This Day In Market History: CBOE Becomes First Dedicated Options Exchange

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On this day in 1973, the Chicago Board Options Exchange opened for trading, becoming the first dedicated U.S. stock options exchange.

Where The Market Was: The Dow finished the day at 937.76. The S&P 500 traded at 108.89.

What Else Was Going On In The World? In 1973, OPEC announced it would be cutting crude oil supply to countries that supported Israel, sending oil prices skyrocketing 200 percent. The Supreme Court ruled in Roe v. Wade, guaranteeing American women the right to an abortion.The average U.S. worker earned $12,900 in annual income.

Options Trading Becomes Mainstream: The CBOE had a modest beginning in 1973, initially listing call options for just 16 U.S. common stocks. The dedicated options trading exchange provided the first standardized, orderly market for stock options, a huge first step in the options market becoming what it is today.

The CBOE introduced computerized trading just two years later and added put options starting in 1977.

Annual exchange volume eclipsed 100 million for the first time in 1984. By 2008, annual volume had topped 1 billion.

The CBOE went public as Cboe Global Markets Inc CBOE in 2010 and is now valued at a market cap of more than $12 billion.