Exchange operator Cboe posts record profit on hedging rush
May 2 (Reuters) - Derivatives exchange Cboe Global Markets (CBOE.Z), opens new tab reported a record first-quarter profit on Friday and boosted its annual revenue growth forecast as heightened market volatility fueled strong growth in options trading.
Exchanges thrive during times of market turmoil as trading volumes surge and investors hedge their portfolios to manage risk, driving up transaction and clearing fees for companies such as Cboe.
Rivals CME Group (CME.O), opens new tab and NYSE-parent Intercontinental Exchange (ICE.N), opens new tab also had record-breaking quarters as a barrage of tariff-related headlines and the emergence of Chinese startup DeepSeek's low-cost AI model drove up market volatility.
Revenue from Cboe's options trading arm jumped 15% to an all-time high of $352.4 million. Its global FX and Europe and Asia Pacific businesses also fetched record revenue in the quarter.
Cboe now expects full-year revenue growth in the mid- to high-single-digit percentage range, up from its previous forecast of mid-single-digit growth.
"The second quarter is off to a robust start, and we look forward to ... providing clients with a diverse toolkit of products for any market environment," outgoing CEO Fredric Tomczyk said.
Its average daily volume in index options hit a quarterly record of 4.8 million contracts, a 17% jump from a year earlier.
The rising popularity of options trading as well as increased activity from retail investors also boosted Cboe's business.
Cboe late on Thursday named rival CME former top boss Craig Donohue as its new CEO, effective May 7.
He succeeds Tomczyk, who has been at the helm since September 2023 and steered Cboe through a challenging time after the abrupt departure of former CEO Edward Tilly.
Excluding one-time costs, Cboe earned a record $2.50 per share for the quarter, beating analysts' expectations of $2.36, according to estimates compiled by LSEG.
Revenue jumped 13% to a quarterly record of $565.2 million, beating expectations of $560 million.
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There has been another £150 million for the ScotZEB programme 'to deliver zero-emission buses to Scotland's roads', the latest in a series of capital funds without which there would be precious few new or refurbished buses on our highways and by-ways. Advertisement Hide Ad Advertisement Hide Ad Put these two facts together and the prospective loss of a bus manufacturing industry in Scotland borders on the incomprehensible. Beyond buses, if a 'procure in Scotland' strategy cannot be applied in this case, what hope is there of enforcing local content provisions in other sectors, notably renewable energy? Without political backbone, it won't happen. Ensuring the survival of Scotland's bus network is a good use of public funds. Equally, for any government to invest this kind of money and then claim it has no leverage over where it is spent is preposterous – and that should be the starting point in addressing the future of Alexander Dennis Ltd and maintaining a proud, skilled industry. 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Ms Forbes' attempt at self-exoneration also failed the credibility test on multiple grounds. Most obviously, the publicly owned Greater Manchester Bees Network has purchased 160 state of the art buses from Falkirk and is delighted with the product. Somehow, the office of Andy Burnham found a way through challenges which Ms Forbes portrays as show-stoppers. Did she or her civil servants ever pick up the phone to Manchester? In the last few days, in an effort to head off redundancies, the Secretary of State for Scotland, Ian Murray, has written to all the Metro Mayors in England, who will soon be ordering buses, asking them to follow Manchester's example. Meanwhile, the Scottish Government claims to be helpless while the orders it funds flow out to China. The legislation which supposedly presents such an obstacle to the Scottish Government is the Subsidy Control Act of 2022 which replaced what existed pre-Brexit. 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Economist
a day ago
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Can you pass the toughest tests in the world?
