83 FR 54793 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Regarding Certain Investments of the PGIM Ultra Short Bond ETF
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 211 (October 31, 2018)
Federal Register Volume 83, Issue 211 (October 31, 2018)
| Page Range | 54793-54796 | |
| FR Document | 2018-23730 |
[Federal Register Volume 83, Number 211 (Wednesday, October 31, 2018)] [Notices] [Pages 54793-54796] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-23730] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-84486; File No. SR-NYSEArca-2018-75] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Regarding Certain Investments of the PGIM Ultra Short Bond ETF October 25, 2018. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on October 12, 2018, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. 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\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes certain changes regarding investments of the PGIM Ultra Short Bond ETF (the ``Fund''), a series of PGIM ETF Trust (the ``Trust''), and shares of which are currently listed and traded on the Exchange under NYSE Arca Rule 8.600-E (``Managed Fund Shares''). The proposed change is available on the Exchange's website at www.nyse.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. 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 those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts 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 certain changes, described below under ``Application of Generic Listing Requirements,'' regarding investments of the Fund. The shares (``Shares'') of the Fund are currently listed and traded on the Exchange under Commentary .01 to NYSE Arca Rule 8.600-E,\4\ which provides generic criteria applicable to the listing and trading of Managed Fund Shares.\5\ The Commission has previously approved a proposed rule change regarding certain changes that would result in the portfolio for the Fund not meeting all of the ``generic'' listing requirements of Commentary .01 to NYSE Arca Rule 8.600-E applicable to the listing of Managed Fund Shares.\6\ --------------------------------------------------------------------------- \4\ Shares of the Fund commenced trading on the Exchange on April 10, 2018 pursuant to Commentary .01 to NYSE Arca Rule 8.600-E. \5\ A Managed Fund Share is a security that represents an interest in an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a-1) (the ``1940 Act'') organized as an open-end investment company or similar entity that invests in a portfolio of securities selected by its investment adviser consistent with its investment objectives and policies. In contrast, an open-end investment company that issues Investment Company Units, listed and traded on the Exchange under NYSE Arca Rule 5.2-E(j)(3), seeks to provide investment results that correspond generally to the price and yield performance of a specific foreign or domestic stock index, fixed income securities index or combination thereof. \6\ See Amendment No. 1 to SR-NYSEArca-2018-15, available at https://www.sec.gov/comments/sr-nysearca-2018-15/nysearca201815-3510337-162292.pdf (``Prior Amendment''); Securities Exchange Act Release No. 83319 (May 24, 2018), 83 FR 25097 (May 31, 2018) (SR- NYSEArca-2018-15), (Order Approving a Proposed Rule Change, as Modified by Amendment No. 1 Thereto, to Continue Listing and Trading Shares of the PGIM Ultra Short Bond ETF Under NYSE Arca Rule 8.600- E) (``Approval Order'' and, together with the Prior Amendment, the ``Prior Releases''). The Prior Releases stated that the Fund's portfolio would meet all requirements of Commentary .01 to NYSE Arca Rule 8.600-E except for those set forth in Commentary .01(a)(1), Commentary .01(b)(4) and Commentary .01(b)(5). --------------------------------------------------------------------------- PGIM Investments LLC (the ``Adviser'') is the investment adviser for the Fund. PGIM Fixed Income (the ``Subadviser''), a unit of PGIM, Inc., is the subadviser to the Fund. The Adviser and the Subadviser are indirect wholly-owned subsidiaries of Prudential Financial, Inc.\7\ --------------------------------------------------------------------------- \7\ The Trust is registered under the 1940 Act. On March 26, 2018, the Trust filed with the Commission Pre-Effective Amendment No. 1 to the Trust's registration statement on Form N-1A under the Securities Act of 1933 (15 U.S.C. 77a) (``Securities Act''), and under the 1940 Act relating to the Fund (File Nos. 333-222469 and 811-23324) (``Registration Statement''). The Trust will file an amendment to the Registration Statement as necessary to conform to the representations in this filing. The description of the operation of the Trust and the Fund herein is based, in part, on the Registration Statement. In addition, the Commission has issued an order granting certain exemptive relief to the Trust under the1940 Act. See Investment Company Act Release No. 31095 (June 24, 2014) (File No. 812-14267). --------------------------------------------------------------------------- As stated in the Prior Releases, the Fund may invest in derivatives to (i) provide exposure to the ``Principal Investment Instruments'' (as defined in the Prior Releases), and (ii) enhance returns, manage portfolio duration, or manage the risk of securities price fluctuations. Derivatives that the Fund may enter into include only: Over-the-counter (``OTC'') deliverable and non-deliverable foreign exchange forward contracts; listed futures contracts on one [[Page 54794]] or more Principal Investment Instruments securities (including Treasury securities and foreign government securities), indices relating to one or more Principal Investment Instruments, interest rates, financial rates and currencies; listed or OTC options (including puts or calls) or swaptions (i.e., options to enter into a swap) on one or more Principal Investment Instruments, indices relating to one or more Principal Investment Instruments, interest rates, financial rates, currencies and futures contracts on one or more Principal Investment Instruments; and listed or OTC swaps (including total return swaps) on securities, indices relating to one or more Principal Investment Instruments, interest rates, financial rates, currencies and debt and credit default swaps on single names, baskets and indices on one or more Principal Investment Instruments (both as protection seller and as protection buyer).\8\ --------------------------------------------------------------------------- \8\ Because the markets for the Principal Investment Instruments, or the Principal Investment Instruments themselves, may be unavailable or cost prohibitive as compared to derivative instruments, suitable derivative transactions may be an efficient alternative for the Fund to obtain the desired asset exposure to Principal Investment Instruments. --------------------------------------------------------------------------- Investments in derivative instruments will be made in accordance with the 1940 Act and consistent with the Fund's investment objective and policies. Application of Generic Listing Requirements The Exchange proposes that up to 50% of the Fund's assets (calculated as the aggregate gross notional value) may be invested in OTC derivatives, including forwards, OTC options and OTC swaps, that are used to reduce currency, interest rate, credit or duration risk arising from the Fund's investments (that is, ``hedge''). The Fund's investments in OTC derivatives, other than OTC derivatives used to hedge the Fund's portfolio against currency, interest rate, credit or duration risk will be limited to 20% of the assets in the Fund's portfolio, calculated as the aggregate gross notional value of such OTC derivatives. The Exchange is submitting this proposed rule change because the change described in the preceding paragraph would not conform to the Exchange's representations regarding the Fund's portfolio in the Prior Amendment. In the Prior Amendment, the Exchange stated that, other than Commentary .01(a)(1), Commentary .01(b)(4) and Commentary .01(b)(5), the Shares of the Fund will conform to the initial and continued listing criteria under NYSE Arca Rule 8.600-E. However, the proposed change described in the preceding paragraph would not meet the requirements set forth in Commentary .01(e).\9\ Specifically, the aggregate gross notional value of the Fund's investments in OTC derivatives may exceed 20% of Fund assets, calculated as the aggregate gross notional value of such OTC derivatives. --------------------------------------------------------------------------- \9\ Commentary .01(e) to NYSE Arca Rule 8.600-E provides that a portfolio may hold OTC derivatives, including forwards, options and swaps on commodities, currencies and financial instruments (e.g., stocks, fixed income, interest rates, and volatility) or a basket or index of any of the foregoing; however, on both an initial and continuing basis, no more than 20% of the assets in the portfolio may be invested in OTC derivatives. For purposes of calculating this limitation, a portfolio's investment in OTC derivatives will be calculated as the aggregate gross notional value of the OTC derivatives. --------------------------------------------------------------------------- The Adviser and Subadviser believe that it is important to provide the Fund with additional flexibility to manage risk associated with its investments. Depending on market conditions, it may be critical that the Fund be able to utilize available OTC derivatives for this purpose to attempt to reduce impact of currency, interest rate, credit or duration fluctuations on Fund assets. OTC derivatives provide the Fund with additional flexibility as well as a more precise means to effectively attempt to reduce currency, interest rate, credit or duration fluctuations on Fund assets. Generally, OTC derivatives can be customized to a greater degree than exchange-traded derivatives and can provide a better hedge on Fund assets as well as allow for more control over the duration of the hedge which can also mitigate trading costs. Therefore, the Exchange believes it is appropriate to apply a limit of up to 50% of the Fund's assets to the Fund's investments in OTC derivatives (calculated as the aggregate gross notional value of such OTC derivatives), including forwards, options and swaps, that are used for hedging purposes, as described above.