Good day, everyone, and welcome to today's CBOE Holdings Second Quarter 2012 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded. At this time, for opening introductions, I would like to turn the call over to Debbie Koopman, Vice President, Investor Relations.

Thank you. Good morning and thank you for joining us on our second quarter conference call. On the call today, Bill Brodsky, our Chairman and CEO, will discuss the quarter and our strategic initiatives for 2012. Then Alan Dean, our Executive Vice President and Chief Financial Officer, will detail our second quarter 2012 financial results. Following their comments, we will open the call to Q&A. Also joining us for Q&A is our President and COO, Ed Tilly, and our Executive Vice President and Chief Business Development Officer, Ed Provost. In addition, I'd like to point out that this presentation will include the use of several slides. We will be showing the slides and providing commentary on each. A downloadable copy of the slide presentation is available on the Investor Relations portion of our website. As a preliminary note, you should be aware that this presentation contains forward-looking statements, which represent our current judgment on what the future may hold, and while we believe these judgments are reasonable, these forward-looking statements are not guarantees of future performance and involve certain assumptions, risks and uncertainties. Actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. Please refer to our filings with the SEC for a full discussion of the factors that may affect any forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, after this conference call. Now, I'd like to turn the call over to Bill Brodsky.

Thanks, Debbie. Good morning and thank you for joining us today. It is my pleasure to report another very positive quarter at CBOE Holdings, where we delivered our eighth consecutive quarter of adjusted earnings per share growth and made significant year-over-year gains in market share. Our strong performance in multi-listed products, our ability to leverage proprietary products and a prudent approach to cost management enabled our company to achieve solid financial results despite lower industry-wide trading volume. CBOE Holdings continues to generate and return enhanced value to our stockholders. We are especially pleased with our board's recent action to increase our quarterly dividend by 25% and to increase our share repurchase program by $100 million. My remarks today will focus on progress made in the quarter on our key strategic initiatives for 2012: product development; optimizing revenue in commoditized products; broadening our customer base; and leveraging our state-of-the-art trading technology. Turning first to product development, we remain keenly focused on our high-margin proprietary products, which include CBOE's S&P 500 options or SPX and options and futures on CBOE's volatility index, VIX. Our S&P 500 Index product line, which includes SPX, SPXpm and SPX Weeklys, carries our highest options rate per contract. Second quarter average daily volume in SPX rose 12% over the prior quarter and 10% over last year's second quarter, while trading in SPXpm increased 17% against the previous quarter. SPX Weeklys continued to be one of the year's fastest-growing products. Through June, in SPX Weeklys, trading is up 46% over the previous year, while the second quarter volume rose 54% over the previous quarter and 65% over the second quarter of 2011. We continue to design new SPX products to respond to specific customer needs. Last Friday, we launched SPX Variance Strips or V-Strips, which are aimed at…

Thanks, Bill, and good morning, everyone. As Bill highlighted, we reported solid financial results in the second quarter as we continue to focus on delivering industry-leading profit margins and growth rates. I'll provide a closer look at our financial performance, starting with a top-down review of our P&L. As seen on this slide, operating revenues increased by 10% while diluted earnings per share was up 22%. We achieved strong operating leverage, reporting an adjusted operating margin of 49.8%, 280 basis points higher than the prior year period, a function of our revenue growth and effective expense management. Before I continue, let me point out that our GAAP results reported for the second quarter of 2011 included certain unusual items that impact the comparison of our operating performance. These items are detailed in our non-GAAP information provided in the press release and in the appendix of our slide deck. As shown on this slide, operating revenues increased by $12.3 million or 10%, primarily driven by increases in transaction fees, exchange services and other fees and market data fees, offset somewhat by a decline in access fees. Transaction fees contributed $8.6 million of the revenue increase, representing a 10% increase compared with the second quarter of 2011. The growth was driven by an 8% increase in trading volume and a 2% increase in the average revenue per contract or RPC. We experienced higher trading volume across each of our product categories, with the strongest growth coming from our highest margin products, index options and VIX futures, which also had a positive impact on RPC. RPC increased to $0.314 compared with $0.308 in last year's second quarter, primarily due to a shift in the mix of products traded, with index options and futures accounting for 28% of trading volume versus 26.2% in the…

At this point, we will be happy to take questions. We ask that you please limit your questions to one per person to allow time to get to everyone. Feel free to get back in the queue and if time permits, we'll take a second question.

[Operator Instructions] The first question is from Rich Repetto of Sandler O'Neill. Richard H. Repetto - Sandler O'Neill + Partners, L.P., Research Division: I guess Bill, the first question is or the question is on volatility in the VIX, and you built the franchise on these products and they continue to grow. And I'm just trying to get an update on the customer segments and what's the run rate going forward. Where is the new growth coming from? And I'm going to apologize, but I got to sneak another one in. Can you comment on the night -- as an elder statesman in the exchange business, what can we do to prevent things and how is this going to impact, you think, trading going forward?

No, let me lead with the second question, although, I've learned a long time ago, you don't talk a lot about an issue if you don't have all the facts, and I don't have all the facts. But I would say that look, our understanding is that the SEC and [indiscernible] are reviewing what happened yesterday. We're obviously reluctant to get ahead of the regulators on this, but from the accounts that we've seen, it appears that there was a technology glitch in the trading algorithm. All markets have rules to address these types of situations and it appears that the rules were used uniformly, once the problem was made known. It's very hard to predict, so everything is going to happen here. This isn't even 24 hours old, so I really think that we ought to just let the facts come out and then see what happens. On the second question, on the volatility issue, we are extremely enthusiastic about the continued growth of VIX. It is very gratifying and it's really part of what we've been telling people all along, and that is that we spend a lot of time educating people. We see growth in various segments, we see growth from the individual customers side. We see tremendous growth on the professional and institutional side, as I mentioned in my remarks on the Tabb survey, and we're also seeing growth because of these exchange traded products, where quite frankly, that's the product that individuals and others can go to, to let the sponsor manage the volatility portfolio for them based on whatever they view as their volatility needs. So we are supporting all that and in fact, one of the main reasons we're doing our risk management conference literally 5 weeks from now, is that we want to bring our whole volatility suite of expertise to the European Community directly in the conference. I will be there. We are very enthusiastic based on the success of our risk management conferences that we've been having here for many years, but particularly in how we've been able to use that as a launching pad for VIX education, to bring that to the broader community.

