CBOE Futures Exchange Migrates to Proprietary BATS Technology

The acquisition of BATS on part of the CBOE yields changes in tech.

The CBOE’s Futures Exchange (CFE) has successfully migrated to a proprietary technology platform developed by BATS Global Markets. The transition is a result of the merger deal executed between the firms last year.

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The CFE is the first legacy platform that is adopting BATS technology. On the day of the launch of the new execution mechanism, a total of almost 160,000 contracts changed hands with 98 trading firms sending orders.

The next transition in sight is the migration of the CBOE’s C2 exchange. The migration date has been set for May 14th, 2018. Further to that, the CBOE Options Exchange is expected to be transitioned next. The final date for the migration is to be confirmed in April.

The changes are part of a multi-year technology integration strategy on part of CBOE and BATS.

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New Technology Details

Trading operations via the new technology platform started on Sunday, February 25th at around 1700 Central Time. The CBOE has listed some of the new features of the new tech, including a new order-by-order market data (PITCH) feed, which provides microsecond timestamps offering greater visibility into the CFE.

The offering also includes enhanced Bandwidth/Port Order rate thresholds, which have increased 100 times their previous thresholds, more than 80% latency reduction, enhanced risk controls and self-trade prevention. The new tech from BATS also leads to improved complex spread order handling and adds a fully-featured Customer Web Portal for trading and clearing firms.

Commenting on the launch, the Chairman and Chief Executive Officer of the CBOE, Ed Tilly, said: “The flawless migration of CFE to Bats state-of-the-art technology is a major step in the operational integration of our exchange platforms. This and our successive migrations will culminate in our ability to offer our customers a common, world-class trading experience across all our equities, options and futures markets.”

The team that has been in charge of the operation is led by Chris Isaacson who is Chief Information Officer of CBOE. Commenting on the process, he added: “Our goal was to make the trading experience more efficient and user-friendly, and match that with the same great customer service we’ve always offered our customers globally.”

“It is worth noting that our ability to keep to an aggressive timeline for our technology migration is due to the dedication of our fantastic team and the diligent preparations of our customers,” he said.

The CBOE is also planning to implement a migration of the S&P 500 Index (SPX) options to Hybrid trading. The event is planned for the second quarter. The company is also planning to introduce new floor terminals in the second half of 2018.

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