82 FR 27920 - Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend BOX Rule 7240 (Complex Orders) To Expand the Price Range Within Which Complex Orders Can Trade
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 116 (June 19, 2017)
Federal Register Volume 82, Issue 116 (June 19, 2017)
| Page Range | 27920-27925 | |
| FR Document | 2017-12589 |
[Federal Register Volume 82, Number 116 (Monday, June 19, 2017)] [Notices] [Pages 27920-27925] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-12589] [[Page 27920]] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80917; File No. SR-BOX-2017-20] Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend BOX Rule 7240 (Complex Orders) To Expand the Price Range Within Which Complex Orders Can Trade June 13, 2017. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on June 2, 2017, BOX Options Exchange LLC (the ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b- 4(f)(6) thereunder.\4\ The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ 15 U.S.C. 78s(b)(3)(A)(iii). \4\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend BOX Rule 7240 (Complex Orders) to expand the price range within which Complex Orders can trade. The text of the proposed rule change is available from the principal office of the Exchange, at the Commission's Public Reference Room and also on the Exchange's Internet Web site at http://boxexchange.com. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend BOX Rule 7240 (Complex Orders) to expand the price range within which Complex Orders can trade by allowing the execution of Complex Order trades on BOX Market LLC (``BOX''), the options trading facility of the Exchange, at prices equal to or better than the Extended cNBBO, as described below. Background Currently, on BOX, all inbound Complex Orders are filtered to ensure that each leg of a Complex Order will be executed at a price that is equal to or better than the National Best Bid or Offer (``NBBO'') and the BOX Best Bid or Offer (``BOX BBO'') for each of the component series. Specifically, if an inbound Complex Order is executable (against either opposite side Complex Orders on the Complex Order Book or interest on the BOX Book) on BOX, BOX will determine if the potential execution price is equal to or better than both cNBBO \5\ and cBBO.\6\ If so, the inbound Complex Order will be executed to the extent possible according to the priority described in Rule 7240(b)(3). --------------------------------------------------------------------------- \5\ The term ``cNBBO'' means the best net bid and offer price for a Complex Order Strategy based on the NBBO for the individual options components of such Strategy. See Rule 7240(a)(3). \6\ The term ``cBBO'' means the best net bid and offer price for a Complex Order Strategy based on the BBO on the BOX Book for the individual options components of such Strategy. See Rule 7240(a)(1). --------------------------------------------------------------------------- Proposal The Exchange is now proposing that, with an inbound Complex Order on BOX, BOX will determine if the potential execution price is equal to or better than both Extended cNBBO, as described in greater detail below, and cBBO. If so, the inbound Complex Order will be executed to the extent possible according to the priority described in Rule 7240(b)(3). The Exchange notes that the Complex Order Filter was initially established to protect Participants from extreme or erroneous executions. \7\ In practice, however, BOX Participants have expressed that the existing Complex Order Filter is too restrictive and prevents executions that would be allowed to execute on competing exchanges. The expanded price range proposed below is designed to support a fair and orderly market addressing these concerns while continuing to mitigate the potential risk of executions at prices that are extreme or potentially erroneous. BOX will also continue to ensure that each leg of a Complex Order be executed at a price that is equal to or better than the BOX BBO for each of the component series but, as a result of the Extended cNBBO, BOX will no longer require that each leg of a Complex Order be executed at a price that is equal to or better than the NBBO.\8\ --------------------------------------------------------------------------- \7\ See Securities Exchange Act Release No. 69419 (April 19, 2013), 78 FR 24449 (April 25, 2013) (Order Approving SR-BOX-2013- 01). \8\ See proposed Rule 7240(b)(3)(iii). Complex Orders will continue to be execute [sic] in accordance with the priority rules in BOX Rule 7240(b)(2). --------------------------------------------------------------------------- Extended cNBBO The Extended cNBBO is the maximum net bid and offer execution price for a Complex Order Strategy.\9\ The Extended cNBBO is calculated by subtracting the Extended cNBBO Limit \10\ from the cNBB \11\ and adding the Extended cNBBO Limit to the cNBO.\12\ In calculating the Extended cNBBO, each side of the Extended cNBBO is rounded to the nearest penny within the Extended cNBBO (i.e. the cNBB is rounded up to the nearest penny and the cNBO is rounded down to the nearest penny). The Extended cNBBO Limit is a percentage or an amount, whichever provides the less restrictive range (i.e. the widest range) when calculating the Extended cNBBO. The Exchange is proposing to make the parameters configurable, with a minimum percentage of 3% and maximum percentage of 50%; and a minimum amount of $0.00 and maximum amount of $1.00. However, the default Extended cNBBO Limit for all classes will be 5% of the cNBB or cNBO as applicable or $0.05 whichever allows for the greater chance of execution. The default Extended cNBBO was determined based on industry standards and participant feedback. --------------------------------------------------------------------------- \9\ See proposed Rule 7240(a)(5). \10\ See proposed Rule 7240(a)(6). \11\ The term ``cNBB'' means the best net bid price for a Complex Order Strategy based on the NBBO for the individual options components of such Strategy. See Rule 7420(a)(2). \12\ The term ``cNBO'' means the best net offer price for a Complex Order Strategy based on the NBBO for the individual options components of such Strategy. See Rule 7240(a)(4). --------------------------------------------------------------------------- The Exchange believes the proposed price protection parameters are reasonable and appropriate. The proposed Extended cNBBO filter is comparable to the price protections that are currently in place on other exchanges. The Exchange's proposal is designed to provide flexibility in determining the acceptable execution range by allowing the acceptable [[Page 27921]] execution range to be calculated using either a percentage amount or a dollar amount.