When Joseph Sullivan joined the Chicago Board of Trade in the late 1960s, he was a finance industry novice put in charge of a moonshot project to create the first marketplace for trading listed stock options.
A former Wall Street Journal political reporter, Sullivan worked tenaciously and eventually won over both industry skeptics and regulators at the Securities and Exchange Commission to launch the Chicago Board Options Exchange in 1973.
The CBOE, which spun off as a publicly traded company in 2010, grew into one of the world’s largest options exchanges and a staple of securities traders worldwide.
“He changed the face of American finance,” said Bill Brodsky, who served as CEO from 1997 to 2013.
Sullivan, who served as the inaugural president of the CBOE until 1979, died Oct. 2 at the age of 82 in Knoxville, Tenn., where he grew up and ultimately retired.
A Princeton University graduate, Sullivan earned a master’s degree in journalism from Columbia University and started his career in 1961 as a reporter for the Wall Street Journal in Atlanta. In 1963, he joined the newspaper’s Washington bureau, where he covered Congress for five years.
In 1968, Sullivan made a dramatic career change, going to work for the Board of Trade in Chicago, where he was put in charge of the options exchange project.
“It was a pie-in-the sky concept of trying to trade options on major U.S. stocks,” Brodsky said. “He had big hurdles to overcome.”
Patterned after the Board of Trade, the CBOE created standardized securities contracts — betting on the future price of IBM’s stock, for example — and a clearinghouse to act as intermediary between the option buyers and sellers. When it launched on April 26, 1973, the CBOE traded less than 1,000 contracts, Brodsky said.
The Chicago-based CBOE