Civil-service exams in China and India are notoriously difficult. But they shape their countries' societies Max Weber, sensible German intellectual that he was, considered bureaucracy the best way to organise large societies. And societies don't come any larger than China and India, where the decisions of bureaucrats shape the lives of more than a quarter of the world's people. Even as the countries' private sectors have grown in recent decades, jobs in their civil services remain deeply coveted. Government jobs in India, especially in the federal services that run the country, remain a ticket to prosperity, prestige and better marriage prospects. In China, where the economy has slowed, securing a top-tier state job (known locally as 'landing ashore') is back in fashion—quite literally. Young people sometimes don 'cadre-style' attire—windbreakers in muted colours and high-waisted suit trousers—in order to emulate officials. 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In China a record 3.41m people registered and passed the initial screening for the national civil-service exam last year—well over twice the number who did so in 2014. Just over 39,700 (1.5% of those who sat the exam) secured a job. In both countries the exams are considered the fairest way to filter candidates. Indeed, in India they were introduced by British colonial masters after Indians complained about the previous patronage-based system. In China, the guokao, as the exam is called, is modelled on the keju, which was instituted in 587 and was lauded for being relatively corruption-free and meritocratic. Candidates' ability to leapfrog social classes was so cherished that, say some academics, the riots that followed the exam's abolition in 1905 contributed to the toppling of the Qing dynasty, China's last imperial rulers, a few years later. The civil-service exam in China has shaped the country's evolution. The keju was the 'anchor of Chinese autocracy', according to Yasheng Huang, who has written a book about it. Mind-bogglingly difficult, it required total intellectual commitment, sometimes from the age of five, leaving the most talented and ambitious members of society no time to foment new ideas. Gui Youguang, a 16th-century writer, passed the exam's final stage aged 59, after decades of failed attempts, and died shortly after. The guokao, which can only be taken by those aged 35 or under, remains an important tool for the state. After China embarked on market reforms in the 1970s, the bureaucracy took on a more important role in a complex, open society. As a result, the guokao was tweaked to examine candidates' knowledge of laws and regulations. Over time the questions became more practical, testing common sense and numeracy. But in recent years the exam has also become a test of party loyalty, with ever more questions dedicated to Xi Jinping Thought. 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By 1979 competition to enter the service was so fierce that a second set of exams was introduced to test candidates' breadth of knowledge. In 2012 a paper on ethics was added. India's civil service is associated with prestige—but also corruption. In a recent high-profile example, a young civil servant in the eastern state of Odisha was accused of accepting a bribe of 1m rupees ($11,683) from a businessman. Indian essay questions Is conscience a more reliable guide when compared to laws, rules and regulations in the context of ethical decision-making? Discuss. Child cuddling is now being replaced by mobile phones. Discuss its impact on the socialization of children. Thinking is like a game, it does not begin unless there is an opposite team. Discuss. Success in both exams requires immense toil. Many examinees do not work in the year, even years, leading up to the test; those holding down jobs end up studying early in the morning or late at night. Thousands seek the help of coaching centres; the best ones offer full-time training and board. Shikha Singh, for example, moved from a small town in central India to Delhi just to prepare for the exam surrounded by fellow aspirants. She has failed the test three times, but ramped up her efforts with each attempt. Ahead of her recent fourth try, Ms Singh put in ten-hour days, but worries that still might not be enough to cover the wide variety of subjects. In south-eastern China, Ms Zhong, a prospective civil servant from Jiangxi province, has put in similar shifts since quitting her job in 2023 and moving back in with her parents. Her concern is that preparation alone may not be enough in an exam that tests 'innate ability'. Even if they succeed, will their effort be worth it? Those who pass the exams reap instant and long-term benefits, such as housing and a pension (and often a job) for life. Once in their roles they are treated like royalty, with an army of staff to do their bidding and a special chair marked with a white towel. Research from India suggests some correlation between exam performance and effectiveness as a civil servant. But in both countries critics believe the exams filter candidates according to the wrong criteria. By screening for rote-learning and test-taking, they neglect to assess actual public-policy skills such as management, teamwork and communication. This contributes to the poor performance of the bureaucracy. On a measure of government effectiveness calculated by the World Bank, China and India rank in the 74th and 68th percentiles globally. In both countries efforts are under way to recruit people in other ways. China is experimenting with hiring some candidates for fixed terms according to their experience, rather than their exam performance. Similarly India has introduced a 'lateral-entry' scheme to allow private-sector specialists to join the public workforce. But these remain nascent initiatives. Exams will remain the backbone of public-sector recruitment. If the merits of this selection process are debatable, the costs—both human and economic—are more easily quantified. Aspirants who fail to meet the mark tend to try again. A cycle of application and rejection has an effect on morale: exam failure often pushes candidates to suicide in both countries. Ms Singh, the Indian candidate, feels she has lost social status because of her failed attempts. Her Chinese counterpart, Ms Zhong, is also weighed down by anxiety. 'Only a few people pass the exam,' she says. 'I wonder what those who fail do.' It is an important question. Years of youth spent in study, instead of work, are an economic loss. The exams force college graduates to delay employment, reducing their long-term consumption. And the subjects so feverishly swotted up late at night are not necessarily of use once the exams are over. Knowing big cats' biological intricacies or the details of Xi Jinping Thought might help candidates earn a civil servant's towel-covered chair—but perhaps not a place in the private sector.