\13\ For example, by using a parameter that is a percentage of the cNBBO the Exchange is ensuring that the parameter accurately reflects the market for the Complex Order. However, this is not always an effective protection if the price of the order is relatively low because it results in a restrictive range as seen in Example 2 below.\14\ Instead, the BOX Trading Host will determine the ranges associated with both parameters and apply the least restrictive option. --------------------------------------------------------------------------- \13\ See e.g., Nasdaq OMX PHLX (``Phlx'') Rule 1098(h)(i) Acceptable Complex Execution Parameter and Chicago Board Options Exchange (``CBOE'') Rule 6.53C.08(e) Acceptable Range Parameter which both apply a percentage defined on an issue by issue basis; while MIAX Options Exchange (``MIAX'') Rule 518(c)(1)(iv) applies a specific dollar amount. \14\ MIAX discussed this concern when justifying its use of a dollar value parameter for its comparable complex order price protection. See Securities Exchange Act Release No. 80089 (February 22, 2017), 82 FR 12153 (February 28, 2017) (Notice of Filing and Immediate Effectiveness SR-MIAX-2017-06). --------------------------------------------------------------------------- The Exchange may modify, based on market conditions (for example, volatility) and Participant feedback, the Extended cNBBO Limit with prior notice to the Participants via Regulatory Circular, provided that the Exchange provides Participants with at least two weeks notice. Complex Order Filter Currently, on BOX, all inbound Complex Orders to BOX are filtered to ensure that each leg of a Complex Order will be executed at a price that is equal to or better than the NBBO and the BOX BBO for each component series. The Exchange proposes now to amend the cNBBO filter for the component series. Specifically, all inbound Complex Orders to BOX will be filtered to ensure that each leg of a Complex Order will be executed at a price that is equal to or better than the BOX BBO for each of the component series and the Extended cNBBO for the Complex Order Strategy. The execution, exposure and cancellation of Complex Orders being filtered on BOX pursuant to Rule 7240(b)(3)(iii) will remain unchanged from current operations except that the calculation of cNBBO will be replaced with the proposed Extended cNBBO, which provides a wider range to allow executions. The Exchange notes that amending the Complex Order Filter is a competitive change, and BOX believes that amending this feature will keep the Exchange in line with competing exchanges in the industry that have comparable price protections for complex orders. Implied Orders Currently, on BOX, an Implied Order is a Complex Order at the cNBBO, derived from the orders at the BBO on the BOX Book for each component leg of the Strategy, provided each component leg is at a price equal to the NBBO for that series. When an Implied Order is no longer at the cNBBO, the Implied Order will be removed and a new Implied Order will be generated, provided there is interest on the BOX Book to generate an Implied Order at the new cNBBO, provided each component leg is at a price equal to the NBBO for that series. The Exchange is now proposing that the generation of an Implied Order will not be limited only to the cNBBO. Specifically, the Exchange is proposing to generate an Implied Order at or within the Extended cNBBO, rather than the cNBBO derived from the orders at the BBO on the BOX Book for each component leg of the Strategy.\15\ In order to give effect to the new Extended cNBBO range, the Exchange will no longer require each component leg to be at a price equal to the NBBO for that series. --------------------------------------------------------------------------- \15\ See proposed Rule 7240(d). --------------------------------------------------------------------------- Examples The following examples illustrate the effect of the proposed change on execution of Complex Orders on BOX. Example 1 Prior to Proposed ChangecNBBO for A+B is 137.40-137.60 Order to sell 10 A+B at 144.00 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 144.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 17.00 10 ------------------------------------------------------------------------ Result: The incoming Complex Order is rejected because it would trade at a price (144.00) that is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53-144.48 (i.e., (137.40*.95)-(137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35-137.65 (i.e., (137.40-.05)-(137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53-144.48) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 144.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 17.00 10 ------------------------------------------------------------------------ Result: The incoming Complex Order is accepted because it would trade at a price (144.00) that is less than the maximum price range (144.48). The incoming Complex Order trades completely against the Complex Order to buy 10 at 144.00 on the Complex Order Book. Example 2 Prior to the Proposed Change cNBBO for A+B is .07-0.10 Order to sell 10 A+B at 0.12 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 0.12 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 0.30 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 0.30 10 ------------------------------------------------------------------------ Result: The incoming Complex Order is rejected because it would trade at a price (0.12) that is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 0.07-0.10 (i.e., (0.07*.95)-(0.10*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 0.02-0.15 (i.e., (0.07-.05)-(0.10 + .05)) Alternative B's calculation of the Extended cNBBO for A+B is used (0.02-0.15) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 0.12 ------------------------------------------------------------------------ [[Page 27922]] BOX Book Instrument A ------------------------------------------------------------------------ 0.30 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 0.30 10 ------------------------------------------------------------------------ Result: The incoming Complex Order is accepted because it trades at a price (0.12) that is less than the maximum price range (0.15). The incoming Complex Order trades completely against the Complex Order to buy 10 at 0.12 on the Complex Order Book. Example 3 Prior to the Proposed Change cNBBO for A+B is 137.40-137.60 Order to buy 10 A+B at 144.48 is received NBBO for A is 124.50-124.60 NBBO for B is 12.90-13.00 ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 16.48 10 ------------------------------------------------------------------------ Result: The incoming Complex Order is exposed by the system at 137.60 pursuant to Rule 7240 (b)(3)(iii)(B). If interest remains after the exposure, it will be posted to the Complex Order Book. If, however, the Participant submitting the Complex Order has elected not to have the Complex Order exposed, the Complex Order will be posted to the Complex Order Book or cancelled in accordance with the Participant's instructions. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53 - 144.48 (i.e., (137.40*.95) - (137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35 - 137.65 (i.e., (137.40-.05) - (137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53 - 144.48) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 16.48 10 ------------------------------------------------------------------------ Result: The incoming Complex Order trades at 144.48 against interest on the BOX Book for A and B, specifically against the order to sell 10 A at 128.00 and the order to sell 10 B at 16.48. Example 4 Prior to the Proposed Change cNBBO for A+B is 137.40 - 137.60 Market Order to buy 100 A+B ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 144.00 10 145.00 10 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 17.00 10 ------------------------------------------------------------------------ Result: The incoming Market Complex Order is exposed by the system at 137.60. If, however, the Participant submitting the Complex Order elected to not have the Complex Order be exposed, the Complex Order will be cancelled to avoid matching with the 10 A+B at 144 which is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53-144.48 (i.e., (137.40*.95) - (137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35-137.65 (i.e., (137.40 - .05) - (137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53-144.48) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 144.00 10 145.00 10 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 128.00 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 17.00 10 ------------------------------------------------------------------------ Result: The incoming Market Order to buy 100 first trades against the 10 A+B at 144.00 which is less than the maximum price range (144.48). The remaining 90 quantity of the Market Order is exposed at 144.48, unless the Participant submitting the Complex Order has elected not to have the Complex Order exposed. If interest remains after the exposure, it will be canceled to avoid matching with the 10 A+B at 145 which is outside the Extended cNBBO. Example 5 Prior to the Proposed Change cNBBO for A+2B is 150.30-153.70 Order to sell 10 A+2B at 161.38 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+2B ------------------------------------------------------------------------ 10 161.38 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 127.70 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 16.80 1 ------------------------------------------------------------------------ Result: The inbound Complex Order is rejected because it would trade at a price (161.38) outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+2B based on percentage is 142.79-161.38 (i.e., (150.30*.95) - (153.70*1.05)) Alternative B: The Extended cNBBO for A+2B based on amount is 150.25-153.75 (i.e., (150.30-.05) - (153.70 + .05)) Alternative A's calculation of the Extended cNBBO for A+2B is used (142.79-161.38) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+2B ------------------------------------------------------------------------ 10 161.38 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ 10 120.00 127.70 10 ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ 10 11.00 16.80 1 ------------------------------------------------------------------------ [[Page 27923]] Result: The incoming Complex Order is at the calculated Extended cNBBO (161.38) and therefore is accepted. The incoming Complex Order trades against the resting Complex Order to buy A+2B at 161.38. Example 6 Prior to the Proposed Change cNBBO for A+B is 137.40-137.60 Order to sell 10 A+B at 142.48 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 150.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order is rejected because it would trade at a price (142.48) that is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53-144.48 (i.e., (137.40*.95) - (137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35-137.65 (i.e., (137.40-.05) - (137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53-144.48) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 150.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order trades against the resting Complex Order. Specifically, the incoming Complex Order executes against the resting Complex Order at 144.48 which is equal to the Extended cNBBO (144.48). Example 7 Prior to the Proposed Change cNBBO for A+B is 137.40 - 137.60 Order to sell 10 A+B at 145.00 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 150.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order is rejected because it would trade at a price (145.00) that is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53 - 144.48 (i.e., (137.40*.95) - (137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35 - 137.65 (i.e., (137.40-.05) - (137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53 - 144.48) BOX Book for Complex Order A+B ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ 10 150.00 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order is rejected because it would trade against the resting Complex Order at a price (145.00) outside the Extended cNBBO (144.48). Example 8 Prior to the Proposed Change cNBBO for A+B is 137.40-137.60 Order to sell 100 A+B at 130.40 is received ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 130.60 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order would be exposed by the system at 137.40. If the Participant submitting the Complex Order has elected to not have the Complex Order exposed, the Complex Order will be