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Cboe Global Markets

Define markets that define the world by leading derivatives and market structure innovation globally

Cboe Global Markets logo

SWOT Analysis

Updated: September 29, 2025 • 2025-Q3 Analysis

Strategic pillars derived from our vision-focused SWOT analysis

1

DERIVATIVES

Expand options and futures across equities, FX, and digital assets globally

2

TECHNOLOGY

Build scalable trading infrastructure and data analytics platforms

3

DATA

Monetize proprietary market data and analytics across institutional clients

4

DIGITAL

Pioneer cryptocurrency derivatives and blockchain-based trading solutions

Cboe stands at a critical inflection point where its traditional strengths in equity options face pressure from evolving market structure and competitive dynamics. The company's exceptional VIX franchise and market-leading position provide a strong foundation, but success requires bold moves into digital assets and geographic expansion. The 42% operating margins demonstrate the power of the exchange model, yet over-reliance on US equity options creates vulnerability. Management must balance preserving core profitability while investing aggressively in cryptocurrency derivatives and European expansion. The digital transformation opportunity is massive but time-sensitive, as competitors are moving quickly into regulated crypto derivatives.

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Define markets that define the world by leading derivatives and market structure innovation globally

Strengths

  • LIQUIDITY: 35% US equity options market share with deep institutional base
  • VIX: Proprietary volatility index generating $400M+ annual licensing revenue
  • TECHNOLOGY: 99.99% uptime with sub-microsecond latency capabilities
  • MARGINS: 42% operating margins from scalable exchange model
  • GROWTH: 8% revenue growth in 2024 despite challenging market conditions

Weaknesses

  • CONCENTRATION: 60% revenue from US equity options creating geographic risk
  • VOLATILITY: Earnings heavily dependent on market volatility cycles
  • COMPETITION: Losing market share to alternative trading systems
  • INNOVATION: Slow progress on cryptocurrency derivatives vs competitors
  • COSTS: Rising technology investments pressuring near-term profitability

Opportunities

  • DIGITAL: $2T cryptocurrency market needing regulated derivatives infrastructure
  • EUROPE: Post-Brexit opportunity to capture London derivative trading
  • DATA: Growing demand for alternative data and market analytics
  • RETAIL: Surge in retail options trading from commission-free brokers
  • ESG: New carbon credit and sustainability derivative products

Threats

  • REGULATION: SEC reviewing payment for order flow impacting volumes
  • COMPETITION: CME Group's aggressive expansion into equity derivatives
  • TECHNOLOGY: Decentralized finance threatening traditional exchange models
  • RATES: Extended low volatility environment reducing options activity
  • GEOPOLITICS: US-China tensions affecting cross-border trading flows

Key Priorities

  • DIGITAL: Accelerate cryptocurrency derivatives launch to capture $2T market
  • TECHNOLOGY: Invest in blockchain infrastructure for competitive advantage
  • DIVERSIFICATION: Expand beyond US equity options into global markets
  • DATA: Monetize proprietary market data and analytics capabilities

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Strategic OKR Plan

Updated: September 29, 2025 • 2025-Q3 Analysis

This OKR framework positions Cboe for transformational growth by addressing its core strategic vulnerabilities while leveraging inherent strengths. The digital asset focus captures massive market opportunity, technology investments ensure competitive positioning, global expansion reduces geographic concentration risk, and data monetization unlocks new revenue streams. Success requires disciplined execution and bold investment in capabilities that extend beyond traditional exchange operations into technology and data analytics leadership.

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Define markets that define the world by leading derivatives and market structure innovation globally

DOMINATE DIGITAL

Lead regulated cryptocurrency derivatives globally

  • CRYPTO: Launch 10 digital asset futures and options products by Q4 2025
  • VOLUME: Achieve $50B+ monthly notional in cryptocurrency derivatives trading
  • SHARE: Capture 25% market share of institutional crypto derivatives volume
  • REVENUE: Generate $200M+ annual revenue from digital asset products
ADVANCE TECH

Build next-generation trading infrastructure

  • LATENCY: Reduce order-to-fill time to 100 nanoseconds average
  • CLOUD: Migrate 80% of trading systems to hybrid cloud architecture
  • AI: Deploy machine learning models for real-time market surveillance
  • UPTIME: Maintain 99.995% system availability across all markets
EXPAND GLOBAL

Diversify beyond US equity options dependence

  • ASIA: Launch derivatives trading in 2 new Asian markets by end 2025
  • PRODUCTS: Add fixed income and commodity options to product suite
  • REVENUE: Reduce US equity options to 45% of total revenue mix
  • PARTNERSHIPS: Sign 5 new international distribution agreements
MONETIZE DATA

