83 FR 5470 - Self-Regulatory Organizations; Nasdaq ISE, LLC; Order Approving a Proposed Rule Change To Establish a Nonstandard Expirations Pilot Program
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 26 (February 7, 2018)
Federal Register Volume 83, Issue 26 (February 7, 2018)
| Page Range | 5470-5473 | |
| FR Document | 2018-02394 |
[Federal Register Volume 83, Number 26 (Wednesday, February 7, 2018)] [Notices] [Pages 5470-5473] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-02394] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82612; File No. SR-ISE-2017-111] Self-Regulatory Organizations; Nasdaq ISE, LLC; Order Approving a Proposed Rule Change To Establish a Nonstandard Expirations Pilot Program February 1, 2018. I. Introduction On December 21, 2017, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with the Securities and Exchange Commission (``Commission'' or ``SEC''), pursuant to Section 19(b)(1) of the [[Page 5471]] Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to establish a Nonstandard Expirations Pilot Program. The proposed rule change was published for comment in the Federal Register on January 12, 2018.\3\ The Commission received no comments on the proposed rule change. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ See Securities Exchange Act Release No. 82458 (Jan. 8, 2018), 83 FR 1636. --------------------------------------------------------------------------- This order approves the proposal for a pilot period of twelve months. II. Description of the Proposal The Exchange proposes to permit the listing and trading, on a pilot basis, of p.m.-settled options on broad-based indexes with nonstandard expiration dates for a period of twelve months (the ``Nonstandard Expirations Pilot Program'' or ``Pilot Program'') from the date of approval of this proposed rule change. The Pilot Program would permit both weekly expirations (``Weekly Expirations'') and end of month (``EOM'') expirations similar to those of the a.m.-settled broad-based index options, except that the exercise settlement value will be based on the index value derived from the closing prices of component stocks. The proposal is substantially similar to Chicago Board Options Exchange (``CBOE'') Rule 24.9(e), Nonstandard Expirations Pilot Program \4\ as well as the Nonstandard Expirations Pilot Program of the Exchange's affiliate Nasdaq PHLX LLC (``Phlx'') Rule 1101A.\5\ --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release Nos. 78531 (August 10, 2016), 81 FR 54643 (August 16, 2016) (SR-CBOE-2016-046) (Order approving expansion of CBOE's Nonstandard Expirations Pilot Program to include Monday Expirations); 76909 (January 14, 2016), 81 FR 3512 (January 21, 2016) (SR-CBOE-2015-106) (Order approving expansion of CBOE's Nonstandard Expirations Pilot Program to include Wednesday Expirations); 62911 (September 14, 2010), 75 FR 57539 (September 21, 2010) (SR-CBOE-2009-075) (Order approving CBOE's Nonstandard Expirations Pilot Program). \5\ See Securities Exchange Act Release No. 82341 (December 15, 2017), 82 FR 60651 (December 21, 2017) (Order approving Phlx's Nonstandard Expirations Pilot Program). --------------------------------------------------------------------------- A. Weekly Expirations The Exchange proposes to add new Supplementary Material .07(a), Weekly Expirations, to Rule 2009. Under the proposed new rule the Exchange would be permitted to open for trading Weekly Expirations on any broad-based index eligible for standard options trading to expire on any Monday, Wednesday, or Friday (other than the third Friday-of- the-month or days that coincide with an EOM expiration). Weekly Expirations would be subject to all provisions of ISE Rule 2009 and would be treated the same as options on the same underlying index that expire on the third Friday of the expiration month. Unlike the standard monthly options, however, Weekly Expirations would be p.m.-settled. New series in Weekly Expirations could be added up to and including on the expiration date for an expiring Weekly Expiration. The maximum number of expirations that could be listed for each Weekly Expiration (i.e., a Monday expiration, Wednesday expiration, or Friday expiration, as applicable) in a given class would be the same as the maximum number of expirations permitted for standard options on the same broad-based index. Weekly Expirations would not need to be for consecutive Monday, Wednesday, or Friday expirations as applicable. However, the expiration date of a non-consecutive expiration would not be permitted beyond what would be considered the last expiration date if the maximum number of expirations were listed consecutively. Weekly Expirations that are first listed in a given class could expire up to four weeks from the actual listing date. If the last trading day of a month were a Monday, Wednesday, or Friday and the Exchange were to list EOMs and Weekly Expirations as applicable in a given class, the Exchange would list an EOM instead of a Weekly Expiration in the given class. Other expirations in the same class would not be counted as part of the maximum number of Weekly Expirations for a broad-based index class. If the Exchange were not open for business on a respective Monday, the normally Monday expiring Weekly Expirations would expire on the following business day. If the Exchange were not open for business on a respective Wednesday or Friday, the normally Wednesday or Friday expiring Weekly Expirations would expire on the previous business day. B. EOM Expirations Under the proposal, the Exchange could open for trading EOMs on any broad-based index eligible for standard options trading to expire on the last trading day of the month. EOMs would be subject to all provisions of Rule 2009 and treated the same as options on the same underlying index that expire on the third Friday of the expiration month. However, the EOMs would be p.m.