Cboe Global (CBOE) Reports Solid June Volumes, Guides Q2 RPC
Cboe Global Markets, Inc. CBOE posted total average daily volume (ADV) of 10.8 million contracts, which surged 48.2% year over year driven by solid performance in Options, partly offset by lower Futures volume. Though U.S. Equities and Global Forex witnessed increase, European Equities declined.
Total contracts for the month were nearly 194 million, up 63% year over year. Of this, Options improved 64.9% to 234.2 million while Futures decreased 2.2% to 4 million. Options’ ADV was 10.6 million whereas Futures’ ADV was 0.2 million.
Total volumes of U.S. Equities came in at 44.4 billion shares, up 101.6% year over year. European Equities reflected a 0.3% deterioration year over year to €156.9 billion whereas Global FX increased 15.1% to $761 billion.
CBOE Global should continue witnessing solid average daily volumes, given its compelling product portfolio, which drives transaction fees that account for the lion’s share of total operating revenues.
This Zacks Rank #3 (Hold) derivatives exchange in the United States has a strong market position and global reach with strength in its proprietary products, primarily SPX options, VIX options and VIX futures.
With respect to revenues per contract (RPC), Cboe Global estimates second-quarter Options RPC to be in line to up 1% from the two months ended May 31 average, largely driven by higher RPC projected for multi-listed options for June that in turn is driven by lower volume-related rebates in June. RPC for Futures is expected to be in line with the two-month ended May 31 average.
Shares of CBOE Global Markets have lost 21.9% year to date, compared with the industry’s decline of 3.1%. Nonetheless, diversified product portfolio, compelling growth, expense synergies, increasing transaction fees and solid liquidity position should continue to help shares bounce back.
Recently, MarketAxess Holdings Ltd. MKTX, CME Group Inc. CME and Intercontinental Exchange, Inc. ICE reported trading volume for June 2019. MarketAxess reported trading volume of $578.5 billion consisting of $266.5 billion in credit volume and $312.0 billion in rates volume. Intercontinental’s ADV decreased 19.1% to 5.3 million largely attributable to lower Commodities and Financial ADV. CME Group reported ADV for June 2020 of 17.1 million contracts per day, down 26% year over year attributable to lower volumes in five of the six product lines.
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