cancelled. If interest remains after the exposure, it will be canceled to avoid matching with the 10 A+B at 130.60 which is outside the cNBBO. After the Proposed Change Alternative A: The Extended cNBBO for A+B based on percentage is 130.53 - 144.48 (i.e., (137.40*.95) - (137.60*1.05)) Alternative B: The Extended cNBBO for A+B based on amount is 137.35-137.65 (i.e., (137.40 - .05) - (137.60 + .05)) Alternative A's calculation of the Extended cNBBO for A+B is used (130.53 - 144.58) ------------------------------------------------------------------------ Quantity Buy Sell Quantity ------------------------------------------------------------------------ BOX Book for Complex Order A+B ------------------------------------------------------------------------ 10 130.60 ------------------------------------------------------------------------ BOX Book Instrument A ------------------------------------------------------------------------ ------------------------------------------------------------------------ BOX Book Instrument B ------------------------------------------------------------------------ ------------------------------------------------------------------------ Result: The incoming Complex Order first trades against the resting Complex Order for 10 at 130.60 and then the remaining quantity is exposed. Specifically, the remaining 90 A+B is exposed at the Extended cNBBO (130.53). Any remaining quantity that is not executed at the end of the exposure period will be posted to the Complex Order Book. 2. Statutory Basis The Exchange believes that the proposal is consistent with the requirements of Section 6(b) of the Securities Exchange Act of 1934 (the ``Act''),\16\ in general, and Section 6(b)(5) [[Page 27924]] of the Act,\17\ in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general to protect investors and the public interest. In particular, the Exchange proposes to allow Complex Orders to be executed on BOX in a wider range of prices, which will permit additional executions. As is apparent from the examples included in the description of purpose above, a number of Complex Order executions that would otherwise be made between willing buyers and sellers on BOX, but which are now rejected under the Exchange's current rules, will be allowed to execute under this proposed rule change. --------------------------------------------------------------------------- \16\ 15 U.S.C. 78f(b). \17\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes the proposal is an improvement over its current rules regarding Complex Orders and will benefit all market participants submitting Complex Order [sic] to BOX. As discussed above, the Exchange found that in practice, the current Complex Order Filter is too restrictive and prevents executions that Participants would otherwise want. The Exchange believes that the proposed change is designed to support a fair and orderly market by addressing the concerns expressed by BOX Participants, while continuing to mitigate the potential risk of executions at prices that are extreme or potentially erroneous. The Exchange believes that this rule filing is reasonable, equitable and not unfairly discriminatory to customers and Participants because, other than the expanded execution range represented by the Extended cNBBO, it follows the existing mechanics of the Exchange's existing Complex Order filter mechanism and the Exchange's existing Complex Order priority rules, each of which has previously been approved by the Commission. The Exchange further believes the proposal is not unfairly discriminatory because the benefits of the proposal on BOX are equally available to all Participants. The Exchange believes this proposal will increase opportunities for execution of Complex Orders and orders on the BOX Book. Further, the Exchange believes the proposed Extended cNBBO will provide greater flexibility to Participants trading Complex Orders on BOX. The Exchange also believes the proposal will provide additional opportunities for Participants to achieve better handling of Complex Orders and result in increased opportunities for execution. As a result, adopting this proposal to allow executions of Complex Orders within the Extended cNBBO will promote just and equitable principles of trade, foster cooperation and coordination with persons engaged in facilitating transactions in securities, and remove impediments to and perfect the mechanism of a free and open market and a national market system. For the foregoing reasons, the Exchange believes this proposal is a reasonable modification to its rules, designed to facilitate increased interaction of Complex Orders on BOX, and to do so in a manner that maximizes opportunities for trade executions for Complex Orders. The Exchange believes it is appropriate and consistent with the Act to adopt the proposed rule changes. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. Implementation of the proposed rule change will foster additional executions and enable greater competition among other competing exchanges that have comparable complex order filter provisions for the reasons set forth above. Further, the Exchange does not believe the proposed change will impose a burden on intramarket competition as the proposed change will affect all Participants equally. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action (a) This proposed rule change is filed pursuant to paragraph (A) of section 19(b)(3) of the Exchange Act \18\ and Rule 19b-4(f)(6) thereunder.\19\ --------------------------------------------------------------------------- \18\ 15 U.S.C. 78s(b)(3)(A). \19\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- (b) This proposed rule change does not significantly affect the protection of investors or the public interest, does not impose any significant burden on competition, and, by its terms, does not become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest.\20\ --------------------------------------------------------------------------- \20\ As required under Rule 19b-4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. --------------------------------------------------------------------------- At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-BOX-2017-20 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-BOX-2017-20. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public [[Page 27925]] Reference Room, 100 F Street NE., Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-BOX-2017-20, and should be submitted on or before July 10, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\21\ --------------------------------------------------------------------------- \21\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-12589 Filed 6-16-17; 8:45 am] BILLING CODE 8011-01-P