-settled and new series in EOMs could be added up to and including on the expiration date for an expiring EOM. The maximum number of expirations that could be listed for EOMs in a given class would be the same as the maximum number of expirations permitted for standard options on the same broad-based index. EOM expirations would not need to be for consecutive end of month expirations. However, the expiration date of a non-consecutive expiration may not be beyond what would be considered the last expiration date if the maximum number of expirations were listed consecutively. EOMs that are first listed in a given class could expire up to four weeks from the actual listing date. Other expirations would not be counted as part of the maximum numbers of EOM expirations for a broad-based index class. C. Contract Terms and Trading Rules The Exchange proposes that Weekly Expirations and EOMs would be subject to the same rules that currently govern the trading of standard monthly broad-based index options, including sales practice rules, margin requirements, and floor trading procedures. Contract terms for Weekly Expirations and EOMs would be the same as those for standard monthly broad-based index options, except that the exercise settlement value will be based on the index value derived from the closing prices of component stocks. Since Weekly Expirations and EOMs will be a new type of series, and not a new class, the Exchange proposes that Weekly Expirations and EOMs shall be aggregated for any applicable reporting and other requirements.\6\ Pursuant to proposed Supplementary Material .07(d) of Rule 2009, transactions in Weekly Expirations and EOMs could be effected on the Exchange between the hours of 9:30 a.m. (Eastern Time) and 4:15 p.m. (Eastern Time). --------------------------------------------------------------------------- \6\ See Rule 2006(a)(13) which sets forth the reporting requirements for certain market indexes that do not have position limits, including NDX. The Exchange is adding Nonstandard Expirations to Rule 2004(d) to reflect the aggregation requirement. The Exchange notes that the proposed aggregation is consistent with the aggregation requirements for other types of option series (e.g. quarterly expiring options) that are listed on the Exchange and which do not expire on the customary ``third Friday''. --------------------------------------------------------------------------- The Exchange represents that it has analyzed its capacity and believes that it and the Options Price Reporting Authority have the necessary systems capacity to handle any additional traffic associated with the listing of the maximum number nonstandard expirations permitted under the Pilot Program. D. Pilot Program Annual Report As part of the Pilot Program, the Exchange proposes to submit a Pilot Program report to the Commission at [[Page 5472]] least two months prior to the expiration date of the Pilot Program (the ``annual report''). The annual report will contain an analysis of volume, open interest and trading patterns. In addition, for series that exceed certain minimum open interest parameters, the annual report will provide analysis of index price volatility and, if needed, share trading activity. The annual report will be provided to the Commission on a confidential basis. Analysis of Volume and Open Interest For all Weekly Expirations and EOM series, the annual report will contain the following volume and open interest data for each broad- based index overlying Weekly Expiration and EOM options: (1) Monthly volume aggregated for all Weekly Expiration and EOM series, (2) Volume in Weekly Expiration and EOM series aggregated by expiration date, (3) Month-end open interest aggregated for all Weekly Expiration and EOM series, (4) Month-end open interest for EOM series aggregated by expiration date and open interest for Weekly Expiration series aggregated by expiration date, (5) Ratio of monthly aggregate volume in Weekly Expiration and EOM series to total monthly class volume, and (6) Ratio of month-end open interest in EOM series to total month- end class open interest and ratio of open interest in each Weekly Expiration series to total class open interest. In addition, the annual report will contain the information noted above for standard Expiration Friday, a.m.-settled series, if applicable, for the period covered in the annual report as well as for the six-month period prior to the initiation of the Pilot Program. Upon request by the SEC, the Exchange will provide a data file containing: (1) Weekly Expiration and EOM option volume data aggregated by series, and (2) Weekly Expiration open interest for each expiring series and EOM month-end open interest for expiring series. Monthly Analysis of Weekly Expiration and EOM Trading Patterns In the annual report, the Exchange also proposes to identify Weekly Expiration and EOM trading patterns by undertaking a time series analysis of open interest in Weekly Expiration and EOM series aggregated by expiration date compared to open interest in near-term standard Expiration Friday a.m.