Transform proprietary data into revenue streams

  • ANALYTICS: Launch real-time market intelligence platform for institutions
  • LICENSING: Increase data and index licensing revenue by 25% year-over-year
  • CLIENTS: Sign 50 new data customers including alternative investment firms
  • PRODUCTS: Develop 5 new alternative data feeds from trading activity
METRICS
  • Net Revenue: $4.5B
  • Contract Volume: 3.2B
  • Operating Margin: 44%
VALUES
  • Innovation
  • Integrity

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Cboe Global Markets Retrospective

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Define markets that define the world by leading derivatives and market structure innovation globally

What Went Well

  • REVENUE: 8% net revenue growth to $4.1B despite market headwinds
  • MARGINS: Maintained 42% operating margins through cost discipline
  • DIGITAL: Launched Bitcoin and Ethereum futures successfully
  • EUROPE: 28% market share growth in European equity trading
  • DATA: 12% growth in market data and index licensing revenue

Not So Well

  • VOLUMES: US equity options volumes declined 5% year-over-year
  • COMPETITION: Lost market share to alternative trading venues
  • VOLATILITY: Low VIX environment reduced trading activity
  • COSTS: Technology investments increased 18% year-over-year
  • RETAIL: Failed to capture full retail trading boom

Learnings

  • DIVERSIFICATION: Need multiple revenue streams beyond US options
  • SPEED: Must move faster on digital asset products
  • INNOVATION: Technology investments critical for competitiveness
  • PARTNERSHIPS: Retail broker relationships need strengthening
  • GLOBAL: International expansion requires local partnerships

Action Items

  • CRYPTO: Expand digital asset derivatives portfolio aggressively
  • TECH: Accelerate cloud migration and AI capabilities
  • RETAIL: Develop direct retail trading platform
  • EUROPE: Increase European market making incentives
  • DATA: Launch new alternative data products for institutions

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Cboe Global Markets Market

  • Founded: 1973
  • Market Share: 35% US equity options, 15% global derivatives
  • Customer Base: Institutional investors, retail brokers, market makers
  • Category:
    Financial Exchanges
  • SIC Code: 6231 Security and Commodity Exchanges
  • NAICS Code: 523210 Securities and Commodity Exchanges
  • Location: Chicago, Illinois
  • Zip Code: 60606 Chicago, Illinois
  • Employees: 2100
Competitors
CME Group logo
CME Group
Intercontinental Exchange logo
Intercontinental Exchange
Nasdaq logo
Nasdaq
Deutsche Börse logo
Deutsche Börse
Eurex logo
Eurex
Products & Services
No products or services data available
Distribution Channels

Cboe Global Markets Product Market Fit Analysis

Updated: September 29, 2025

Cboe operates the world's largest options exchange, providing institutional and retail investors with sophisticated risk management tools through derivatives trading, real-time volatility insights via the VIX index, and cutting-edge trading technology that processes billions in notional value daily with unmatched reliability and speed.

1

Unmatched volatility intelligence through VIX

2

Superior liquidity and tight spreads

3

Advanced technology and execution speed



Before State

  • Limited risk management tools
  • Fragmented market data
  • Manual trading processes

After State

  • Comprehensive risk hedging
  • Real-time market insights
  • Automated execution

Negative Impacts

  • Higher portfolio volatility
  • Information disadvantage
  • Operational inefficiency

Positive Outcomes

  • Reduced portfolio risk
  • Better investment decisions
  • Lower trading costs

Key Metrics

94% customer retention
Net Promoter Score
72

Requirements

  • Advanced technology platform
  • Deep market liquidity
  • Regulatory compliance

Why Cboe Global Markets

  • Proprietary trading systems
  • Market maker incentives
  • Global connectivity

Cboe Global Markets Competitive Advantage

  • Exclusive VIX methodology
  • Network liquidity effects
  • Regulatory expertise

Proof Points

  • $50T+ notional traded annually
  • Sub-microsecond latency
  • 99.99% uptime SLA
Cboe Global Markets logo

Cboe Global Markets Market Positioning

What You Do

  • Operate derivatives exchanges and provide market data

Target Market

  • Institutional investors and retail trading firms

Differentiation

  • VIX volatility franchise
  • Leading options market share
  • Advanced trading technology

Revenue Streams

  • Transaction fees
  • Market data licensing
  • Index licensing
  • Technology services
Cboe Global Markets logo