![27920 Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices
SECURITIES AND EXCHANGE A. Self-Regulatory Organization’s addressing these concerns while
COMMISSION Statement of the Purpose of, and the continuing to mitigate the potential risk
Statutory Basis for, the Proposed Rule of executions at prices that are extreme
[Release No. 34–80917; File No. SR–BOX– Change or potentially erroneous. BOX will also
2017–20] continue to ensure that each leg of a
1. Purpose
Complex Order be executed at a price
Self-Regulatory Organizations; BOX The Exchange proposes to amend that is equal to or better than the BOX
Options Exchange LLC; Notice of BOX Rule 7240 (Complex Orders) to BBO for each of the component series
Filing and Immediate Effectiveness of expand the price range within which but, as a result of the Extended cNBBO,
Proposed Rule Change To Amend BOX Complex Orders can trade by allowing BOX will no longer require that each leg
Rule 7240 (Complex Orders) To the execution of Complex Order trades of a Complex Order be executed at a
Expand the Price Range Within Which on BOX Market LLC (‘‘BOX’’), the price that is equal to or better than the
Complex Orders Can Trade options trading facility of the Exchange, NBBO.8
at prices equal to or better than the
June 13, 2017. Extended cNBBO, as described below. Extended cNBBO
Pursuant to Section 19(b)(1) of the The Extended cNBBO is the
Background
Securities Exchange Act of 1934 maximum net bid and offer execution
Currently, on BOX, all inbound price for a Complex Order Strategy.9
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
Complex Orders are filtered to ensure The Extended cNBBO is calculated by
notice is hereby given that on June 2, that each leg of a Complex Order will
2017, BOX Options Exchange LLC (the subtracting the Extended cNBBO
be executed at a price that is equal to Limit 10 from the cNBB 11 and adding
‘‘Exchange’’) filed with the Securities or better than the National Best Bid or
and Exchange Commission the Extended cNBBO Limit to the
Offer (‘‘NBBO’’) and the BOX Best Bid cNBO.12 In calculating the Extended
(‘‘Commission’’) the proposed rule or Offer (‘‘BOX BBO’’) for each of the
change as described in Items I and II cNBBO, each side of the Extended
component series. Specifically, if an cNBBO is rounded to the nearest penny
below, which Items have been prepared inbound Complex Order is executable
by the Exchange. The Exchange filed the within the Extended cNBBO (i.e. the
(against either opposite side Complex cNBB is rounded up to the nearest
proposed rule change pursuant to Orders on the Complex Order Book or penny and the cNBO is rounded down
Section 19(b)(3)(A)(iii) of the Act 3 and interest on the BOX Book) on BOX, BOX to the nearest penny). The Extended
Rule 19b–4(f)(6) thereunder.4 The will determine if the potential execution cNBBO Limit is a percentage or an
Commission is publishing this notice to price is equal to or better than both amount, whichever provides the less
solicit comments on the proposed rule cNBBO 5 and cBBO.6 If so, the inbound restrictive range (i.e. the widest range)
change from interested persons. Complex Order will be executed to the when calculating the Extended cNBBO.
I. Self-Regulatory Organization’s extent possible according to the priority The Exchange is proposing to make the
Statement of the Terms of Substance of described in Rule 7240(b)(3). parameters configurable, with a
the Proposed Rule Change Proposal minimum percentage of 3% and
maximum percentage of 50%; and a
The Exchange proposes to amend The Exchange is now proposing that, minimum amount of $0.00 and
BOX Rule 7240 (Complex Orders) to with an inbound Complex Order on maximum amount of $1.00. However,
expand the price range within which BOX, BOX will determine if the the default Extended cNBBO Limit for
Complex Orders can trade. The text of potential execution price is equal to or all classes will be 5% of the cNBB or
the proposed rule change is available better than both Extended cNBBO, as cNBO as applicable or $0.05 whichever
from the principal office of the described in greater detail below, and allows for the greater chance of
Exchange, at the Commission’s Public cBBO. If so, the inbound Complex Order execution. The default Extended cNBBO
Reference Room and also on the will be executed to the extent possible was determined based on industry
Exchange’s Internet Web site at http:// according to the priority described in standards and participant feedback.
boxexchange.com. Rule 7240(b)(3). The Exchange notes The Exchange believes the proposed
that the Complex Order Filter was price protection parameters are
II. Self-Regulatory Organization’s
initially established to protect reasonable and appropriate. The
Statement of the Purpose of, and
Participants from extreme or erroneous proposed Extended cNBBO filter is
Statutory Basis for, the Proposed Rule
executions. 7 In practice, however, BOX comparable to the price protections that
Change
Participants have expressed that the are currently in place on other
In its filing with the Commission, the existing Complex Order Filter is too exchanges. The Exchange’s proposal is
self-regulatory organization included restrictive and prevents executions that designed to provide flexibility in
statements concerning the purpose of, would be allowed to execute on determining the acceptable execution
and basis for, the proposed rule change competing exchanges. The expanded range by allowing the acceptable
and discussed any comments it received price range proposed below is designed
on the proposed rule change. The text to support a fair and orderly market 8 See proposed Rule 7240(b)(3)(iii). Complex
of these statements may be examined at Orders will continue to be execute [sic] in
5 The term ‘‘cNBBO’’ means the best net bid and accordance with the priority rules in BOX Rule
the places specified in Item IV below. 7240(b)(2).
offer price for a Complex Order Strategy based on
asabaliauskas on DSKBBXCHB2PROD with NOTICES
The self-regulatory organization has the NBBO for the individual options components of 9 See proposed Rule 7240(a)(5).
prepared summaries, set forth in such Strategy. See Rule 7240(a)(3). 10 See proposed Rule 7240(a)(6).