-settled series in order to determine whether users are shifting positions from standard series to Weekly Expiration and EOM series. In addition, to the extent that data on other weekly or monthly p.m. settled products from other exchanges is publicly available, the annual report will also compare open interest with these options in order to determine whether users are shifting positions from other weekly or monthly p.m.-settled products to the Weekly Expiration and EOM series. Declining open interest in standard series or the weekly or monthly p.m.-settled products of other exchanges accompanied by rising open interest in Weekly Expiration and EOM series would suggest that users are shifting positions. Provisional Analysis of Index Price Volatility and Share Trading Activity For each Weekly Expiration and EOM expiration that has open interest that exceeds certain minimum thresholds, the annual report will contain the following analysis related to index price changes and, if needed, underlying share trading volume at the close on expiration dates: (1) A comparison of index price changes at the close of trading on a given expiration date with comparable price changes from a control sample. The data will include a calculation of percentage price changes for various time intervals and compare that information to the respective control sample. Raw percentage price change data as well as percentage price change data normalized for prevailing market volatility, as measured by an appropriate index agreed by the Commission and the Exchange, will be provided; and (2) if needed, a calculation of share volume for a sample set of the component securities representing an upper limit on share trading that could be attributable to expiring in-the-money Weekly Expiration and EOM expirations. The data, if needed, will include a comparison of the calculated share volume for securities in the sample set to the average daily trading volumes of those securities over a sample period. The minimum open interest parameters, control sample, time intervals, method for selecting the component securities, and sample periods will be determined by the Exchange and the Commission. III. Discussion and Commission's Findings After careful review of the proposed rule change, the Commission finds that the proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange.\7\ Specifically, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Act,\8\ which requires, among other things, that the rules of a national securities exchange be 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 regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and to protect investors and the public interest. --------------------------------------------------------------------------- \7\ In approving this rule change, the Commission has considered the rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). \8\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- While the Commission has had concerns about the adverse effects and impact of p.m.-settlement upon market volatility and the operation of fair and orderly markets on the underlying cash market at or near the close of trading, it has approved on a limited basis p.m.-settlement for cash-settled options.\9\ More specifically, the Commission approved on a pilot basis CBOE's nearly identical and Phlx's identical Nonstandard Expirations Pilot Programs.\10\ --------------------------------------------------------------------------- \9\ See, e.g., Securities Exchange Act Release Nos. 31800 (February 1, 1993), 58 FR 7274 (February 5, 1993) (SR-CBOE-92-13) (Order approving CBOE's listing of p.m.-settled, cash-settled options on certain broad-based indexes); 61439 (January 28, 2010), 75 FR 5831 (February 4, 2010) (SR-CBOE-2009-087) (Order approving CBOE's listing of p.m.-settled FLEX options on a pilot basis); 70087 (July 31, 2013), 78 FR 47809 (August 6, 2013) (SR-CBOE-2013-055) (Order approving the addition of p.m.-settled mini-SPX index options to the SPXPM Pilot for p.m.-settled SPX index options); 81293 (August 2, 2017), 82 FR 37138 (August 8, 2017) (SR-Phlx-2017-04) (Order approving Phlx to list and trade of p.m.-settled NASDAQ-100 Index(R) Options on a Pilot Basis). \10\ See supra notes 4-5. --------------------------------------------------------------------------- Like Phlx, the Exchange patterns its proposal after CBOE's and includes the same additional data element that Phlx includes in the annual report: An analysis of publicly available data concerning trading patterns with respect to other p.m.-settled products from other exchanges. In all other aspects, the Exchange's proposed and Phlx's and CBOE's existing Nonstandard Expirations Pilot Programs are identical. The Commission believes that the Exchange's proposal strikes a reasonable balance between the Exchange's desire to offer a wider array of investment opportunities and the need to avoid unnecessary proliferation of options series that may burden certain liquidity providers and further stress options [[Page 5473]] quotation and transaction infrastructure. The Exchange's proposed twelve-month Pilot Program will allow for both the Exchange and the Commission to continue monitoring the potential for adverse market effects of p.m.-settlement on the market, including the underlying cash equities markets, at the expiration of these options. The Commission notes that the Exchange will provide the Commission with the annual report analyzing volume and open interest of EOMs and Weekly Expirations that will also contain information and analysis of EOMs and Weekly Expirations trading patterns and index price volatility and share trading activity for series that exceed minimum parameters. This information should be useful to the Commission as it evaluates whether allowing p.m.