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CBOE banks on Bob the hybrid

Many of the futures commission merchants favour a model for the US futures business that is suspiciously similar to that employed in the US options market. It's a model, conversely, that the futures exchanges are keen to avoid, as they have seen what effect it has had on the Chicago Board Options Exchange.

The CBOE is suffering from a substantial drop in volume. Brokers are leaving the pits to trade electronically upstairs either for their own account or for customers, often becoming price takers rather than market makers, as they used to be on the floor. Electronic rivals are snapping at the exchange's heels. Its technology platform needs updating. The price of a member's seat has plummeted to less than one-third of its peak just a few years ago. And now there are complaints about the leadership, with some suggesting that it's time for the chief executive to go.

"We've been having our own share of political problems here of late," admits Bill Brodsky, who has been chairman and chief executive of the CBOE for nearly seven years. He's a survivor. But he's not understating the drop in business. "We're in the securities business and the equities business, and that's been in a funk," he says.

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