\10\ --------------------------------------------------------------------------- \10\ The Commission has previously approved an exception from requirements set forth in Commentary .01(e) relating to investments in OTC derivatives similar to those proposed with respect to the Fund in Securities Exchange Act Release No. 80657 (May 11, 2017), 82 FR 22702 (May 17, 2017) (SR-NYSEArca-2017-09) (Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 2, Regarding Investments of the Janus Short Duration Income ETF Listed Under NYSE Arca Equities Rule 8.600). See also, Securities Exchange Act Release No. 84047 (September 6, 2018), 83 FR 46200 (September 12, 2018) (SR- NASDAQ-2017-128) (Notice of Filing of Amendment No. 3 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 3, to List and Trade Shares of the Western Asset Total Return ETF), in which the Nasdaq Stock Market LLC proposed that there would be no limit on the fund's investments in Interest Rate and Currency Derivatives, and that the aggregate weight of all OTC Derivatives other than Interest Rate and Currency Derivatives will not exceed 10% of the fund's assets). --------------------------------------------------------------------------- The Adviser and Subadviser represent that deviations from the generic requirements are necessary for the Fund to achieve its investment objective in a manner that is cost-effective and that maximizes investors' returns because OTC derivatives generally provide the Fund with more flexibility to negotiate the exact exposure and duration that the Fund requires, and minimize trading costs because OTC derivatives are not subject to costs of rolling that are associated with listed derivatives. Further, the proposed alternative requirements are narrowly tailored to allow the Fund to achieve its investment objective in manner that is consistent with the principles of Section 6(b)(5) of the Act. As a result, it is in the public interest to approve listing and trading of Shares of the Fund on the Exchange pursuant to the requirements set forth herein. Because the Fund, in furtherance of its investment objective, may invest a substantial percentage of its investments in Principal Investment Instruments with a maturity of one year or more, the 20% limit in Commentary .01(e) to Rule 8.600 could result in the Fund being unable to fully pursue its investment objective while attempting to sufficiently mitigate investment risks. The inability of the Fund to adequately hedge its holdings would effectively limit the Fund's ability to invest in certain instruments, or could expose the Fund to additional investment risk. For example, if the Fund's assets (on a gross notional value basis) were $100 million and no listed derivative were suitable to hedge the Fund's risk, under the generic listing criteria, the Fund would be limited to holding up to $20 million gross notional value in OTC derivatives ($100 million * 20%). Accordingly, the maximum amount the Fund would be able to invest in Principal Investment Instruments with a maturity of one year or more while remaining adequately hedged would be $20 million. The Fund then would hold $60 million in assets that could not be hedged, other than with listed derivatives, which, as noted above, might not be sufficiently tailored to the specific instruments to be hedged. In addition, by applying the 20% limitation in Commentary .01(e) to Rule 8.600, the Fund would be less able to protect its holdings from more than one risk simultaneously. For example, if the Fund's assets (on a gross notional basis) were $100 million and the Fund held $20 million in Principal Investment Instruments with a maturity of one year [[Page 54795]] or more with two types of risks (e.g., duration and credit risk) which could not be hedged using listed derivatives, the Fund would be faced with the choice of either holding $20 million aggregate gross notional value in OTC derivatives to mitigate one of the risks while passing the other risk to its shareholders, or, for example, holding $10 million aggregate gross notional value in OTC derivatives on each of the risks while passing the remaining portion of each risk to the Fund's shareholders. The Exchange accordingly believes that it is appropriate and in the public interest to approve continued listing and trading of Shares of the Fund on the Exchange notwithstanding that the Fund would not meet the requirements of Commentary .01(e) to Rule 8.600-E. The Exchange notes that, other than Commentary .01(e) and, as described in the Prior Releases, with the exception of the requirements of Commentary .01(a)(1), Commentary .01(b)(4) and Commentary .01(b)(5), the Shares of the Fund will conform to the initial and continued listing criteria under NYSE Arca Rule 8.600-E. The Adviser and Subadviser represent that the proposed change described above is consistent with the Fund's investment objective, and will further assist the Adviser and Subadviser to achieve such investment objective. Except for the changes noted above, all other representations made in the Prior Releases remain unchanged. All terms referenced but not defined in this proposed rule change are defined in the Prior Releases. 2. Statutory Basis The basis under the Act for this proposed rule change is the requirement under Section 6(b)(5) of the Act that an exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. The Exchange believes that it is appropriate and in the public interest to allow the Fund, for hedging purposes only, to exceed the 20% limit in Commentary .01(e) to Rule 8.600 of portfolio assets that may be invested in OTC derivatives to a maximum of 50% of Fund assets (calculated as the gross notional value). As noted above, the Adviser and Subadviser believe that it is in the best interests of the Fund's shareholders for the Fund to be allowed to reduce the currency, interest rate, credit or duration risk arising from the Fund's investments using the most efficient financial instruments. While certain risks can be hedged via listed derivatives, OTC derivatives (such as forwards, options and swaps) can be customized to hedge against precise risks. Accordingly, the Adviser and Subadviser believe that OTC derivatives may frequently be a more efficient hedging vehicle than listed derivatives. Depending on market conditions, it may be critical that the Fund be able to utilize available OTC