-settlement for EOMs and Weekly Expirations has resulted in increased market and price volatility in the underlying component stocks, particularly at expiration. The Pilot Program information should help the Commission and the Exchange assess the impact on the markets and determine whether changes to these programs are necessary or appropriate. Furthermore, the Exchange's ongoing analysis of the Pilot Program should help it monitor any potential risks from large p.m.-settled positions and take appropriate action, if warranted. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,\11\ that the proposed rule change (SR-ISE-2017-111) be approved for a pilot period of twelve months. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\12\ --------------------------------------------------------------------------- \12\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-02394 Filed 2-6-18; 8:45 am] BILLING CODE 8011-01-P
![5470 Federal Register / Vol. 83, No. 26 / Wednesday, February 7, 2018 / Notices
have to expire no later than the end of A proposed rule change filed under file number should be included on the
the trading day on which it was entered. Rule 19b–4(f)(6) 12 normally does not subject line if email is used. To help the
As such, the proposed rule change become operative prior to 30 days after Commission process and review your
would foster cooperation and the date of the filing. However, Rule comments more efficiently, please use
coordination with persons engaged in 19b–4(f)(6)(iii) 13 permits the only one method. The Commission will
facilitating transactions in securities and Commission to designate a shorter time post all comments on the Commission’s
would remove impediments to and if such action is consistent with the internet website (http://www.sec.gov/
perfect the mechanism of a free and protection of investors and the public rules/sro.shtml). Copies of the
open market and a national market interest. The Exchange has asked the submission, all subsequent
system. Commission to waive the 30-day amendments, all written statements
operative delay so that the Exchange with respect to the proposed rule
(B) Self-Regulatory Organization’s
may, as soon as possible, implement the change that are filed with the
Statement on Burden on Competition
proposed rule change. The Exchange Commission, and all written
The Exchange does not believe that notes that the proposal will promote communications relating to the
the proposed rule change will impose consistency between the Exchange and proposed rule change between the
any burden on competition that is not its affiliated exchange, EDGX Options. Commission and any person, other than
necessary or appropriate in furtherance The Commission believes that waiver of those that may be withheld from the
of the purposes of the Act. The the 30-day operative delay is consistent public in accordance with the
Exchange notes that the proposal will with the protection of investors and the provisions of 5 U.S.C. 552, will be
promote consistency between the public interest. Accordingly, the available for website viewing and
Exchange and its affiliated exchange, Commission hereby waives the printing in the Commission’s Public
EDGX Options, by offering the GTC operative delay and designates the Reference Room, 100 F Street NE,
Time in Force. The proposed change to proposed rule change as operative upon Washington, DC 20549, on official
GTD is a minor update to an existing filing.14 business days between the hours of
Time in Force, given the update to the At any time within 60 days of the 10:00 a.m. and 3:00 p.m. Copies of the
Exchange’s technology that will allow filing of the proposed rule change, the filing also will be available for
orders to persist for more than one Commission summarily may inspection and copying at the principal
trading day. The Exchange does not temporarily suspend such rule change if office of the Exchange. All comments
believe that the proposed changes will it appears to the Commission that such received will be posted without change.
have any direct impact on competition. action is: (i) Necessary or appropriate in Persons submitting comments are
Thus, the Exchange does not believe the public interest; (ii) for the protection cautioned that we do not redact or edit
that the proposal creates any significant of investors; or (iii) otherwise in personal identifying information from
impact on competition. furtherance of the purposes of the Act. comment submissions. You should
(C) Self-Regulatory Organization’s If the Commission takes such action, the submit only information that you wish
Statement on Comments on the Commission shall institute proceedings to make available publicly. All
Proposed Rule Change Received From to determine whether the proposed rule submissions should refer to File
Members, Participants or Others should be approved or disapproved. Number SR–CboeBZX–2018–006 and
should be submitted on or before
The Exchange has not solicited, and IV. Solicitation of Comments February 28, 2018.
does not intend to solicit, comments on Interested persons are invited to
this proposed rule change. The For the Commission, by the Division of
submit written data, views, and Trading and Markets, pursuant to delegated
Exchange has not received any written arguments concerning the foregoing, authority.15
comments from members or other including whether the proposed rule Eduardo A. Aleman,
interested parties. change is consistent with the Act. Assistant Secretary.
