Cboe Global Markets

Cboe Global Markets, Inc. (formerly CBOE Holdings) is an American financial exchange operator headquartered in Chicago. It owns and operates a portfolio of exchanges and trading venues across equities, options, futures, and digital assets.

Founded in 1973 as the Chicago Board Options Exchange (CBOE), the company also owns the stock exchange operator BATS Global Markets. Cboe is known for products such as the VIX volatility index for operating markets in North America, Europe, and Asia-Pacific.

Founded by the Chicago Board of Trade in 1973 and member-owned for several decades, the Chicago Board Options Exchange was the first exchange to list standardized, exchange-traded stock options, and began its first day of trading on April 26, 1973, in celebration of the 125th birthday of the Chicago Board of Trade.

In 1969, the vice chairman of the Chicago Board of Trade, Edmund "Eddie" O'Connor, developed the idea for an options exchange. At that time, options on stocks were traded in a New York-based, over-the-counter market which required a direct link between the buyer and seller and complex terms of sale. The options exchange that O'Connor imagined would use a central clearinghouse to facilitate trades and stand behind contracts. The Chicago Board of Trade established a committee to evaluate the concept.

The options market idea faced resistance from officials at the Securities and Exchange Commission. The CBOT hired Joseph Sullivan to address regulator concerns and present the concept to the New York brokerage community. In October 1971, the SEC relented and approved the effort.

In February 1972, the Chicago Board Options Exchange was incorporated as an independent body with its own bylaws and governing board. Joseph Sullivan became the president of the organization. Trading commenced on the exchange on April 26, 1973, and was conducted in the former CBOT smoking lounge. During its first full month of operation, 34,599 contracts were traded. By 1976, the monthly volume of trades had increased to 1.5 million.

Over the next decade CBOE continued to operate from its location within the CBOT building. In 1984, CBOE moved to its next headquarters across the street at 400 S. LaSalle Street.

On January 19, 1993, the Chicago Board Options Exchange introduced the CBOE Volatility Index (VIX), created by Vanderbilt University finance professor Robert E. Whaley to measure 30-day implied volatility of S&P 100 options. In 2003, the underlying benchmark for the VIX was changed to the S&P 500. The company launched tradable products using VIX as the underlying index. Cboe developed and launched a futures exchange, and in early 2004 the company began trading VIX futures, after a survey of Goldman Sachs salespeople showed interest in trading VIX futures.