derivatives for this purpose to attempt to reduce impact of currency, interest rate, credit or duration fluctuations on Fund assets. Therefore, the Exchange believes that increasing the percentage limit in Commentary .01(e), as described above, to the Fund's investments in OTC derivatives, including forwards, options and swaps, that are used specifically for hedging purposes would help protect investors and the public interest. The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that it will facilitate the continued listing and trading of an actively-managed exchange-traded product that, through permitted use of an increased level of OTC derivatives above that currently permitted by the generic listing requirements of Commentary .01 to NYSE Arca Rule 8.600-E, will enhance competition among market participants, to the benefit of investors and the marketplace. 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 that is not necessary or appropriate in furtherance of the purpose of the Act. The Exchange notes that the proposed rule change will facilitate a change to the Fund's investments similar to investments of another actively managed ETF, shares of which have been approved for Exchange listing and trading,\11\ that principally holds fixed income securities, and that will enhance competition among market participants, to the benefit of investors and the marketplace. --------------------------------------------------------------------------- \11\ See note 10, supra. --------------------------------------------------------------------------- C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove the proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be 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 CommentsUse 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-NYSEArca-2018-75 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSEArca-2018-75. 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 website (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 website viewing and printing in the Commission's Public 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 the filing also will be available for [[Page 54796]] inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2018-75, and should be submitted on or before November 21, 2018. 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. 2018-23730 Filed 10-30-18; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 83, No. 211 / Wednesday, October 31, 2018 / Notices 54793
All submissions should refer to File ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 Shares.5 The Commission has
Number SR–ISE–2018–87. This file notice is hereby given that, on October previously approved a proposed rule
number should be included on the 12, 2018, NYSE Arca, Inc. (the change regarding certain changes that
subject line if email is used. To help the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with would result in the portfolio for the
Commission process and review your the Securities and Exchange Fund not meeting all of the ‘‘generic’’
comments more efficiently, please use Commission (the ‘‘Commission’’) the listing requirements of Commentary .01
only one method. The Commission will proposed rule change as described in to NYSE Arca Rule 8.600–E applicable
post all comments on the Commission’s Items I and II below, which Items have to the listing of Managed Fund Shares.6
internet website (http://www.sec.gov/ been prepared by the self-regulatory PGIM Investments LLC (the
rules/sro.shtml). Copies of the organization. The Commission is ‘‘Adviser’’) is the investment adviser for
submission, all subsequent publishing this notice to solicit the Fund. PGIM Fixed Income (the
amendments, all written statements comments on the proposed rule change ‘‘Subadviser’’), a unit of PGIM, Inc., is
with respect to the proposed rule from interested persons. the subadviser to the Fund. The Adviser
change that are filed with the and the Subadviser are indirect wholly-
I. Self-Regulatory Organization’s owned subsidiaries of Prudential
Commission, and all written Statement of the Terms of Substance of
communications relating to the Financial, Inc.7
the Proposed Rule Change As stated in the Prior Releases, the
proposed rule change between the
Commission and any person, other than The Exchange proposes certain Fund may invest in derivatives to (i)
those that may be withheld from the changes regarding investments of the provide exposure to the ‘‘Principal
public in accordance with the PGIM Ultra Short Bond ETF (the Investment Instruments’’ (as defined in
provisions of 5 U.S.C. 552, will be ‘‘Fund’’), a series of PGIM ETF Trust the Prior Releases), and (ii) enhance
available for website viewing and (the ‘‘Trust’’), and shares of which are returns, manage portfolio duration, or
printing in the Commission’s Public currently listed and traded on the manage the risk of securities price
Reference Room, 100 F Street NE, Exchange under NYSE Arca Rule 8.600– fluctuations. Derivatives that the Fund
Washington, DC 20549, on official E (‘‘Managed Fund Shares’’). The may enter into include only: Over-the-
business days between the hours of proposed change is available on the counter (‘‘OTC’’) deliverable and non-
10:00 a.m. and 3:00 p.m. Copies of the Exchange’s website at www.nyse.com, at deliverable foreign exchange forward
filing also will be available for the principal office of the Exchange, and contracts; listed futures contracts on one
inspection and copying at the principal at the Commission’s Public Reference
5 A Managed Fund Share is a security that
office of the Exchange. All comments Room.