III. Date of Effectiveness of the Comments may be submitted by any of [FR Doc. 2018–02396 Filed 2–6–18; 8:45 am]
Proposed Rule Change and Timing for the following methods: BILLING CODE 8011–01–P
Commission Action Electronic Comments
Because the foregoing proposed rule • Use the Commission’s internet
change does not: (i) Significantly affect SECURITIES AND EXCHANGE
comment form (http://www.sec.gov/ COMMISSION
the protection of investors or the public rules/sro.shtml); or
interest; (ii) impose any significant • Send an email to rule-comments@ [Release No. 34–82612; File No. SR–ISE–
burden on competition; and (iii) become sec.gov. Please include File Number SR– 2017–111]
operative for 30 days from the date on CboeBZX–2018–006 on the subject line.
which it was filed, or such shorter time Self-Regulatory Organizations; Nasdaq
as the Commission may designate, it has Paper Comments ISE, LLC; Order Approving a Proposed
become effective pursuant to Section • Send paper comments in triplicate Rule Change To Establish a
19(b)(3)(A)(iii) of the Act 10 and to Secretary, Securities and Exchange Nonstandard Expirations Pilot
subparagraph (f)(6) of Rule 19b–4 Commission, 100 F Street NE, Program
thereunder.11 Washington, DC 20549–1090. February 1, 2018.
All submissions should refer to File
10 15 U.S.C. 78s(b)(3)(A)(iii). I. Introduction
sradovich on DSK3GMQ082PROD with NOTICES
11 17
Number SR–CboeBZX–2018–006. This
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the On December 21, 2017, Nasdaq ISE,
Commission written notice of the Exchange’s intent
12 17 CFR 240.19b–4(f)(6). LLC (‘‘ISE’’ or ‘‘Exchange’’) filed with
13 17 CFR 240.19b–4(f)(6)(iii).
to file the proposed rule change, along with a brief the Securities and Exchange
description and text of the proposed rule change, 14 For purposes only of waiving the 30-day
Commission (‘‘Commission’’ or ‘‘SEC’’),
at least five business days prior to the date of filing operative delay, the Commission has also
of the proposed rule change, or such shorter time considered the proposed rule’s impact on pursuant to Section 19(b)(1) of the
as designated by the Commission. The Exchange efficiency, competition, and capital formation. See
has satisfied this requirement. 15 U.S.C. 78c(f). 15 17 CFR 200.30–3(a)(12).
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![Federal Register / Vol. 83, No. 26 / Wednesday, February 7, 2018 / Notices 5473
quotation and transaction infrastructure. SECURITIES AND EXCHANGE Quarterly Options Series expires
The Exchange’s proposed twelve-month COMMISSION (‘‘Monday SPY Expirations’’).6 In the
Pilot Program will allow for both the case of a series that is listed on a Friday
[Release No. 34–82611; File No. SR–Phlx–
Exchange and the Commission to 2017–103]
and expires on a Monday, it must be
continue monitoring the potential for listed one business week and one
adverse market effects of p.m.- Self-Regulatory Organizations; Nasdaq business day prior to that Monday
settlement on the market, including the PHLX LLC; Order Approving a expiration.7 If the Monday SPY
underlying cash equities markets, at the Proposed Rule Change To Expand the Expirations falls on a Monday that is not
expiration of these options. Short Term Option Series Program To a business day, the series shall expire on
Allow Monday Expirations for SPY the first business day immediately
The Commission notes that the following that Monday.8 The Exchange
Options
Exchange will provide the Commission also proposes to amend Commentary .11
with the annual report analyzing February 1, 2018. to Phlx Rule 1012 state that it may list
volume and open interest of EOMs and I. Introduction up to five consecutive Monday SPY
Weekly Expirations that will also Expirations at one time, and may have
contain information and analysis of On December 6, 2017, the Nasdaq no more than a total of five Monday SPY
EOMs and Weekly Expirations trading PHLX LLC (‘‘Phlx’’ or ‘‘Exchange’’) filed Expirations (in addition to a maximum
patterns and index price volatility and with the Securities and Exchange of five Short Term Option Series for
Commission (‘‘Commission’’), pursuant SPY expiring on Friday and five
share trading activity for series that
to Section 19(b)(1) of the Securities Wednesday SPY Expirations). In
exceed minimum parameters. This
Exchange Act of 1934 (‘‘Act’’) 1 and Rule addition, like Wednesday SPY
information should be useful to the 19b–4 thereunder,2 a proposed rule
Commission as it evaluates whether Expirations and unlike other option
change to amend Rule 1000 and series in the Short Term Option Series