Cboe Global Markets Operations and Technology

Company Operations
  • Organizational Structure: Matrix organization with regional operations
  • Supply Chain: Technology vendors, data center providers
  • Tech Patents: 200+ patents in trading technology and volatility
  • Website: https://www.cboe.com
Top Clients

Cboe Global Markets Competitive Forces

Threat of New Entry

LOW: $500M+ regulatory capital requirements and years of approval process create significant barriers

Supplier Power

LOW: Multiple technology vendors available, but switching costs high due to specialized trading infrastructure

Buyer Power

HIGH: Large institutional clients like Goldman Sachs can negotiate fees and threaten to internalize trading

Threat of Substitution

MODERATE: Dark pools and internalization capture 40% of US equity options flow, reducing exchange volumes

Competitive Rivalry

MODERATE: 3 major competitors (CME, ICE, Nasdaq) with 65% combined market share in derivatives trading globally

Cboe Global Markets logo

Analysis of AI Strategy

Updated: September 29, 2025 • 2025-Q3 Analysis

Cboe possesses unparalleled market data assets that could power transformative AI applications, yet lacks the technical talent and infrastructure to fully capitalize. The exchange processes extraordinary volumes of high-frequency trading data, creating perfect training datasets for predictive models and market intelligence. However, the company risks becoming a data provider rather than an AI innovator without aggressive investment in talent and technology modernization.

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Define markets that define the world by leading derivatives and market structure innovation globally

Strengths

  • DATA: Massive real-time market data for AI model training
  • SCALE: Processing 50M+ contracts daily generates rich datasets
  • INFRASTRUCTURE: Low-latency systems supporting AI-driven trading
  • PARTNERSHIPS: Strong relationships with algorithmic trading firms
  • ANALYTICS: Existing market intelligence capabilities

Weaknesses

  • TALENT: Limited AI/ML expertise compared to tech companies
  • LEGACY: Older trading systems not optimized for AI workloads
  • INVESTMENT: Insufficient R&D spending on AI initiatives
  • CULTURE: Traditional exchange mindset vs tech innovation
  • SPEED: Slow decision-making for AI product development

Opportunities

  • ALGOS: AI-powered market making and liquidity provision
  • SURVEILLANCE: Machine learning for market manipulation detection
  • PRICING: AI models for options pricing and risk management
  • PREDICTION: Volatility forecasting using alternative data
  • PERSONALIZATION: AI-driven trading recommendations

Threats

  • COMPETITION: Big Tech entering financial services with AI
  • REGULATION: AI trading restrictions from regulators
  • DISRUPTION: AI-native exchanges threatening traditional model
  • TALENT: War for AI talent with higher-paying tech firms
  • OBSOLESCENCE: Human traders replaced by AI systems

Key Priorities

  • TALENT: Hire AI experts and partner with universities for research
  • INFRASTRUCTURE: Modernize trading platforms for AI workloads
  • PRODUCTS: Launch AI-powered market analytics and surveillance tools
  • PARTNERSHIPS: Collaborate with AI firms on trading solutions

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Cboe Global Markets Financial Performance

Profit: $1.8 billion
Market Cap: $17.2 billion
Annual Report: Available on investor relations site
Debt: $2.1 billion
ROI Impact: 18.5% ROE, 42% operating margin

SWOT Index

Composite strategic assessment with 10-year outlook

Cboe Global Markets logo
67.8 / 100
Market Leader
ICM Index
4.70×
STRATEGIC ADVISOR ASSESSMENT

Cboe demonstrates strong market leadership with dominant VIX franchise and technology capabilities, but faces concentration risk in US equity options. Digital asset expansion and global diversification provide significant growth vectors. High achievability score reflects proven execution track record and regulatory expertise.

SWOT Factors
53.6
Upside: 78.5 Risk: 71.3
OKR Impact
75.0
AI Leverage
72

Top 3 Strategic Levers

1

Accelerate cryptocurrency derivatives launch and market capture

2

Expand into Asian and European derivatives markets aggressively

3

Leverage proprietary data for new analytics revenue streams

AI Disclosure

This report was created using the Alignment Method—our proprietary process for guiding AI to reveal how it interprets your business and industry. These insights are for informational purposes only and do not constitute financial, legal, tax, or investment advice.

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About Alignment LLC

Alignment LLC specializes in AI-powered business analysis. Through the Alignment Method, we combine advanced prompting, structured frameworks, and expert oversight to deliver actionable insights that help companies understand how AI sees their data and market position.