CBOE’s New CEO Tilly Pledges to Expand VIX Trading

Edward Tilly, who will become chief executive officer of CBOE Holdings Inc. next year, said he will expand trading of the Chicago Board Options Exchange Volatility Index to drive growth at the biggest U.S. options market.

CBOE also plans to expand its customer base by setting up a new hub in London and focus on investor education. It will seek to increase business in customized trading technology, he said. Tilly, the Chicago-based company’s president and chief operating officer, is succeeding William Brodsky, who is stepping down after 16 years at the exchange, according to a statement from the company today.

“VIX and its expansion is key,” said Tilly in an interview today. “The growth there has been unique to us and we want to ensure the trajectory continues.”

CBOE, the largest of nine American options markets, saw the most trading ever in August for its exclusive options on the VIX, which accounts for about 10 percent of revenue, according to Macquarie Group Ltd. The VIX measures the cost of using options as insurance against declines in the Standard & Poor’s 500 Index.

The exchange last month reported third-quarter profit that beat analyst projections as options volume surged. Trading rose 47 percent to a record 5.48 million contracts per day, on average.

Tilly was a market maker and CBOE member between 1989 and 2006, according to the company’s website, and was named to his current post in November 2011. Edward Provost, the chief business development officer, will succeed Tilly as president and COO, according to today’s statement.

Tilly said today he will focus on driving growth at CBOE as “a standalone” company. The CBOE, started in 1973 as the first U.S. equity derivatives market, became the last major American bourse to convert to shareholder ownership with its 2010 initial public offering.


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