allowing p.m.-settlement for EOMs and Commentary .11 to Rule 1012 to expand
Weekly Expirations has resulted in program, Monday SPY Expirations
the Short Term Option Series Program could expire in the same week in which
increased market and price volatility in to permit listing and trading of options
the underlying component stocks, monthly option series in the same class
on the SPDR S&P 500 ETF Trust expire.9 Otherwise, Monday SPY
particularly at expiration. The Pilot (‘‘SPY’’) with Monday expirations. The Expirations are subject to the same rules
Program information should help the proposed rule change was published for
as standard Short Term Option Series.10
Commission and the Exchange assess comment in the Federal Register on
the impact on the markets and December 26, 2017.3 The Commission III. Discussion and Commission’s
determine whether changes to these received no comments on the proposal. Findings
programs are necessary or appropriate. This order approves the proposed rule The Commission has carefully
Furthermore, the Exchange’s ongoing change. reviewed the proposed rule change and
analysis of the Pilot Program should II. Description of the Proposal finds that it is consistent with the
help it monitor any potential risks from requirements of the Act and the rules
Under the terms of the current Short
large p.m.-settled positions and take and regulations thereunder applicable to
Term Option Series Program, after an
appropriate action, if warranted. a national securities exchange and, in
option class has been approved for
particular, the requirements of Section
IV. Conclusion listing and trading on the Exchange, the
6(b) of the Act.11 Specifically, the
Exchange may open for trading on any
It is therefore ordered, pursuant to Commission finds that the proposal is
Thursday or Friday that is a business
Section 19(b)(2) of the Act,11 that the consistent with the requirements of
day series of options on that class that
proposed rule change (SR–ISE–2017– Sections 6(b)(5) of the Act,12 which
expire on each of the next five Fridays,
requires, among other things, that a
111) be approved for a pilot period of provided that such Friday is not a
national securities exchange have rules
twelve months. Friday in which monthly options series
designed to prevent fraudulent and
For the Commission, by the Division of or Quarterly Options Series expire.4 In
manipulative acts and practices, to
Trading and Markets, pursuant to delegated addition, the Exchange may open for
promote just and equitable principles of
authority.12 trading on any Tuesday or Wednesday
trade, to foster cooperation and
that is a business day series of options
Eduardo A. Aleman, coordination with persons engaged in
on SPY to expire on up to five
Assistant Secretary. consecutive Wednesdays, provided that 6 Under the proposal, the Exchange would
[FR Doc. 2018–02394 Filed 2–6–18; 8:45 am] each such Wednesday is a business day expand the definition of ‘‘Short Term Option
BILLING CODE 8011–01–P and is not a Wednesday in which Series’’ in Phlx Rule 1044(b)(44) and add a
Quarterly Options Series expire.5 description of Monday SPY Expirations to
The Exchange proposes to expand the Commentary .11 to Phlx Rule 1012. See Notice,
supra note 3, at 61048.
Short Term Option Series to permit Phlx 7 See proposed Commentary .11 to Phlx Rule
to open for trading, on any Monday or 1012.
Friday that is a business day, series of 8 See proposed Phlx Rule 1000(b)(44).
options on SPY that expire on any 9 See proposed Commentary .11 to Phlx Rule
Monday of the month that is a business 1012.
10 For example, Monday SPY Expirations would
day and is not a Monday in which
sradovich on DSK3GMQ082PROD with NOTICES
be subject to the same series limitations and strike
interval rules as standard Short Term Option Series.
1 15 U.S.C. 78s(b)(1). See Notice, supra note 3, at 61048.
2 17 CFR 240.19b–4. 11 15 U.S.C. 78f. In approving this proposed rule
3 See Securities Exchange Act Release No. 82363
change, the Commission has considered the
(December 19, 2017), 82 FR 61047 (December 26, proposed rule change’s impact on efficiency,
2017) (‘‘Notice’’). competition, and capital formation. See 15 U.S.C.
11 15 U.S.C. 78s(b)(2). 4 See Commentary .11 to Phlx Rule 1012. 78c(f).
12 17 CFR 200.30–3(a)(12). 5 See id. 12 15 U.S.C. 78f(b)(5).
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Document Created: 2018-10-26 13:55:24
Document Modified: 2018-10-26 13:55:24
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| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| FR Citation | 83 FR 5470 |
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