represents an interest in an investment company
received will be posted without change. II. Self-Regulatory Organization’s registered under the Investment Company Act of
Persons submitting comments are Statement of the Purpose of, and 1940 (15 U.S.C. 80a-1) (the ‘‘1940 Act’’) organized
cautioned that we do not redact or edit as an open-end investment company or similar
Statutory Basis for, the Proposed Rule entity that invests in a portfolio of securities
personal identifying information from Change selected by its investment adviser consistent with
comment submissions. You should its investment objectives and policies. In contrast,
submit only information that you wish In its filing with the Commission, the an open-end investment company that issues
to make available publicly. All self-regulatory organization included Investment Company Units, listed and traded on
submissions should refer to File statements concerning the purpose of, the Exchange under NYSE Arca Rule 5.2–E(j)(3),
and basis for, the proposed rule change seeks to provide investment results that correspond
Number SR–ISE–2018–87 and should be generally to the price and yield performance of a
submitted on or before November and discussed any comments it received specific foreign or domestic stock index, fixed
21,2018. on the proposed rule change. The text income securities index or combination thereof.
of those statements may be examined at 6 See Amendment No. 1 to SR–NYSEArca–2018–
For the Commission, by the Division of the places specified in Item IV below. 15, available at https://www.sec.gov/comments/sr-
Trading and Markets, pursuant to delegated The Exchange has prepared summaries, nysearca-2018-15/nysearca201815-3510337-
authority.15 162292.pdf (‘‘Prior Amendment’’); Securities
set forth in sections A, B, and C below, Exchange Act Release No. 83319 (May 24, 2018), 83
Eduardo A. Aleman, of the most significant parts of such FR 25097 (May 31, 2018) (SR–NYSEArca–2018–15),
Assistant Secretary. statements. (Order Approving a Proposed Rule Change, as
[FR Doc. 2018–23732 Filed 10–30–18; 8:45 am] Modified by Amendment No. 1 Thereto, to
A. Self-Regulatory Organization’s Continue Listing and Trading Shares of the PGIM
BILLING CODE 8011–01–P
Statement of the Purpose of, and the Ultra Short Bond ETF Under NYSE Arca Rule
8.600–E) (‘‘Approval Order’’ and, together with the
Statutory Basis for, the Proposed Rule Prior Amendment, the ‘‘Prior Releases’’). The Prior
SECURITIES AND EXCHANGE Change Releases stated that the Fund’s portfolio would
COMMISSION meet all requirements of Commentary .01 to NYSE
1. Purpose Arca Rule 8.600–E except for those set forth in
The Exchange proposes certain Commentary .01(a)(1), Commentary .01(b)(4) and
[Release No. 34–84486; File No. SR– Commentary .01(b)(5).
