Cboe's Beginnings in the Words of Our Founding President

April 23, 2023

Joe Sullivan, Cboe's founding president, wrote a memoir that details the creation of Cboe -- originally the Chicago Board Options Exchange. He shares unique insight into the exchange's early days and the resolve of our founders, who knew they were onto something revolutionary.

Joe Sullivan was a pioneer in the financial world, having founded the Chicago Board Options Exchange, or what we call today Cboe, on April 26, 1973. Cboe was the first exchange to offer standardized options trading, which revolutionized the way that options were traded and paved the way for the development of the modern options market.

In a 2019 memoir written for the SEC Historical Society, Joe Sullivan describes the early days as “the most exhilarating and momentous years of my life. I thrived on each new challenge and would write white papers describing our handiwork. As the challenges mounted so did my responsibilities.”

That spirit of innovation remains the lifeblood of Cboe Global Markets today as Cboe associates embody Sullivan’s desire to make his “dream become a reality.”

In the early 1970s, Sullivan saw a need for a market for standardized options contracts. At the time, options were traded over-the-counter, which made it difficult for traders to find counterparties and negotiate terms. Sullivan saw an opportunity to create a centralized market for options trading, which would make it easier for traders to buy and sell options.

With the help of several other traders, Sullivan founded Cboe in 1973. In his SEC memoir, he writes:

“For those of us who had assembled for the opening ceremony, it was anything but clear what the CBOE’s destiny would be. The ceremony took place in what until a few months prior had been a musty smoking room adjoining the Chicago Board of Trade’s huge commodity futures trading floor. But now the room was rimmed by eight boothlike trading posts topped by big CRT screens that would display the prices of financial instruments the likes of which the world had never seen before.”

Cboe began trading on April 26, 1973 with just a handful of stocks, but it quickly grew in popularity as traders realized the benefits of standardized options trading. It soon became the go-to destination for options traders.

Sullivan was a visionary who understood the potential of options trading long before many others did. He saw the benefits of a listed options market, and he worked tirelessly to make that vision a reality. His contributions to the financial world have been significant, and his legacy continues to inspire new generations of traders, entrepreneurs and, of course, Cboe associates.

Joe Sullivan passed away in 2020 at the age of 82, but his impact on the financial world lives on. The Cboe that he founded remains one of the most important exchanges in the world, and options trading continues to be a critical component of the global financial system. Sullivan's contributions to the options market will be remembered for generations to come, and his legacy serves as a reminder of the power of innovation and entrepreneurship in the financial world.

To read his full memoir, visit the SEC Historical Society