CBOE Reports Record Q1 2016 Results Improving on Q4 2015 Metrics

Chicago-based CBOE Holdings, Inc. which trades on the NASDAQ under ticker symbol CBOE, today reported its first quarter (Q1) financial results for 2016, with net income reaching $49.2 million and up 17% Year-over-Year (YoY), with $0.60 cents per shared on a diluted basis up 20% over the same period, according to a company press release.

The group’s operating revenue for Q1 was $162.3 million, up 14% on a year-over-year basis when compared to $142.8 million reported in Q1 2015. Trading volumes were also higher quarter-over-quarter (QoQ), yet the amount of revenue per contract dipped slightly as the number of trading days were 61 in Q1 compared to 64 during Q4.

Despite the strong quarter, the earnings per share of 60 cents were a penny short of the 61 cents consensus, and the -2% dip in the company stock price this morning appears to be in line with the broad market and key competitors such as Deutsche Borse which also traded down over 2% this morning, around time of the news.

Commenting in the official press release, CBOE Holdings’ CEO Edward T. Tilly said: "Our first-quarter results reflect the strong contribution and utility of our proprietary products. S&P 500Index (SPX) options, Russell 2000 Index (RUT) options and CBOE Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term Index (VIX) futures and options posted a 28 percent rise in trading volume, significantly outpacing the 3 percent increase reported for multiply-listed options traded industrywide."

Mr. Tilly added: "Moreover, our team is energized by the opportunities we see for ongoing growth as a result of advancing our strategy to continue to define and lead the options and volatility space globally, develop unique products, Leverage Leverage In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders In financial trading, leverage is a loan supplied by a broker, which facilitates a trader in being able to control a relatively large amount of money with a significantly lesser initial investment. Leverage therefore allows traders to make a much greater return on investment compared to trading without any leverage. Traders seek to make a profit from movements in financial markets, such as stocks and currencies.Trading without any leverage would greatly diminish the potential rewards, so traders Read this Term strategic alliances and expand our customer base."

According to the update, the amount of transaction fees earned rose 20% during Q1 driven by a 19% increase in the average revenue per contract (RPC) even as trading volume of 291.3 million contracts was little-changed comparing YoY.

The higher RPC was said to reflect a shift in the ratio of products traded as a higher proportion of volume came from index options and futures contracts which have the highest RPC, and these product categories represented 42.4% of trading volumes in Q1 2016, compared with 33% YoY.