changes, described below under 7 The Trust is registered under the 1940 Act. On
NYSEArca–2018–75] ‘‘Application of Generic Listing March 26, 2018, the Trust filed with the
Self-Regulatory Organizations; NYSE Requirements,’’ regarding investments Commission Pre-Effective Amendment No. 1 to the
Arca, Inc.; Notice of Filing of Proposed of the Fund. The shares (‘‘Shares’’) of Trust’s registration statement on Form N–1A under
the Fund are currently listed and traded the Securities Act of 1933 (15 U.S.C. 77a)
Rule Change Regarding Certain (‘‘Securities Act’’), and under the 1940 Act relating
Investments of the PGIM Ultra Short on the Exchange under Commentary .01 to the Fund (File Nos. 333–222469 and 811–23324)
Bond ETF to NYSE Arca Rule 8.600–E,4 which (‘‘Registration Statement’’). The Trust will file an
amozie on DSK3GDR082PROD with NOTICES1
provides generic criteria applicable to amendment to the Registration Statement as
October 25, 2018. the listing and trading of Managed Fund necessary to conform to the representations in this
filing. The description of the operation of the Trust
Pursuant to Section 19(b)(1) 1 of the 2 15
and the Fund herein is based, in part, on the
U.S.C. 78a. Registration Statement. In addition, the
Securities Exchange Act of 1934 (the 3 17CFR 240.19b–4. Commission has issued an order granting certain
4 Shares of the Fund commenced trading on the exemptive relief to the Trust under the1940 Act.
15 17 CFR 200.30–3(a)(12). Exchange on April 10, 2018 pursuant to See Investment Company Act Release No. 31095
1 15 U.S.C.78s(b)(1). Commentary .01 to NYSE Arca Rule 8.600–E. (June 24, 2014) (File No. 812–14267).
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![54796 Federal Register / Vol. 83, No. 211 / Wednesday, October 31, 2018 / Notices
inspection and copying at the principal website (http://www.cboe.com/ Number of
Sector Symbol 7
office of the Exchange. All comments AboutCBOE/ components
received will be posted without change. CBOELegalRegulatoryHome.aspx), at
Persons submitting comments are the Exchange’s Office of the Secretary, Financial ............... IXM 68
cautioned that we do not redact or edit and at the Commission’s Public Energy .................. IXE 31
Technology ........... IXT 76
personal identifying information from Reference Room. Health Care .......... IXV 63
comment submissions. You should Utilities .................. IXU 29
II. Self-Regulatory Organization’s
submit only information that you wish Consumer Staples IXR 32
Statement of the Purpose of, and
to make available publicly. All Industrials ............. IXI 70
Statutory Basis for, the Proposed Rule
submissions should refer to File Consumer Discre- IXY 80
Change
Number SR–NYSEArca–2018–75, and tionary.
should be submitted on or before In its filing with the Commission, the Materials ............... IXB 24
November 21, 2018. Exchange included statements Real Estate ........... IXRE 32
concerning the purpose of and basis for Communication IXC 26
For the Commission, by the Division of Services.
Trading and Markets, pursuant to delegated the proposed rule change and discussed
authority.12 any comments it received on the
proposed rule change. The text of these Initial and Maintenance Listing Criteria
Eduardo A. Aleman,
Assistant Secretary. statements may be examined at the The S&P Communication Services
[FR Doc. 2018–23730 Filed 10–30–18; 8:45 am]
places specified in Item IV below. The Select Sector Index meets the definition
BILLING CODE 8011–01–P
Exchange has prepared summaries, set of a narrow-based index as set forth in
forth in sections A, B, and C below, of Rule 24.1(i)(2) (an index designed to be
the most significant aspects of such representative of a particular industry or
SECURITIES AND EXCHANGE statements. a group of related industries and
COMMISSION include indices having component
A. Self-Regulatory Organization’s
securities that are all headquartered
[Release No. 34–84490; File No. SR–CBOE– Statement of the Purpose of, and
with in a single country). Additionally,
2018–067] Statutory Basis for, the Proposed Rule
the S&P Communication Services Select
Change
Self-Regulatory Organizations; Cboe Sector Index satisfies the initial listing
Exchange, Inc.; Notice of Filing and 1. Purpose criteria of a narrow-based index, as set
Immediate Effectiveness of a Proposed The Exchange is currently authorized forth in Rule 24.2(b):
