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Stock Strategist Industry Reports

CME and CBOE Reaping the Benefit of August's Trading Spike

A look at two derivative-trading venues.

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Two of the publicly traded financial exchanges on our coverage list are scheduled to unveil third-quarter earnings next week. Both  CME Group (CME) and  CBOE Holdings (CBOE) should benefit from the trading spurt seen in August, when market turmoil drove investors into a frenzy of activity that was unusual for what is often a quiet month. We expect both companies to report higher trading-related revenue.

Furthermore, barring a drastic turn during the fourth quarter, both exchange companies are on track to post volume gains for the year, in our view. CME, the Chicago-based derivatives exchange powerhouse, saw its average daily volume spike by 8.7% in the third quarter from the second, reaching its highest monthly tally ever in August, when the company's exchanges averaged nearly 17.1 million contracts per day. At CBOE, the CME neighbor that is the parent of two U.S. options exchanges, options trading volume shot up 25.2% during the quarter on a sequential basis.

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Gaston F. Ceron does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.