David Howson Reflects on a Strong 2022

David Howson
December 23, 2022

To our Cboe community,

I hope many of you are well in the midst of holiday celebrations and enjoying the season with friends and loved ones. I myself am gearing up for my first Chicago winter and quickly learning the true value of a warm set of gloves. It’s been seven months since I assumed the role of Global President at Cboe and I cannot believe how productive 2022 was for Cboe and our industry across the globe.

Many of our business line leaders will be reaching out to you in January, but I wanted to provide a quick overview of all we achieved at Cboe before we ring in the new year. 2022 was another transformative year filled with problems solved and ideas come to life. We continued to grow our business, integrate our acquired companies and connect with each of you across the globe.

This was also the first full year since the start of the pandemic where we could gather in-person more easily and more often, and what a difference it made. We held our first Cboe RMC since 2020 in Reykjavik, Iceland—bringing back an important opportunity to connect in-person to solve industry challenges and discuss the latest risk management strategies. It was terrific to see so many familiar faces at RMC and several other industry conferences throughout the year.

In 2022, connection also remained a key part of our business strategy, perhaps most tangibly through the opening of our new state-of-the-art trading floor. I began my career on a trading floor in London in the late 90s, delivering data and trading system solutions to run a derivatives, open-outcry exchange. It’s always been exciting to see that liquidity formation and open-outcry flow and now I can once again call the trading floor home – this time in Chicago.

Our trading floor houses six multi-listed equity options pits and four index options pits, including our largest, the S&P 500 Index (SPX) options pit, which was expanded to meet increased demand and accommodate more trading spots. We also significantly grew our suite of S&P 500 options throughout the year, adding new daily expirations in SPX Weeklys options and Mini-SPX options (XSP), offering 24/5 trading for both SPX and XSP options and launching Nanos and FLEX Micro options. Making our S&P 500 options suite more accessible through expanded trading hours, new expirations and different contract sizes has helped enable us to meet customer demand at every turn, especially as participation in trading shorter-dated options grows to new heights.

Importantly, with the launch of those products, we remained steadfast in our focus on investor education, led by the Options Institute (OI). The OI revamped its website and course offering this year, to provide a welcoming, unintimidating place for new investors to learn about our markets.

We were once again reminded in 2022 how important data is to our education efforts and the operation of our markets. Our launch of a new data cloud platform is enabling our teams to better handle increasing amounts of data with greater speed and efficiency, improving our capabilities for managing, mining, and analyzing that data internally across our global business and sharing those insights with our customers. Cboe also became Morningstar’s preferred index distributor and joined the Pyth network to bring some of our equities market data to blockchain.

As we rebranded Chi-X Asia Pacific to Cboe Australia and Cboe Japan in February, we kicked off the migration of the Chi-X platform to Cboe technology, which is on track for completion in early 2023 in Australia and by year end in Japan. Most recently, we rebranded EuroCCP to Cboe Clear Europe, once again further unifying our businesses and laying the foundation for continued growth and expansion of our clearing services.

In May, we officially completed the acquisition of ErisX, then rebranded the business to Cboe Digital in October to signal to the industry the growth and strength of our network. While the digital asset industry is still in the midst of uncertainty, Cboe Digital is well-prepared to step in as the stable leader that will help the industry rebuild.

In Canada, we completed the acquisition of NEO, growing our North American equities offering and global listings business. We also completed the migration of MATCHNow to Cboe technology and launched BIDS Canada, an excellent example of our long-term vision for fully integrating our acquired businesses to deliver new solutions. Not even a year since its launch, Cboe BIDS Canada continues to flourish, hitting a record volume of 28.2 million shares traded in November.

Across the pond, Cboe Europe Equities remained the largest pan-European stock exchange by market share for the fifth successive month, as of November. This achievement was driven in part by the expansion of our data and analytics services to help clients improve the quality of their executions and enhance their overall trading experience across our lit and dark order books, periodic auctions and Cboe BIDS Europe. Our new Cboe Europe Derivatives Exchange (CEDX) continued to build momentum with new market participants and increasing volume.

Finally, through our FX markets, investors could enhance yields with currencies as nations around the world responded to geopolitical tensions, supply chain issues, inflation and potential recessions. Investors turning to one of our asset classes to hedge new uncertainty encapsulates why we do what we do at Cboe. Our exchanges and platforms across 26 markets reliably provided a forum for investors to express their views and manage their risk.

But why does this scale matter? It is to meet you where you are. Operating our trusted markets in more areas expands our reach and enables our clients to pursue global growth opportunities. Our customer base is increasingly global, seeking coherent offerings across time zones that better enable them to optimize their services for their own clients. Cboe has transformed into a major global market operator. Our local expertise connected by a global network allows us to deeply understand where we operate our markets and provide customizable harmonized solutions that leverage our global breadth.

Our work this year laid the foundation for a strong 2023, our 50th year in business. In the year ahead, we’ll build on the momentum we’ve gained to imagine what’s possible for the next 50 years. As always, we very much welcome your thoughts and feedback as we work to create, innovate and develop unique solutions that address your needs.

Thank you all for a fantastic year.