Rule Change Relating to List and Trade (1) Options will be A.M.-settled;
to list for trading options on ten S&P
Options That Overlie the S&P (2) the index is capitalization-
Select Sector Indexes.5 The purpose of
Communication Services Select Sector weighted, price-weighted, equal dollar-
this proposed rule change is to amend
Index weighted, or modified capitalization-
certain rules to authorize the Exchange
weighted, and consists of ten or more
to list for trading options on a recently
October 25, 2018. component securities (the S&P
added eleventh S&P Select Sector
Pursuant to Section 19(b)(1) of the Communication Services Select Sector
Index—the S&P Communication
Securities Exchange Act of 1934 (‘‘Act’’ Index is modified capitalization-
Services Select Sector Index. Each S&P
or ‘‘Exchange Act’’),1 and Rule 19b–4 weighted);
Select Sector Index represents the
thereunder,2 notice is hereby given that (3) each component security has a
performance of companies that are
on October 15, 2018, Cboe Exchange, market capitalization of at least $75
components of the Standard & Poor’s
Inc. (‘‘Exchange’’ or ‘‘Cboe Options’’) million, except that for each of the
500 Index (‘‘S&P 500’’) within a specific
filed with the Securities and Exchange lowest weighted component securities
sector (each of which is referred to as an
Commission (‘‘Commission’’) the in the index that in the aggregate
‘‘S&P Select Sector Index’’). Each
proposed rule change as described in account for no more than 10% of the
constituent of an S&P Select Sector
Items I and II below, which Items have weight of the index, the market
Index is a constituent of the S&P 500,
been prepared by the Exchange. The capitalization is at least $50 million;
and each S&P Select Sector Index is a (4) trading volume of each component
Exchange filed the proposal as a ‘‘non-
subindex of the S&P 500. S&P Dow security has been at least one million
controversial’’ proposed rule change
Jones Indices 6 assigns each constituent shares for each of the last six months,
pursuant to Section 19(b)(3)(A)(iii) of
to a S&P Select Sector Index(es) based except that for each of the lowest
the Act 3 and Rule 19b–4(f)(6)
on the constituent’s classification under weighted component securities in the
thereunder.4 The Commission is
a global industry classification standard. index that in the aggregate account for
publishing this notice to solicit
S&P Dow Jones Indices monitors and no more than 10% of the weight of the
comments on the proposed rule change
maintains each Select Sector Index and index, trading volume has been at least
from interested persons.
rebalances each S&P Select Sector Index 500,000 shares for each of the last six
I. Self-Regulatory Organization’s quarterly. S&P Dow Jones Indices months;
Statement of the Terms of Substance of recently added an eleventh sector. As a (5) in a capitalization-weighted index
the Proposed Rule Change result, the following represents the or a modified capitalization-weighted
The text of the proposed rule change current breakdown of the sectors and index, the lesser of the five highest
is provided below in Exhibit 5. the components of each sector: weighted component securities in the
amozie on DSK3GDR082PROD with NOTICES1
The text of the proposed rule change index or the highest weighted
5 See Rule 24.9(a); see also Securities Exchange
is also available on the Exchange’s component securities in the index that
Act Release No. 34–81879 (October 16, 2017), 82 FR
48858 (October 20, 2017) (SR–CBOE–2017–065). in the aggregate represent at least 30%
12 17 CFR 200.30–3(a)(12). 6 S&P Dow Jones Indices is the reporting authority
1 15 U.S.C. 78s(b)(1). for the S&P Select Sector Indexes, including the 7 These symbols represent the index. The
2 17 CFR 240.19b–4.
S&P Communication Services Select Sector Index. corresponding option symbols are SIXM, SIXE,
3 15 U.S.C. 78s(b)(3)(A)(iii).
See proposed Rule 24.1, Interpretation and Policy SIXT, SIXV, SIXU, SIXR, SIXI, SIXY, SIXB, SIXRE,
4 17 CFR 240.19b–4(f)(6). .01. and SIXC respectively.
VerDate Sep<11>2014 18:06 Oct 30, 2018 Jkt 247001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 E:\FR\FM\31OCN1.SGM 31OCN1](https://thefederalregister.org/doc/83_FR_55004/page/4.svg)
Document Created: 2018-10-31 00:33:18
Document Modified: 2018-10-31 00:33:18
| 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 | 83 FR 54793 |
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