Sections A, B, and C below, of the most 6 The term ‘‘cBBO’’ means the best net bid and 11 The term ‘‘cNBB’’ means the best net bid price
significant aspects of such statements. offer price for a Complex Order Strategy based on for a Complex Order Strategy based on the NBBO
the BBO on the BOX Book for the individual for the individual options components of such
options components of such Strategy. See Rule Strategy. See Rule 7420(a)(2).
1 15 U.S.C. 78s(b)(1). 7240(a)(1). 12 The term ‘‘cNBO’’ means the best net offer
2 17 CFR 240.19b–4. 7 See Securities Exchange Act Release No. 69419 price for a Complex Order Strategy based on the
3 15 U.S.C. 78s(b)(3)(A)(iii).
(April 19, 2013), 78 FR 24449 (April 25, 2013) NBBO for the individual options components of
4 17 CFR 240.19b–4(f)(6). (Order Approving SR–BOX–2013–01). such Strategy. See Rule 7240(a)(4).
VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 PO 00000 Frm 00139 Fmt 4703 Sfmt 4703 E:\FR\FM\19JNN1.SGM 19JNN1](https://thefederalregister.org/doc/82_FR_28036/page/1.svg)
![27924 Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices
of the Act,17 in particular, in that it is opportunities for Participants to achieve consistent with the protection of
designed to prevent fraudulent and better handling of Complex Orders and investors and the public interest.20
manipulative acts and practices, to result in increased opportunities for At any time within 60 days of the
promote just and equitable principles of execution. As a result, adopting this filing of the proposed rule change, the
trade, to foster cooperation and proposal to allow executions of Commission summarily may
coordination with persons engaged in Complex Orders within the Extended temporarily suspend such rule change if
facilitating transactions in securities, to cNBBO will promote just and equitable it appears to the Commission that such
remove impediments to and perfect the principles of trade, foster cooperation action is necessary or appropriate in the
mechanism of a free and open market and coordination with persons engaged public interest, for the protection of
and a national market system, and, in in facilitating transactions in securities, investors, or otherwise in furtherance of
general to protect investors and the and remove impediments to and perfect the purposes of the Act. If the
public interest. In particular, the the mechanism of a free and open Commission takes such action, the
Exchange proposes to allow Complex market and a national market system. Commission shall institute proceedings
Orders to be executed on BOX in a For the foregoing reasons, the to determine whether the proposed rule
wider range of prices, which will permit Exchange believes this proposal is a should be approved or disapproved.
additional executions. As is apparent reasonable modification to its rules,
from the examples included in the IV. Solicitation of Comments
designed to facilitate increased
description of purpose above, a number interaction of Complex Orders on BOX, Interested persons are invited to
of Complex Order executions that and to do so in a manner that maximizes submit written data, views, and
would otherwise be made between opportunities for trade executions for arguments concerning the foregoing,
willing buyers and sellers on BOX, but Complex Orders. The Exchange believes including whether the proposed rule
which are now rejected under the it is appropriate and consistent with the change is consistent with the Act.
Exchange’s current rules, will be Act to adopt the proposed rule changes. Comments may be submitted by any of
allowed to execute under this proposed the following methods:
rule change. B. Self-Regulatory Organization’s
The Exchange believes the proposal is Statement on Burden on Competition Electronic Comments
an improvement over its current rules The Exchange does not believe that • Use the Commission’s Internet
regarding Complex Orders and will the proposed rule change will impose comment form (http://www.sec.gov/
benefit all market participants any burden on competition not rules/sro.shtml); or
submitting Complex Order [sic] to BOX. necessary or appropriate in furtherance • Send an email to rule-comments@
As discussed above, the Exchange found of the purposes of the Act. sec.gov. Please include File Number SR–
that in practice, the current Complex Implementation of the proposed rule BOX–2017–20 on the subject line.
