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Reuters
02-05-2025
- Business
- Reuters
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.
Reuters
13-03-2025
- Business
- Reuters
Texas Stock Exchange hires top ETF executives from Cboe, Nasdaq
March 13 (Reuters) - The Texas Stock Exchange (TSXE), still months away from winning regulatory approval to begin operations, said it hired senior exchange-traded funds executives from Cboe Global Markets and Nasdaq to win a share of trading in the $11 trillion U.S. ETF market. It announced on Thursday that Robert Marrocco, formerly global head of ETP, or exchange-traded products, listings at Cboe Global Markets (CBOE.Z), opens new tab, will take on the same role at TXSE and Alison Hennessy, the former head of ETP listings at Nasdaq (NDAQ.O), opens new tab, will become managing director of exchange traded products. here. The hirings signal the Texas exchange views the ETF arena as key to its future growth, analysts said. "The fact that they are poaching top talent from two of the three biggest exchanges sends a clear signal that they are to be taken seriously" as a future competitor in the ETF sector, said Bryan Armour, ETF strategist at Morningstar. The TXSE, which has disclosed that it has raised about $161 million in capital from some four dozen investors that include financial giants BlackRock (BLK.N), opens new tab, Citadel Securities and Charles Schwab (SCHW.N), opens new tab, filed paperwork in late January seeking regulatory approval to operate a national securities exchange. It hopes to win approval later this year and to begin listing and trading in early 2026. The hirings not only bolster the TXSE's roster but also may end up creating challenges for the incumbent exchanges, said one market structure analyst, who asked not to be named because his firm does not permit him to comment publicly. In a rapidly growing area such as ETFs, losing top executives to a potential rival is "less than ideal," the analyst said. "Together, these leaders managed more than 40% of all (exchange-traded products) in the United States," the Texas exchange said in a press release. A spokesperson for Nasdaq declined comment on Hennessy's departure. "We wish them well in their future endeavors," Cboe said in an statement, referring to Marrocco and two other Cboe staffers that TXSE also hired. In its press release, TXSE said that under Marrocco's leadership since 2020, Cboe captured nearly 30% of all new ETP listings. Marrocco did not respond to requests for comment and a TXSE spokesperson said neither he nor Hennessy were available to discuss their new roles. In a post on LinkedIn, he described TXSE as being "the next chapter of U.S. capital markets." Marrocco's hiring "indicates that TXSE could prioritize ETP listing, which is a relatively less competitive avenue compared to individual stock listing," said Owen Lau, a senior analyst at Oppenheimer & Co. The three exchanges that dominate the U.S. stock and ETF trading market have already responded to the TXSE's moves to establish itself as a competitive force. Last month, the New York Stock Exchange announced plans to open its own NYSE Texas division.
