiatives on Slide 8. Macroeconomic conditions continue to improve throughout 2013, indicating promise for the year ahead. The yield curve, in particular, started to steepen on news of potential Fed tapering. However, the gridlock in Washington has caused the yield curve to flatten more recently, and economists now believe that any taper is unlikely until next spring. This practice of managing from crisis to crisis is creating uncertainty and holding back the economy. But that doesn't change our plans. We'll continue to focus on what we can control and find ways to drive organic growth. We plan to once again deliver strong growth in asset gathering. In our retail channel, we'll continue to evolve and enhance our sales processes to generate greater efficiencies and throughput. We'll focus on our new account funnel, optimizing every step from marketing to on-boarding to funding. And we'll look closely at our product offering and identify new ways to attract clients, accounts and assets. In our institutional channel, we continue to see existing RIAs grow their business as more investors choose to work with an advisor that sits in the same side of the table as them. We will continue to help RIAs capitalize on this trend by providing leading practice management programs and leading technology integrations. The breakaway broker trend always -- also continues, and we continue to capitalize on that opportunity, as we have for the last several years. Next, we'll maintain our leadership in trading. We remain focused on the growth part of the trading business, namely options and futures. We'll continue to innovate, updating our platforms, creating new tools and maintaining our competitive edge. We'll also focus on the next generation of retail investors. We are leveraging platforms that young investors already embrace, like mobile and social media, to build new relationships, to educate and to build brand affinity. We'll continue to develop the revenue we earn from investment product fees. Sales of Amerivest and AdvisorDirect will remain a priority. We are predicting a modest increase in expenses in 2014, as we build out our capabilities to support initiatives targeting our future growth. Ongoing efforts in lean and sourcing will help us keep our costs in check. And we'll continue to be good stewards of our shareholders' capital by either using -- shareholders' capital or returning it to our shareholders. We will increase our quarterly dividend by 33% to $0.12 per share, the third year in a row that we've increased our quarterly dividend in the midst of a challenging environment. And once again, for the second year in a row, we are declaring a special dividend of $0.50 per share to be payable in December. Based on our current stock price, that's an effective dividend yield of 3.5%. We expect these combined efforts to contribute to our fiscal 2014 earnings per share range of $1.20 to $1.40. In closing, 2013 was a strong year for us. We have once again shown that we can keep expenses in check, invest in the business and grow. With the fifth consecutive year of double-digit net new client asset growth under our belts, the challenge is to keep this performance up going forward. And as always, we'll remain focused on growth and building our long-term earnings power, while positioning ourselves for the day when interest rates begin to increase. As you are well aware, we have significant upside in a rising rate environment. The management team remains very focused on continuing to execute our strategy and deliver on our 2014 objectives. And with that, I'll turn the call over to Bill. William J. Gerber: Thank you, Fred, and good morning, everyone. Well, another year is in the books, and we, again, are happy with the results. When we started this year, we were battling market uncertainty and the continued interest rate headwinds. However, through strategic initiatives, double-digit asset growth and tight expense discipline, we were able to deliver results that were slightly ahead of our guidance range we provided to you a year ago and at the high end of the range, excluding investment gains. Once again, we've shown that we can invest in the business and deliver record growth while keeping expenses in check. For a closer look at our results, let's begin with the financial overview on Slide 9. We'll start with September to September on the left side of the page. Note that there was 1 more trading day this quarter. As I've said many times, in the current rate environment, the variability of our results in any given period is going to be primarily driven by trading activity. This quarter was no different, as the increase in earnings was directly related to higher trading. On Line 1, transaction-based revenue is up $50 million, driven by 53,000 more trades per day, an increase of 16%, as well as an increase in the commission rate of approximately $0.15 per trade. The rate increase was driven by continued strong payment for order flow. As a result, net revenues, on Line 4, were up 10%. On Line 5, operating expenses, excluding advertising, were up $18 million or 5% to $375 million, primarily due to trade volume and mix drove higher clearing and execution expense and planned technology and facilities spend. As you recall last quarter, I guided to a $380 million run rate for a couple of quarters, as we pressed forward on some planned investments. On Line 9, this is where the impact of the Knight gain was booked, and thus provided a nice lift to earnings. Of note, the net gain from Knight was $49 million, consisting of a $54 million gain from the merger of GETCO, offset by realized losses on the shares we received as a result of the merger. On Lines 12 and 13, net income came in at $200 million for the quarter, which translated to $0.36 per share. Lastly, on Lines 14 and 16, we continued to demonstrate strong cash generation as we earned $0.39 of EPS, excluding amortization and intangibles, and the EBITDA-to-net revenue ratio was 53%. Moving to the full year comparison on the right side of the page. On Line 4, we had record net revenues of almost $2.8 billion, up $123 million from last year. This growth was driven by strong asset gathering, higher commission rates and strong asset-based balanced growth, particularly in fee-based balances, offset by lower education revenue, as expected. On Line 7, once again, we held expenses flat year-over-year, demonstrating continued expense discipline. On Line 13, the net result was an increase in EPS of 15% or $0.16 per share. Lastly, Lines 15 and 16 once again show our very strong cash generation, earning $1.3 billion EBITDA or 47% of net revenue. Now let's turn to spread-based revenue on Slide 10. Spread-based revenue continues to remain remarkably resilient despite the continued rate compression. As you can see from the top chart, we have grown revenue by $169 million from fiscal year '10 to fiscal year '13, even though the net interest margin has declined more than 50 basis points in that time. On a year-over-year basis, revenue is flat, as balances grew $10 billion or 14%, but were offset by 19 basis points of rate compression. However, we believe that net interest margin will stabilize or increase from the September quarter 2013 actuals during fiscal '14. We also expect overall spread-based balances to continue to grow, which will be the primary driver of expected revenue growth. Margin balances averaged $8.6 billion in fiscal '13, but ended the year at $8.9 billion and have since surpassed $9 billion in October. This gives us some additional optimism. Now let's discuss the IDA on the next slide. Despite low interest rates and a volatile yield curve, strong balance growth and a disciplined extension strategy has allowed us to grow revenue by a 6% compounded annual growth rate since fiscal '10. These are strong results when faced with yields dropping 55 basis points over this time. As you can see on the top chart, IDA did take a small step backward in fiscal 2013. However, we are hopeful that the worst is behind us. The average duration of the IDA portfolio is 2.8 years, still within our targeted 2- to 3-year range. In fiscal '14, we expect stable net yields or even net yield expansion from September quarter 2013 actuals, as we plan to continue to benefit from yield curve increases. Said another way, we believe that we have hit our low point on net yield in the last quarter based upon current and projected interest rates. Further, we do not expect -- we do expect balances to grow 12% to 15% next year. The net result as we expect IDA income to increase next year, even at the low end of our guidance range. Finally, the overall expansion strategy is unchanged. Now let's turn to Slide 12 to discuss the interest rate-sensitive assets. Interest rate-sensitive asset balances are up $13 billion or 16% from last year and are now approaching $100 billion. Of note, IDA balances are up 16% year-over-year, ending the quarter at $73 billion. Client cash as a percentage of total client assets was 16.5% at the end of September, slightly down from June due to RIA activity, but still within our historical range of 15% to 20%. There are also a few slight changes to this slide. We are introducing a new consolidated duration that provides a more complete picture of our aggregate interest rate sensitivity. It is currently 2.3 years, factoring in the duration of the IDA portfolio, plus the overnight money on our broker-dealer balance sheet. The targeted consolidated duration is 1.75 years to 2.75 years. We have also provided the split-out of float versus fixed IDA balances so that you can more easily identify rate-sensitive balances impacted by short-term rates versus balances impacted by long-term rates. Finally, as we normally do this time of year, our sensitivity has been updated to reflect current balances of our portfolio from all of the growth realized, particularly in balances benefiting from short-term rates. As a reminder, we only update the sensitivity on an annual basis. Now let's take a look at some key information regarding our guidance on the next slide. Here's a summary of some of the key information for our outlook statement. Please refer to the detailed outlook statement available on amtd.com. Much of this is similar to what we have shown in the past and has already been addressed this morning. Our EPS range for fiscal '14 is $1.20 to $1.40, and our pretax margin range is 38% to 40%, still industry-leading. Although not noted on this slide, expense discipline will remain a key driver of maintaining these strong pretax margins. We are guiding you to a range of $1.48 billion to $1.6 billion of operating expense, excluding advertising. The variability of the results is once again going to be primarily a function of trading levels. Our guidance assumes a 6% to 7% activity rate versus the 6.3% achieved this year. We believe we are through rate compression as compared to the September quarter, forecasting NIM and IDA ranges of 1.40% to 1.50% and 1.08% to 1.18%, respectively. Now let's move on to the last slide. While the market uncertainty has not completely subsided, we did see the market stabilize a bit and expect an improved macroeconomic environment during fiscal '14. However, regardless of the environment, we remain focused on retaining our #1 position in both trading and growing assets in an industry-leading rate. Our net new asset growth rate range is, once again, 7% to 11%. Our investment product fees took big steps in fiscal '13, and we want to further develop this third revenue stream. Expense discipline and process improvement will remain an area of focus as we continue to invest in the future. We will continue executing on our capital strategy by increasing our quarterly cash dividend by 33% to $0.12 per share and declaring a special cash dividend of $0.50 per share. We're very proud of our fiscal '13 results and are encouraged by the positive trends we are seeing in the economy and in the markets broadly. We are confident that we will build on that momentum as we move into fiscal '14. And with that, I'll open up the call for questions.

[Operator Instructions] And the first question is from Rich Repetto of Sandler O'Neill. Richard H. Repetto: So I guess, the first question, Bill, is on the spread. And you've seen contraction on the spread just quarter-over-quarter, both on IDA and NIM. I was just wondering, I thought from the last time that reinvestment rates were roughly equal to roll-off rates. So that's why we haven't factored in any more contraction. And could you just give us some color on what happened in the spread quarter-to-quarter? William J. Gerber: Yes, actually, float increased a bit, Rich, and that's what -- there was a primary impact on that. So I guess that's really the short answer, is the float increased quarter-over-quarter. Richard H. Repetto: So reinvestment rates are still equal to or possibly greater than roll-off rates? William J. Gerber: Yes. Richard H. Repetto: Okay. Next question, Fred and Bill. I guess, on the expense guidance, you talked about 3 years being flat. But this year -- or the full year outlook looks like almost a 5% increase at the midpoint and $80 million to $85 million-or-so increase from fiscal year '13. Could you just talk about whether I got the number right? And where is the incremental spend going to go? William J. Gerber: Yes, it's mostly going into -- yes, I agree with your assessment. It's mostly going into technology spend, which is the plan is that we'll provide efficiencies. So we'll be able to, hopefully, take some of that expense out. As you recall, last quarter I said, over the next few quarters, we're going to be hitting about $380 million. And so -- but we are expecting that to be under right now. Richard H. Repetto: I just didn't catch the end, sorry. William J. Gerber: No, I mean, we are expecting expenses to go up in fiscal '14. And then we'll see, based on the efficiencies, what we are able to take out of that for fiscal '15. Richard H. Repetto: Okay. And just one cleanup question. You didn't report, at least we can't find it, the growth accounts. You still report the funded accounts, but we can't see attrition or anything. Is there a reason why you changed the reporting? William J. Gerber: We just haven't found that to be as meaningful. And I'm sure we can get it to you, but we haven't found that as meaningful as funded accounts. So we'd opted to change that in the mixture [ph].

The next question is from Mike Carrier from Bank of America Merrill Lynch.

Maybe just a question on the cash use and just priorities when we look ahead. You guys have done 2 specials on the increase of the dividend. When you look at maybe the product suite, what you have, what the clients are demanding, anything on the M&A front or the investment front that we should see a pickup? And then maybe, just longer term, how do you think about buybacks versus increasing the dividend or additional specials? Fredric J. Tomczyk: We're always looking at areas to grow and keeping up the growth rate we've been having and developing a third revenue stream. I mean, it takes a lot of work and it does take investments. We've been able to fund most of those investments through our lean initiatives over the last couple of years. We've continually looked across the horizon and in the industry in terms of adjacent businesses that we might be able to acquire set of capabilities or a product set that we felt acquiring would help us. But we haven't found anything at this point that we find attractive, that we wouldn't rather build. So we've opted to build, for the most part, over the last while, and probably we'll continue to do that for the future. As we look forward, we've always said we have 5 potential uses of our capital. One is to invest in growth, in neutral acquisition or organic growth. We continue to do that. In the last couple of years has been primarily investing internally in organic growth. But the last one we did that was really an adjacency or a business we were in, but really gave us some new capabilities was thinkorswim, which worked out really well. If we could find another one like that, we'd be very happy. But on the trading side, I think we have a pretty complete suite, so it will be more on the asset gathering and investment product side. On the -- and then I think when you go through the list, you've got buybacks, recurring dividends, debt repay down and special dividends. On the debt repay down, we now have our debt right where we want it. We've got our credit ratings right where we want them. We've got our liquid assets right where we want them. So we really don't see a need to pay down debt. And we don't see the need to build our capital right now because we don't see anything of any significance on the near-term horizon. So you want to get back in dividends and share buybacks and, basically, where we are to date, we would have a slight bias to dividends. And you've seen that in the numbers today.

Okay. And just as a follow-up. On the fee-based products, and this might be the consolidation of the money markets and the other fee-based products, but I just wanted to -- just a question on the fee rates. Because it looks like it might have gone from like 23% to 22%. And more importantly, just the outlook. Is there -- from a mix standpoint, would we expect that, over time, to see some pickup there? And then also, just from distribution in terms of pricing power, is there anything that you guys can do that we could see that fee rate pick up over time? Fredric J. Tomczyk: Well, first one, the change over the quarter is definitely in money market fund revenue, which is only earning next to nothing. So that's definitely what the 23% to 22% is. We continue to make sure we're getting the optimal amount or maximum amount of 12b-1s. And we continue to work at our Amerivest program, and we did increase the fees going forward for new sales a year ago. So we continue to look at that. But to be quite honest, we don't see a lot of room from where we are. But we will continue to make sure we're getting the maximum amount of 12b-1s where we certainly do those. And when you get a bigger scale, you have more power on that.

The next question is from Patrick O'Shaughnessy of Raymond James. Patrick J. O'Shaughnessy: So my first question is on your IDA portfolio and balances. Are you comfortable with the current mix of floating versus fixed? Or do you see that moving a little bit more towards floating as 2014 progresses? Fredric J. Tomczyk: We follow a pretty sophisticated ALM techniques. And when you look at our consolidated duration versus the IDA duration, it's deliberately -- we're longer in the IDA than we are overall. I would say based on where we are right now in the outlook for rates, I'd say we are fairly comfortable with where we are. But we will continue to tack on opportunity as we see fit over time. And I think we've been pretty transparent and we pointed that out to you after we've done -- we're not going to sort of play our hand beforehand, based on today's world. Patrick J. O'Shaughnessy: All right, I appreciate that. And then my follow-up. Your guidance for other revenue, the range of $50 million to $60 million, that's down from about $70 million in fiscal 2013. Is there something going on there? Are you guys basically lowering your expectations for the education business? Or is that just kind of building in a fair amount of conservatism into your guidance? Fredric J. Tomczyk: We've been -- we've changed our strategy on the investment education business a couple of years ago. And if you recall back then, you had a revenue stream that was deferred, and it runs down over time. So that's really what you're seeing. We moved away from a heavy focus on the investment education business as a fee revenue business and turned it much to be more focused on our clients, both new and existing, in terms of educating them to be better investors and better traders.

The next question is from Howard Chen of Crédit Suisse.

I was hoping to follow up on the spread outlook. Bill, am I hearing you correctly that the outlook -- that spread inflects upward just based upon reinvestment yields increasing in line with the forward curve and no material changes in business mix, duration, flow percentage from here? William J. Gerber: Yes, that's exactly right.

Okay. And then, Fred, you've discussed more actively and aggressively shortening duration and awaiting a rising rate scenario. Now what would you need to see to sort of arrest that scenario in thought? Fredric J. Tomczyk: Well, where we are right now is -- we're actually fairly happy with where we are from an asset-liability perspective. I think you'd have to -- I think to aggressively shorten it, you'd have to have a view of that within the next 6 to 9 months, that you were starting to feel as though Fed funds was going to rise. We don't see the point of shortening when it's 2 years away.

Okay, that makes sense. And then my second question is on capital return. You're finishing another really strong year for capital return for shareholders, but you didn't specifically mention the 40% to 60% return goal this morning. Is that still the goal for -- heading into fiscal '14? Or should we think about the year's maybe digestion after a couple of years above 100%? Fredric J. Tomczyk: I think we deliberately don't talk to the 40% to 60% anymore because I think where we are has changed. As I said earlier, our credit ratings are where we want, our liquid assets are where we want. So we don't -- unless we have a reason to hold that capital, we would return it. As you're aware, we have pretty strong free cash flow. So 40% to 60% would be low from where management is currently thinking at this point. I think we would be well north of that today, based on today's environment, our outlook for -- on the acquisition side.

Our next question is from Chris Allen of Evercore. Christopher J. Allen: Just looking at the interest-earning asset yield during the quarter, it came in a little bit more than expected even though margin rates seemed to bounce up a little bit. I'm just trying to think about what occurred during the quarter. Was it just higher cash balances? And then your outlook going forward, does it contemplate, basically, some of the competitive pressures in margin outlined and that we've seen in recent quarters abating? And also have to think about sec lending into the next year? William J. Gerber: The first one is, basically, an increase in sec cash, that has really bolstered in the quarter. The second answer is -- your second question is regarding the -- we're expecting flat margin rates. We don't really see much of that changing, going from here. And third, in securities lending. Securities lending is an interesting business, and really, market dictates how much security lending you can do. We obviously have a very large book, so we are sought out quite regularly for securities lending. So I'd guess I'd be optimistic in that area relative to last year only because the book is larger. Christopher J. Allen: Got it. And just one other question, just on the RIA channel and growth there. It sounded like breakaway broker trends have continued at a decent clip. I wonder if you've seen the wire house has taken any steps to address that recently? And how you're thinking about that moving forward? Fredric J. Tomczyk: Yes. I think more recently, the wire houses have made some moves, which have made it a little bit more difficult in the breakaway brokers. But what we always find is, in the market, it could be an independent broker/dealer is 1 year on their wire house. The next year, it could be 1 wire house to 1 independent broker/dealer. There always seems to be someone who's making some changes that upset their advisors. And that always means there's opportunity and people looking. And I do think in this market, with the -- where the markets are at and how well the markets have gotten, this is a good market if you want to move to the independent channel and move to a fee-based model off of the commission-based model. This has actually been a pretty good environment to do that. We've seen that in spades in our results.

Our next question is from Chris Harris of Wells Fargo Securities.

So another year of very strong asset growth. I'm just wondering if you could comment at all about how growth has been for your active trader segment? I'm just wondering if you guys are taking share for that customer group and maybe how the competition has evolved there? Fredric J. Tomczyk: We continue to do very well on the active trader side. We look at it -- the way we look at it, our trading share -- our share of trades per day, versus our public competitors, continues to increase. And we clearly have been very focused on the part of the market that has growth and has interest to get more active traders, which is the options, and increasingly, the futures. So we're up to probably 7%, 8% on the futures side and 30% -- low 30% on the options side. So we continue to do a fair bit of work on complex options and things like that. So we haven't missed a step there. In fact, we continue to do very well there. And we continue to see very good trends on mobile. And we definitely do see, when people have mobile, they do trade more because they have more opportunities to trade.

Okay. And then just a quick follow-up on the guidance. Maybe this is a little bit too specific of a question, but with the interest rate guidance, if we saw the tenure go back down to 2% in a corresponding decline in the swap curve, do you guys still think you could hit the lower end of your guidance for NIM and IDA? William J. Gerber: I think it'd be tougher. But, yes, I think we'd be close. And, obviously, if we're going to be far outside that, we would probably bring it up some time during the year. But it's -- as I said, we'd probably be close. Fredric J. Tomczyk: Yes. The reality is, if you saw that environment, you'd probably extend duration of that, protect it a bit. But the reality is, inside a year, the numbers have gotten so big, and our guidance range is actually 10 basis points. That's a pretty tight range, and it would take a significant movement of the curve in the year -- early in the year, to actually really move us. William J. Gerber: Yes, it's hard to move the ship.

The next question is from William Katz with Citi.

This is actually Neil filling in for Bill. Just one quick follow-up on the trends you're seeing in the breakaway broker pipeline. You already mentioned pretty robust, but maybe you could just touch upon the cost side and so how acquisition costs have had effects. Fredric J. Tomczyk: Well, and it's a very competitive market. We've seen it. There's some things that some of our competitors have done that we refuse to do. I think everybody complains about everybody being aggressive, but I don't think it's changed any in the last 2 or 3 years. I think it's been aggressive for 2 or 3 years, and it's a very attractive part of the market. It's a fast-growing part of the market. And it's a very competitive part of the market. But I don't think there's anything new from 2 or 3 years ago.

And our next question is from Ken Hill of Barclays.

Fred and Bill, I have a quick question here on some of the transaction guidance. So I guess over the past few years, we've seen futures really become a bigger part of DARTs, up to 10% of volumes, seeing options really come on strongly, seeing cash come up sluggish here. How is that really portrayed in the guidance moving forward? How are you guys thinking about the different moving pieces within the trading business? William J. Gerber: We actually keep them relatively flat around -- to the prior year. So we would see -- so foreign exchange, we would put that out, so that, in the mix, is -- are usually 1% or less. So that is a derivative. And then you have the options, probably in the low 30s, as Fred said, and then futures would be 7%, 8%. So we would see probably slight upticks in maybe options and futures. But really flat on foreign exchange, and that's really where it's been for some time.

Okay. Follow-up here is just kind of on some of your net new asset target. I think in the past, you talked about hiring sales people to support some of the organic growth. Just wondering how you're thinking about that next year as well. Is it like you're looking to bring on more sales folk in order to kind of support these goals? Is it more or less kind of around the same run rates going forward? Fredric J. Tomczyk: We will bring on more sales people next year. Roughly, I think, it's 50 we have in our plan. But it will happen over the year as opposed to -- we didn't, this year, sort of rush in, in the summertime, and try to add 50 people to start the new year. We can decide to spread it more evenly over the year because we're noticing that you just get more quality and we have better success rates.

And our next question is from Joel Jeffrey of KBW.

Just a quick question. I apologize if I missed this earlier, but going back to the interest rate sensitivity, it looks like in the first 2 years, you're seeing slightly higher rate sensitivity. But in year 3, it goes down a little bit from what you've had in terms of prior guidance. Please remind us as to what's going on there. William J. Gerber: Yes, basically, it's the increase of 2 things. One is the increase in the float. Obviously, it's more front-end loaded when rates go up at the short end of the curve. And second is, since we changed the agreement with TD back at January 1, really investing in the 2- to 3-year area of the curve, it's really been very, very small benefit. So we decided to not invest in that part of the curve. And so what you're seeing is more in the short end. And so to your point, we haven't been investing in that area where the $0.50 is in year 3. We haven't been laying out more assets out there. So consequently, it's pushed out.

Okay, great. And then just on the investment fee product line. The 25% -- the 15% to 25% growth forecast, I mean, this has been a great product for you guys of late. But I mean, what do you see is the biggest risk to continued growth at those levels? Fredric J. Tomczyk: Well, obviously, the market and market environment would be the biggest risk. So if the market went down 15% a year, that would be a hard number to hit. And I think it also affects the ability to sell the bond.

The next question is from Chris Shutler of William Blair.

In the RIA space, obviously, you're having a lot of success with breakaways. But just wondering if you could comment just directionally on the size of RIAs that you're bringing onto the platform today versus 1 year or 2 ago. And then do you have any sense if you're getting a larger portion of those RIAs books? Fredric J. Tomczyk: I don't have an off-the-top-of-my-head comment on the size of the larger percentage of their book, but we are getting larger RIAs. We've been focusing on moving up a bit to get the larger clients. We've also been focusing on getting the more active clients as we introduce the strategy desk and options and some technology to the RIA community. It helped allowed us to actually attract the bigger advisors that are probably more asset manager-like. So we definitely have been getting bigger advisors.

Okay, great. And then on the investment product fee, should we expect you guys to add new components to those -- to that product line over the next 12 months? Fredric J. Tomczyk: Yes. I would say, yes on Amerivest we'll probably add 1 or 2 more sort of investment styles in their -- the long-term answer to that, Amerivest will be a family of mutual fund and ETF wrap programs basically or packaged products.

And the next question is from Gaston Ceron of Morningstar Equity Research. Gaston F. Ceron: Just had a quick question about the -- I don't know if you mentioned this earlier and I missed it, but on the average commission fees per trade, obviously, that trended up pretty strongly in fiscal 2013. And I guess, I think it was -- I think you guys have got $12.61 for the whole year, so -- and for the last quarter, too, I think. So that would be close to the end, I think. I think that will be close to the near end of your range for next year. Just kind of curious about how you see that line in general trending forward. William J. Gerber: Yes. I think it's going to be -- it's going to remain pretty strong here. So we had very strong payment for order flow, and particularly in the option business. And as the option business continues to grow, we should see continued payment in there. So I am cautiously optimistic, I should say, that we're going to stay in this range for an indefinite period. Gaston F. Ceron: Okay. And then lastly, just wondering if there is any sort of update or thoughts on consolidation and M&A in the industry? Fredric J. Tomczyk: Well, we don't normally -- don't comment too much on M&A. But I think it's suffice it to say, we've always kept an eye open for entering the mix in strategic and financial sense. And I think, as evidenced by our returning capital as aggressively as we can, we really don't see anything on the near-term horizon that would make financial sense.

And this concludes our question-and-answer session. I'd like to turn the conference back over to Fred Tomczyk for any closing remarks. Fredric J. Tomczyk: Well, thank you, everyone, and thanks for joining us today. As you can see, we're pretty proud of our 2013 results, and in fact, our asset gathering over the last 5 years. We feel very good about that. I think the company has transitioned and become what we set out to do 5 years ago. We have our balance sheet where we are. We've been good stewards of shareholder capital. And it is management's goals and objectives to continue that pace of growth, and to be those good stewards of shareholder capital going forward. With that, we'll talk to you next quarter. Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.