Order Filter is too restrictive and change will foster additional executions Paper Comments
prevents executions that Participants and enable greater competition among
would otherwise want. The Exchange other competing exchanges that have • Send paper comments in triplicate
believes that the proposed change is comparable complex order filter to Brent J. Fields, Secretary, Securities
designed to support a fair and orderly provisions for the reasons set forth and Exchange Commission, 100 F Street
market by addressing the concerns above. Further, the Exchange does not NE., Washington, DC 20549–1090.
expressed by BOX Participants, while believe the proposed change will All submissions should refer to File
continuing to mitigate the potential risk impose a burden on intramarket Number SR–BOX–2017–20. This file
of executions at prices that are extreme competition as the proposed change will number should be included on the
or potentially erroneous. The Exchange affect all Participants equally. subject line if email is used. To help the
believes that this rule filing is Commission process and review your
reasonable, equitable and not unfairly C. Self-Regulatory Organization’s comments more efficiently, please use
discriminatory to customers and Statement on Comments on the only one method. The Commission will
Participants because, other than the Proposed Rule Change Received From post all comments on the Commission’s
expanded execution range represented Members, Participants, or Others Internet Web site (http://www.sec.gov/
by the Extended cNBBO, it follows the The Exchange has neither solicited rules/sro.shtml). Copies of the
existing mechanics of the Exchange’s nor received comments on the proposed submission, all subsequent
existing Complex Order filter rule change. amendments, all written statements
mechanism and the Exchange’s existing with respect to the proposed rule
Complex Order priority rules, each of III. Date of Effectiveness of the
Proposed Rule Change and Timing for change that are filed with the
which has previously been approved by Commission, and all written
the Commission. The Exchange further Commission Action
communications relating to the
believes the proposal is not unfairly (a) This proposed rule change is filed proposed rule change between the
discriminatory because the benefits of pursuant to paragraph (A) of section Commission and any person, other than
the proposal on BOX are equally 19(b)(3) of the Exchange Act 18 and Rule those that may be withheld from the
available to all Participants. 19b–4(f)(6) thereunder.19 public in accordance with the
The Exchange believes this proposal (b) This proposed rule change does provisions of 5 U.S.C. 552, will be
will increase opportunities for not significantly affect the protection of available for Web site viewing and
asabaliauskas on DSKBBXCHB2PROD with NOTICES
execution of Complex Orders and orders investors or the public interest, does not printing in the Commission’s Public
on the BOX Book. Further, the Exchange impose any significant burden on
believes the proposed Extended cNBBO competition, and, by its terms, does not 20 As required under Rule 19b–4(f)(6)(iii), the
will provide greater flexibility to become operative for 30 days after the Exchange provided the Commission with written
Participants trading Complex Orders on date of the filing, or such shorter time notice of its intent to file the proposed rule change,
BOX. The Exchange also believes the along with a brief description and the text of the
as the Commission may designate if proposed rule change, at least five business days
proposal will provide additional prior to the date of filing of the proposed rule
18 15 U.S.C. 78s(b)(3)(A). change, or such shorter time as designated by the
17 15 U.S.C. 78f(b)(5). 19 17 CFR 240.19b–4(f)(6). Commission.
VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 PO 00000 Frm 00143 Fmt 4703 Sfmt 4703 E:\FR\FM\19JNN1.SGM 19JNN1](https://thefederalregister.org/doc/82_FR_28036/page/5.svg)
![Federal Register / Vol. 82, No. 116 / Monday, June 19, 2017 / Notices 27925
Reference Room, 100 F Street NE., managed exchange-traded funds for ETF (each, a ‘‘Fund’’ and, collectively,
Washington, DC 20549 on official which the portfolio is disclosed in the ‘‘Funds’’).
business days between the hours of accordance with standard mutual fund
Proposed Listing Rules
10:00 a.m. and 3:00 p.m. Copies of such disclosure rules. In addition, the
filing also will be available for Exchange proposes to list and trade Proposed Rule 14.11(k)(1) provides
inspection and copying at the principal shares of the following under proposed that the Exchange will consider for
office of the Exchange. All comments Rule 14.11(k): ClearBridge Appreciation trading, whether by listing or pursuant
received will be posted without change; ETF; ClearBridge Large Cap ETF; to UTP, Managed Portfolio Shares that
the Commission does not edit personal ClearBridge MidCap Growth ETF; meet the criteria of Rule 14.11(k).
identifying information from ClearBridge Select ETF; and ClearBridge Proposed Rule 14.11(k)(2) provides
submissions. You should submit only All Cap Value ETF. that Rule 14.11(k) is applicable only to
information that you wish to make Managed Portfolio Shares and that,
The text of the proposed rule change except to the extent inconsistent with
available publicly. All submissions is available at the Exchange’s Web site
should refer to File Number SR–BOX– Rule 14.11(k), or unless the context
at www.bats.com, at the principal office otherwise requires, the rules and
2017–20, and should be submitted on or of the Exchange, and at the
before July 10, 2017. procedures of the Exchange’s Board of
Commission’s Public Reference Room. Directors shall be applicable to the
For the Commission, by the Division of
Trading and Markets, pursuant to delegated II. Self-Regulatory Organization’s trading on the Exchange of such
authority.21 Statement of the Purpose of, and securities. Proposed Rule 14.11(k)(2)
Eduardo A. Aleman, Statutory Basis for, the Proposed Rule provides further that Managed Portfolio
Change Shares are included within the
Assistant Secretary.
definition of ‘‘security’’ or ‘‘securities’’
[FR Doc. 2017–12589 Filed 6–16–17; 8:45 am] In its filing with the Commission, the as such terms are used in the Rules of
BILLING CODE 8011–01–P Exchange included statements the Exchange.