The next question is from Howard Chen of Crédit Suisse. Howard Chen - Crédit Suisse AG, Research Division: Bill, you continue to execute well in both better and worse volume environments. I mean, you noted that the 8 straight quarters of earnings growth, but just on the environment, industry options, open interest levels are at or near the weakest levels since the financial crisis, what does that mean to you, if anything? And what's your level of concern that that's an indicator of weaker volume growth to come?

Howard, it's a fair question and I've been in this business a long time and there were periods where you have these dips and things come back. And it's very hard to predict when they'll come back. I can think of a year ago, July, when we thought things were really dreadfully slow and then all of a sudden, August shut the lights out. So it's hard to predict when the changes will occur. But it's never a straight line. Ed Tilly will support me on this in terms of some data that may be helpful to you.

Howard, just to point out, we do track open interest as just one of the many matrix that we use to follow volume, and open interest does ebb and flow. We can look quarter-over-quarter where open interest will decline only to return the next quarter. And just specifically for CBOE, a little difference for you if we look across our product line. Yes, the multi-list options open interest has declined June to July. It has declined from March to June. But for CBOE, a little different story if we look out into our index complex where open interest is pretty much unchanged between June and July and up actually, from March to June. And then for our futures complex, open interest continues to increase. So a little different CBOE look but we're not at all at this point alarmed at the open interest change month-over-month or quarter-over-quarter.

And the next question is from Alex Kramm of UBS.

Just wanted to quickly touch base on expenses. Alan, I think you left your guidance unchanged here. As I look at the current run rates, you're clearly still within the guidance, I mean on a year-to-date basis. If I just assumed the $45 million core, we would get to the high-end if we stay here, so maybe just talk to the trajectory. I mean, outside services were pretty high this quarter. You're still building out all this Secaucus stuff. So how is it going to flow through the remainder of the year?

If you take our core expenses for the 6 months ending June 30 and multiply it by 2 and annualize it, I think we're just under the low end of our annual guidance. However, as you noted if you take our expenses for the quarter and project a trend, the continued growth rate year-over-year, then we'll wind up somewhere in the middle of our annual guidance range that we provided during February and we reaffirmed today. So that's how we see expenses for the year and consequently, we are maintaining our expense guidance, and think we'll wind up somewhere in the middle of that range.

The next question is from Patrick O'Shaughnessy of Raymond James. Patrick J. O'Shaughnessy - Raymond James & Associates, Inc., Research Division: A question on your exchange service and other fees. I apologize if you already covered this, but your full year guidance, I believe is, you upped that to $27 million to $29 million. If that kind of run rate what you're doing first half of the year, that puts you over $30 million. So are you expecting some slowdown in that in the back half of the year?

Obviously, we were conservative in the guidance that we gave for this revenue line item last February for the guidance that we gave to you entire year. We were concerned about the pushback from our customers, and how they would respond to these free increases even though we believe the fee changes we made were competitive. We believe that VIP helped mitigate some of that pushback, our volume incentive program. And even with 2 quarters behind us, we're still a little concerned that we will experience some degradation as the year wears on. And so consequently, if you annualize results for this line item, using results for the first 6 months, it is somewhat higher as you noted, than the guidance we are providing but it's just our concern about the last 6 months of the year, given the changes that were made in this line item.

The next question is from Jillian Miller of BMO Capital Markets.

So you guys have launched a bunch of VIX-related products, I guess trying to leverage the success of the underlying franchise and I know this quarter, you mentioned that you had the NASDAQ-100 futures launch. It's hard kind of in outside looking in to gauge what all these launches have amounted to from a revenue perspective. So I was just wondering if you might be able to give us an a idea for, apart from the original VIX option and futures, how much do you earn from all these various VIX-related products you've listed over the past couple of years?

Certainly -- Jillian, this is Alan. Certainly, the VIX option in the future, that's what's the main driver of the increases in revenue, what we're seeing. And we have launched many products. They all start out as benchmarks and hopefully, they turn into products. There have been a couple of notable successes and the VIX emerging markets index is one that we're seeing some traction on and is starting to get my attention in terms of contributing to our top line. And we're also seeing licensing revenues starting to increase in our other revenue category. And it's almost getting to the point where I would give more granularity on that but not quite. But it's growing nicely, and so that's what I'm seeing from a P&L point of view. Ed or...

I can add a little bit to that, Jillian. I think the success of VIX and the satisfying the demand for VIX exposure, overall volatility exposure, is really being satisfied by the liquidity and the ability to cover volatility in the S&P 500. And we see even a global interest in exposure, in using the VIX product line of the S&P 500. So not surprisingly, any competing product to VIX, the S&P 500 VIX, really has some uphill fight, whether it's global or our own domestic products. So again, our line here is to educate, bring new products to answer a broader range of users' demand but we will continue to do just that.

[Operator Instructions]

I don't see any further questions. So with that, that completes our call this morning. We appreciate your time and continued interest in our company. Thank you.

Ladies and gentlemen, this concludes today's program. You may now disconnect. Good day.