concerning the purpose of and basis for Proposed Rule 14.11(k)(2)(A) provides
the proposed rule change and discussed that the Exchange will file separate
SECURITIES AND EXCHANGE any comments it received on the proposals under Section 19(b) of the Act
COMMISSION proposed rule change. The text of these before the listing and trading of
[Release No. 34–80911; File No. SR– statements may be examined at the Managed Portfolio Shares. All
BatsBZX–2017–30] places specified in Item IV below. The statements or representations contained
Exchange has prepared summaries, set in such rule filing regarding (a) the
Self-Regulatory Organizations; Bats forth in Sections A, B, and C below, of description of the portfolio or reference
BZX Exchange, Inc.; Notice of Filing of the most significant parts of such asset, (b) limitations on portfolio
a Proposed Rule Change To Permit the statements. holdings or reference assets, or (c) the
Listing and Trading of Managed applicability of Exchange listing rules
Portfolio Shares; and To List and (A) Self-Regulatory Organization’s
specified in such rule filing will
Trade Shares of the Following Under Statement of the Purpose of, and
constitute continued listing
Proposed Rule 14.11(k): ClearBridge Statutory Basis for, the Proposed Rule
requirements. An issuer of such
Appreciation ETF; ClearBridge Large Change
securities must notify the Exchange of
Cap ETF; ClearBridge MidCap Growth 1. Purpose any failure to comply with such
ETF; ClearBridge Select ETF; and continued listing requirements.
ClearBridge All Cap Value ETF The Exchange proposes to add new Proposed Rule 14.11(k)(2)(B) provides
Rule 14.11(k) for the purpose of that transactions in Managed Portfolio
June 13, 2017. permitting the listing and trading, or Shares will occur only during Regular
Pursuant to Section 19(b)(1) of the trading pursuant to unlisted trading Trading Hours.4
Securities Exchange Act of 1934 (the privileges (‘‘UTP’’), of Managed Proposed Rule 14.11(k)(2)(C) provides
‘‘Act’’),1 and Rule 19b–4 thereunder,2 Portfolio Shares, which are securities that the Exchange will implement
notice is hereby given that on June 1, issued by an actively managed open-end written surveillance procedures for
2017, Bats BZX Exchange, Inc. (the investment management company.3 In Managed Portfolio Shares.
‘‘Exchange’’ or ‘‘BZX’’) filed with the addition, the Exchange proposes to list Proposed Rule 14.11(k)(2)(D) provides
Securities and Exchange Commission and trade shares (‘‘Shares’’) of the that Authorized Participants (as defined
(‘‘Commission’’) the proposed rule following under proposed Rule 14.11(k): in the Investment Company’s Form N–
change as described in Items I and II ClearBridge Appreciation ETF; 1A filed with the SEC) redeeming
below, which Items have been prepared ClearBridge Large Cap ETF; ClearBridge Managed Portfolio Shares will sign an
by the Exchange. The Commission is MidCap Growth ETF; ClearBridge Select agreement with an agent (‘‘Trusted
publishing this notice to solicit ETF; and ClearBridge All Cap Value Agent’’) to establish a confidential
comments on the proposed rule change account for the benefit of such
from interested persons. 3 A Managed Portfolio Share is a security that Authorized Participant that will receive
I. Self-Regulatory Organization’s represents an interest in an investment company all consideration from the issuer in a
registered under the Investment Company Act of redemption. A Trusted Agent may not
Statement of the Terms of Substance of 1940 (15 U.S.C. 80a–1) (‘‘1940 Act’’) organized as
the Proposed Rule Change disclose the consideration received in a
asabaliauskas on DSKBBXCHB2PROD with NOTICES
an open-end investment company or similar entity
that invests in a portfolio of securities selected by redemption except as required by law or
The Exchange is proposing to adopt its investment adviser consistent with its as provided in the Investment
new Rule 14.11(k) to permit the listing investment objectives and policies. In contrast, an Company’s Form N–1A, as applicable.
and trading of Managed Portfolio open-end investment company that issues Index
Proposed Rule 14.11(k)(2)(E) provides
Shares, which are shares of actively Fund Shares, listed and traded on the Exchange
under Rule 14.11(c) (‘‘Index ETFs’’), seeks to that, if the investment adviser to the
provide investment results that correspond
21 17 CFR 200.30–3(a)(12). generally to the price and yield performance of a 4 As defined in Rule 1.5(w), the term ‘‘Regular
1 15 U.S.C. 78s(b)(1). specific foreign or domestic stock index, fixed Trading Hours’’ means the time between 9:30 a.m.
2 17 CFR 240.19b–4. income securities index or combination thereof. and 4:00 p.m. Eastern Time.
VerDate Sep<11>2014 17:09 Jun 16, 2017 Jkt 241001 PO 00000 Frm 00144 Fmt 4703 Sfmt 4703 E:\FR\FM\19JNN1.SGM 19JNN1](https://thefederalregister.org/doc/82_FR_28036/page/6.svg)
Document Created: 2017-06-17 01:48:18
Document Modified: 2017-06-17 01:48:18
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 82 FR 27920 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR