83 FR 8128 - Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Expand the Short Term Options Series Program To Allow Monday Expirations for SPDR S&P 500 ETF Trust Options on the Exchange's Equity Options Platform
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 37 (February 23, 2018)
Federal Register Volume 83, Issue 37 (February 23, 2018)
| Page Range | 8128-8131 | |
| FR Document | 2018-03696 |
[Federal Register Volume 83, Number 37 (Friday, February 23, 2018)] [Notices] [Pages 8128-8131] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-03696] [[Page 8128]] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82735; File No. SR-CboeBZX-2018-012] Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Expand the Short Term Options Series Program To Allow Monday Expirations for SPDR S&P 500 ETF Trust Options on the Exchange's Equity Options Platform February 16, 2018. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on February 15, 2018, Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX Options'') 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 has designated this proposal as a ``non-controversial'' proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b- 4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with the Commission. 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). \4\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to expand the Short Term Options Series Program to allow Monday expirations for SPDR S&P 500 ETF Trust (``SPY'') options. (additions are italicized; deletions are [bracketed]) * * * * * Rules of Cboe BZX Exchange, Inc. * * * * * Rule 16.1. Definitions (a) With respect to the Rules contained in Chapters XVI to XXIX below, relating to the trading of options contracts on the Exchange, the following terms shall have the meanings specified in this Rule. A term defined elsewhere in the Exchange Rules shall have the same meaning with respect to this Chapter XVI, unless otherwise defined below. (1)-(56) (No change). (57) The term ``Short Term Option Series'' means a series in an option class that is approved for listing and trading on the Exchange in which the series is opened for trading on any Monday, Tuesday, Wednesday, Thursday or Friday that is a business day and that expires on the Monday, Wednesday or Friday of the next business week, or, in the case of a series that is listed on a Friday and expires on a Monday, is listed one business week and one business day prior to that expiration. If a Tuesday, Wednesday, Thursday or Friday is not a business day, the series may be opened (or shall expire) on the first business day immediately prior to that Tuesday, Wednesday, Thursday or Friday, respectively. For a series listed pursuant to this section for Monday expiration, if a Monday is not a business day, the series shall expire on the first business day immediately following that Monday. (58)-(63) (No change). Interpretations and Policies .01 (No change). * * * * * Rule 19.6. Series of Options Contracts Open for Trading (a)-(g) (No change). Interpretations and Policies .01-.04 (No change). .05 After an option class has been approved for listing and trading on BZX Options, the Exchange may open for trading on any Thursday or Friday that is a business day (``Short Term Option Opening Date'') series of options on that class that expire on each of the next five (5) Fridays that are business days and are not Fridays in which monthly options series or Quarterly Options Series expire (``Short Term Option Expiration Dates''). The Exchange may have no more than a total of five Short Term Option Expiration Dates, not including any Monday or Wednesday SPY Expirations as provided in paragraph (g) below. If BZX Options is not open for business on the respective Thursday or Friday, the Short Term Option Opening Date will be the first business day immediately prior to that respective Thursday or Friday. Similarly, if BZX Options is not open for business on the Friday that the options are set to expire, the Short Term Option Expiration Date will be the first business day immediately prior to that Friday. Regarding Short Term Option Series: (a) (No change). (b) With the exception of Monday and Wednesday SPY Expirations, no Short Term Option Series may expire in the same week in which monthly option series on the same class expire or, in the case of Quarterly Options Series, on an expiration that coincides with an expiration of Quarterly Options Series on the same class. (c)-(f) (No change). (g) Monday and Wednesday SPY Expirations. The Exchange may open for trading on any Friday or Monday that is a business day series of options on the SPDR S&P 500 ETF Trust (``SPY'') to expire on any Monday of the month that is a business day and is not a Monday on which Quarterly Options Series expire (``Monday SPY Expirations''), provided that any Friday on which the Exchange opens for trading a Monday SPY Expiration is one business week and one business day prior to expiration. The Exchange may also open for trading on any Tuesday or Wednesday that is a business day series of SPY options [on the SPDR S&P 500 ETF Trust (``SPY'')] to expire on any Wednesday of the month that is a business day and is not a Wednesday [i]on which Quarterly Options Series expire (``Wednesday SPY Expirations''). The Exchange may list up to five consecutive Monday SPY Expirations and up to five consecutive Wednesday SPY Expirations at one time; the Exchange may have no more than a total of five Monday SPY Expirations and no more than a total of five Wednesday SPY Expirations. Monday and Wednesday SPY Expirations will be subject to the provisions of this Rule. .06-.07 (No change). * * * * * The text of the proposed rule change is available at the Exchange's website at www.markets.cboe.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 Exchange 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 Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. [[Page 8129]] (A) Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to expand the Short Term Options Series Program described in Rule 19.6 to allow the listing and trading of SPY options with Monday expirations. The Exchange also proposes to make corresponding changes to the definition of Short Term Options Series in Rule 16.1. This is a competitive filing based on a filing submitted by Nasdaq PHLX LLC (``Phlx''), which the Securities and Exchange Commission (``Commission'') recently approved.\5\ --------------------------------------------------------------------------- \5\ See Securities Exchange Act Release No. 82611, February 1, 2018 (order approving SR-Phlx-2017-103). --------------------------------------------------------------------------- Currently, as set forth in Rule 16.1(a)(57), a Short Term Option Series is a series in an option class that is approved for listing and trading on the Exchange in which the series is opened for trading on any Tuesday, Wednesday, Thursday, or Friday that is a business day and that expires on the Wednesday or Friday of the next business week. The Exchange now proposes to amend Rule 16.1(a)(57) to permit the listing of options series that expire on Mondays. Specifically, the Exchange proposes that it may open for trading series of options on any Monday that is a business day and that expires on the Monday of the next business week. The Exchange also proposes to list Monday expirations series on Fridays that precede the expiration Monday by one business week plus one business day. Since Rule 16.1(a)(57) already provides for the listing of short term option series on Fridays, the Exchange is not modifying this provision to allow for Friday listing of Monday expiration series. However, the Exchange is amending Rule 16.1(a)(57) to clarify that, in the case of a series that is listed on a Friday and expires on a Monday, that series must be listed one business week and one business day prior to that expiration (i.e. two Fridays prior to expiration). Monday expirations are not a novel proposal. Specifically, Cboe Exchange, Inc. (``Cboe Options'') is currently able to list Monday expirations for broad-based index options.\6\ Additionally, Phlx recently received Commission approval to list Monday SPY Expirations.\7\ --------------------------------------------------------------------------- \6\ See Cboe Options Rule 24.9(e) (describing Cboe Options nonstandard expirations pilot program). Pursuant to the nonstandard expirations pilot program, if Cboe Options is not open for business on a respective Monday, the normally Monday expiring Weekly Expirations will expire on the following business day. \7\ See supra note 5. --------------------------------------------------------------------------- The Exchange also proposes to amend Rule 16.1(a)(57) to address the expiration of Monday expiration series when the Monday is not a business day. In that case, the rule will provide that the series will expire on the first business day immediately following that Monday. This procedure differs from the expiration date of the Wednesday expiration series that are scheduled to expire on a holiday. In that case, the Wednesday expiration series will expire on the first business day immediately prior to that Wednesday (e.g., Tuesday of that week).\8\ However, the Exchange believes it is preferable to require Monday expiration series in this scenario to expire on the Tuesday of that week rather than the previous business day (e.g., the previous Friday), since the Tuesday is closer in time to the scheduled expiration date of the series than the previous Friday, and therefore may be more representative of anticipated market conditions. The Exchange also notes that Cboe Options uses the same procedure for options on the S&P 500 index (``SPX'') with Monday expirations that are listed pursuant to its Nonstandard Expirations Pilot Program and that are scheduled to expire on a holiday.\9\ --------------------------------------------------------------------------- \8\ See Rule 16.1(a)(57). \9\ See Rule 24.9(e) (describing Cboe Options' nonstandard expirations pilot program). Pursuant to the nonstandard expirations pilot program, if Cboe Options is not open for business on a respective Monday, the normally Monday expiring Weekly Expirations will expire on the following business day. --------------------------------------------------------------------------- The Exchange also proposes to make corresponding changes to Rule 19.6, Interpretation and Policy .05, which sets forth the requirements for SPY options that are listed pursuant to the Short Term Options Series Program, to permit Monday SPY expirations (``Monday SPY Expirations''). Accordingly, the Exchange proposes to amend Interpretation and Policy .05(g) to state the Exchange may open for trading on any Friday or Monday that is a business day series of SPY options to expire on any Monday of the month that is a business day and is not a Monday on which Quarterly Options Series expire, provided that Monday SPY Expirations that are listed on a Friday must be listed at least one business week and one business day prior to the expiration. As with Wednesday SPY Expirations, the proposed rule change states the Exchange may list up to five consecutive Monday SPY Expirations at one time, and may have no more than a total of five Monday SPY Expirations (in addition to a maximum of five Short Term Options Series expirations for SPY options expiring on Friday and five Wednesday SPY Expirations). The Exchange proposes to clarify that the five expirations limit in the current Short Term Option Series Program would not include any Monday SPY Expirations. The five expirations limit in the current Short Term Option Series Program currently excludes any Wednesday SPY Expirations. This means, under the proposed rule change, the Exchange may list five Short Term Option Series expirations for SPY expiring on Friday, five Wednesday SPY Expirations, and five Monday SPY Expirations. The Exchange will also clarify that, as with Wednesday SPY Expirations, Monday SPY Expirations will be subject to the provisions of Rule 19.6. The proposed rule change also amends Rule 19.6, Interpretation and Policy .05(b), which addresses the listing of Short Term Option Series that expire in the same week as monthly or quarterly options series. Currently, the rule states no Short Term Option Series may expire in the same week in which monthly option series on the same class expire (with the exception of Wednesday SPY Expirations) or, in the case of Quarterly Option Series, on an expiration that coincides with an expiration of Quarterly Option Series on the same class. As with Wednesday SPY Expirations, the Exchange proposes to permit Monday SPY Expirations to expire in the same week as monthly option series on the same class. The Exchange believes it is reasonable to extend this exemption to Monday SPY Expirations because Monday SPY Expirations and standard monthly options will not expire on the same trading day, as standard monthly options expire on Fridays. Additionally, the Exchange believes that not listing Monday SPY Expirations for one week every month because there was a monthly SPY expiration on the Friday of that week would create investor confusion. The interval between strike prices for the proposed Monday SPY Expirations will be the same as those for the current Short Term Option Series for Wednesday and Friday SPY Expirations, which is a $0.50 strike interval minimum.\10\ --------------------------------------------------------------------------- \10\ See Rule 19.6, Interpretation and Policy .05(f) (the Exchange may open for trading Short Term Option Series at $0.50 strike price intervals for classes that trade in $1 dollar increments and are in the Short Term Option Series Program). Pursuant to Rule 19.4(d)(4), Interpretation and Policy .02, SPY options have $1 strike price intervals for non-Short Term Option Program series. --------------------------------------------------------------------------- [[Page 8130]] Currently, for each option class eligible for participation in the Short Term Option Series Program, the Exchange is limited to opening 30 series for each expiration date for the specific class. The 30 series restriction does not include series that are opened by other securities exchanges under their respective short term option rules; the Exchange may list these additional series that are listed by other exchanges.\11\ This 30 series restriction will apply to Monday SPY Expirations as well. In addition, the Exchange will be able to list series that are listed by other exchanges, assuming they file similar rules with the Commission to list SPY options expiring on Mondays. --------------------------------------------------------------------------- \11\ See Rule 19.6, Interpretation and Policy .05(a). --------------------------------------------------------------------------- As is the case with other options series listed pursuant to the Short Term Option Series, the Monday SPY Expiration series will be p.m.-settled. The Exchange does not believe that any market disruptions will be encountered with the introduction of p.m.-settled Monday expirations. The Exchange has necessary capacity and surveillance programs in place to support and properly monitor trading in the proposed Monday expiration series, including Monday SPY Expirations. The Exchange currently trades p.m.-settled Short Term Option Series that expire almost every Wednesday and Friday, which provide market participants with a tool to hedge special events and to reduce the premium cost of buying protection. The Exchange notes it has been listing Wednesday expirations since 2016. With the exception of Monday expiration series that are scheduled to expire on a holiday, the Exchange does not believe there are any material differences between Monday SPY Expirations and Wednesday or Friday SPY Expirations. The Exchange seeks to introduce Monday SPY Expirations to, among other things, expand hedging tools available to market participants and to continue the reduction of the premium cost of buying protection. The Exchange believes Monday SPY Expirations, similar to Wednesday and Friday SPY Expirations, will allow market participants to purchase a SPY option based on their timing as needed and allow them to tailor their investment and hedging needs more effectively. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ``Act'') and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.\12\ Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) \13\ requirements that the rules of an 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, in general, to protect investors and the public interest. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) \14\ requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. --------------------------------------------------------------------------- \12\ 15 U.S.C. 78f(b). \13\ 15 U.S.C. 78f(b)(5). \14\ Id. --------------------------------------------------------------------------- In particular, the Exchange believes the Short Term Option Series Program has been successful to date and that Monday SPY Expirations simply expand the ability of investors to hedge risk against market movements stemming from economic releases or market events that occur throughout the month in the same way the Short Term Option Series Program has expanded the landscape of hedging. Similarly, the Exchange believes Monday SPY Expirations should create greater trading and hedging opportunities and flexibility, and will provide customers with the ability to tailor their investment objectives more effectively. With the exception of Monday expiration series that are scheduled to expire on a holiday, the Exchange does not believe there are any material differences between Monday SPY Expirations and Wednesday or Friday SPY Expirations. The Exchange has been listing Wednesday SPY Expirations pursuant to Rule 19.6, Interpretation and Policy .05 since 2016. The Exchange believes it is consistent with the Act to treat Monday SPY Expirations that expire on a holiday differently than Wednesday and Friday SPY Expirations, since the proposed treatment for Monday SPY Expirations will result in an expiration date that is closer in time to the scheduled expiration date of the series, and therefore may be more representative of anticipated market conditions. Cboe Options uses the same procedure for broad-based index options with Monday expirations listed pursuant the Nonstandard Expirations Pilot Program that are scheduled to expire on a holiday.\15\ --------------------------------------------------------------------------- \15\ See Cboe Options Rule 24.9(e) (describing Cboe Options' nonstandard expirations pilot program). Pursuant to the nonstandard expirations pilot program, if the Exchange is not open for business on a respective Monday, the normally Monday expiring Weekly Expirations will expire on the following business day. --------------------------------------------------------------------------- Given the similarities between Monday SPY Expirations and Wednesday and Friday SPY Expirations, the Exchange believes applying the provisions in Rules 16.1(a)(57) and 19.6, Interpretation and Policy .05 that currently apply to Wednesday SPY Expirations to Monday SPY Expirations is justified. For example, the Exchange believes allowing Monday SPY Expirations and monthly SPY expirations in the same week will benefit investors and minimize investor confusion by providing Monday SPY Expirations in a continuous and uniform manner. Additionally, the Exchange believes it is appropriate to not permit Monday SPY Expirations to expire on the same day as an expiration of SPY Quarterly Option Series. This is consistent with treatment of Wednesday SPY Expirations, which may currently expire in the same week as a monthly SPY expiration but may not expire on the same day as an expiration of SPY Quarterly Option Series. The Exchange represents it has an adequate surveillance program in place to detect manipulative trading in Monday SPY Expirations in the same way it monitors trading in the current Short Term Option Series. The Exchange also represents it has the necessary systems capacity to support the new options series. The proposed rule change is consistent with current rules of another options exchange, pursuant to which Cboe Options currently lists Monday expirations for weekly broad-based index options.\16\ Additionally, the proposed rule change is consistent with rules of another options exchange, as Phlx recently received Commission approval to list Monday SPY Expirations.\17\ --------------------------------------------------------------------------- \16\ Id. \17\ See supra note 5. --------------------------------------------------------------------------- (B) Self-Regulatory Organization's Statement on Burden on Competition BZX Options does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. Having Monday expirations is not a novel proposal, as Cboe Options currently lists weekly broad- based index options with [[Page 8131]] Monday expirations pursuant to its nonstandard expirations pilot program. BZX Options does not believe the proposed rule change will impose any burden on intramarket competition, as all market participants will be treated in the same manner as they are with respect to existing Short Term Option Series. BZX Options does not believe the proposed rule change will impose any burden on intermarket competition, as Phlx recently received Commission approval to list Monday SPY Expirations.\18\ BZX Options believes this proposed rule change is necessary to ensure fair competition among the options exchanges. Additionally, nothing prevents other options exchange from proposing similar rules to list and trade short-term option series in SPY with Monday expirations. --------------------------------------------------------------------------- \18\ Id. --------------------------------------------------------------------------- (C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \19\ and Rule 19b-4(f)(6) thereunder.\20\ --------------------------------------------------------------------------- \19\ 15 U.S.C. 78s(b)(3)(A). \20\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intention to file 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. The Exchange has satisfied this requirement. --------------------------------------------------------------------------- A proposed rule change filed under Rule 19b-4(f)(6) normally does not become operative for 30 days from the date of filing. However, Rule 19b-4(f)(6)(iii) \21\ permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission notes that it recently approved Phlx's substantially similar proposal to list and trade Monday SPY Expirations.\22\ The Exchange has stated that waiver of the operative delay will allow the Exchange to list and trade Monday SPY Expirations as soon as possible, and therefore, promote competition among the option exchanges. For these reasons, the Commission believes that the proposed rule change presents no novel issues and that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest, and will allow the Exchange to remain competitive with other exchanges. Therefore, the Commission hereby waives the 30-day operative delay and designates the proposal operative upon filing.\23\ --------------------------------------------------------------------------- \21\ 17 CFR 240.19b-4(f)(6)(iii). \22\ See supra note 5. \23\ For purposes only of waiving the 30-day operative delay, the Commission has also considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). --------------------------------------------------------------------------- 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 proposal 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 rule-comments@sec.gov. Please include File No. SR-CboeBZX-2018-012 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 No. SR-CboeBZX-2018-012. 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 such filing will also be available for 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 No. SR-CboeBZX-2018-012 and should be submitted on or before March 16, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\24\ --------------------------------------------------------------------------- \24\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-03696 Filed 2-22-18; 8:45 am] BILLING CODE 8011-01-P
![8128 Federal Register / Vol. 83, No. 37 / Friday, February 23, 2018 / Notices
SECURITIES AND EXCHANGE (57) The term ‘‘Short Term Option series on the same class expire or, in the
COMMISSION Series’’ means a series in an option class case of Quarterly Options Series, on an
that is approved for listing and trading expiration that coincides with an
[Release No. 34–82735; File No. SR–
on the Exchange in which the series is expiration of Quarterly Options Series
CboeBZX–2018–012]
opened for trading on any Monday, on the same class.
Self-Regulatory Organizations; Cboe Tuesday, Wednesday, Thursday or
(c)–(f) (No change).
BZX Exchange, Inc.; Notice of Filing Friday that is a business day and that
expires on the Monday, Wednesday or (g) Monday and Wednesday SPY
and Immediate Effectiveness of a
Proposed Rule Change To Expand the Friday of the next business week, or, in Expirations. The Exchange may open for
Short Term Options Series Program To the case of a series that is listed on a trading on any Friday or Monday that is
Allow Monday Expirations for SPDR Friday and expires on a Monday, is a business day series of options on the
S&P 500 ETF Trust Options on the listed one business week and one SPDR S&P 500 ETF Trust (‘‘SPY’’) to
Exchange’s Equity Options Platform business day prior to that expiration. If expire on any Monday of the month that
a Tuesday, Wednesday, Thursday or is a business day and is not a Monday
February 16, 2018. Friday is not a business day, the series on which Quarterly Options Series
Pursuant to Section 19(b)(1) of the may be opened (or shall expire) on the expire (‘‘Monday SPY Expirations’’),
Securities Exchange Act of 1934 (the first business day immediately prior to provided that any Friday on which the
‘‘Act’’),1 and Rule 19b–4 thereunder,2 that Tuesday, Wednesday, Thursday or Exchange opens for trading a Monday
notice is hereby given that on February Friday, respectively. For a series listed SPY Expiration is one business week
15, 2018, Cboe BZX Exchange, Inc. (the pursuant to this section for Monday and one business day prior to
‘‘Exchange’’ or ‘‘BZX Options’’) filed expiration, if a Monday is not a business expiration. The Exchange may also
with the Securities and Exchange day, the series shall expire on the first
open for trading on any Tuesday or
Commission (‘‘Commission’’) the business day immediately following that
Wednesday that is a business day series
proposed rule change as described in Monday.
(58)–(63) (No change). of SPY options [on the SPDR S&P 500
Items I and II below, which Items have
Interpretations and Policies ETF Trust (‘‘SPY’’)] to expire on any
been prepared by the Exchange. The
Exchange has designated this proposal .01 (No change). Wednesday of the month that is a
as a ‘‘non-controversial’’ proposed rule * * * * * business day and is not a Wednesday
change pursuant to Section 19(b)(3)(A) [i]on which Quarterly Options Series
Rule 19.6. Series of Options Contracts expire (‘‘Wednesday SPY Expirations’’).
of the Act 3 and Rule 19b–4(f)(6)(iii) Open for Trading
thereunder,4 which renders it effective The Exchange may list up to five
upon filing with the Commission. The (a)–(g) (No change). consecutive Monday SPY Expirations
Commission is publishing this notice to Interpretations and Policies and up to five consecutive Wednesday
solicit comments on the proposed rule SPY Expirations at one time; the
.01–.04 (No change). Exchange may have no more than a total
change from interested persons. .05 After an option class has been
of five Monday SPY Expirations and no
I. Self-Regulatory Organization’s approved for listing and trading on BZX
Options, the Exchange may open for more than a total of five Wednesday
Statement of the Terms of Substance of
trading on any Thursday or Friday that SPY Expirations. Monday and
the Proposed Rule Change
is a business day (‘‘Short Term Option Wednesday SPY Expirations will be
The Exchange filed a proposal to subject to the provisions of this Rule.
Opening Date’’) series of options on that
expand the Short Term Options Series
class that expire on each of the next five .06–.07 (No change).
Program to allow Monday expirations
(5) Fridays that are business days and * * * * *
for SPDR S&P 500 ETF Trust (‘‘SPY’’)
are not Fridays in which monthly
options. The text of the proposed rule change
options series or Quarterly Options
(additions are italicized; deletions are Series expire (‘‘Short Term Option is available at the Exchange’s website at
[bracketed]) Expiration Dates’’). The Exchange may www.markets.cboe.com, at the principal
have no more than a total of five Short office of the Exchange, and at the
* * * * * Commission’s Public Reference Room.
Term Option Expiration Dates, not
Rules of Cboe BZX Exchange, Inc. including any Monday or Wednesday II. Self-Regulatory Organization’s
* * * * * SPY Expirations as provided in Statement of the Purpose of, and
paragraph (g) below. If BZX Options is Statutory Basis for, the Proposed Rule
Rule 16.1. Definitions not open for business on the respective
Change
(a) With respect to the Rules Thursday or Friday, the Short Term
contained in Chapters XVI to XXIX Option Opening Date will be the first In its filing with the Commission, the
below, relating to the trading of options business day immediately prior to that Exchange included statements
contracts on the Exchange, the following respective Thursday or Friday. concerning the purpose of and basis for
terms shall have the meanings specified Similarly, if BZX Options is not open the proposed rule change and discussed
in this Rule. A term defined elsewhere for business on the Friday that the any comments it received on the
in the Exchange Rules shall have the options are set to expire, the Short Term proposed rule change. The text of these
same meaning with respect to this Option Expiration Date will be the first statements may be examined at the
Chapter XVI, unless otherwise defined business day immediately prior to that
daltland on DSKBBV9HB2PROD with NOTICES
places specified in Item IV below. The
below. Friday. Regarding Short Term Option
Exchange has prepared summaries, set
(1)–(56) (No change). Series:
(a) (No change). forth in Sections A, B, and C below, of
1 15 (b) With the exception of Monday and the most significant parts of such
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4. Wednesday SPY Expirations, no Short statements.
3 15 U.S.C. 78s(b)(3)(A). Term Option Series may expire in the
4 17 CFR 240.19b–4(f)(6)(iii). same week in which monthly option
VerDate Sep<11>2014 18:52 Feb 22, 2018 Jkt 244001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 E:\FR\FM\23FEN1.SGM 23FEN1](https://thefederalregister.org/doc/83_FR_8165/page/1.svg)
![Federal Register / Vol. 83, No. 37 / Friday, February 23, 2018 / Notices 8131
Monday expirations pursuant to its proposal to list and trade Monday SPY internet website (http://www.sec.gov/
nonstandard expirations pilot program. Expirations.22 The Exchange has stated rules/sro.shtml). Copies of the
BZX Options does not believe the that waiver of the operative delay will submission, all subsequent
proposed rule change will impose any allow the Exchange to list and trade amendments, all written statements
burden on intramarket competition, as Monday SPY Expirations as soon as with respect to the proposed rule
all market participants will be treated in possible, and therefore, promote change that are filed with the
the same manner as they are with competition among the option Commission, and all written
respect to existing Short Term Option exchanges. For these reasons, the communications relating to the
Series. BZX Options does not believe Commission believes that the proposed proposed rule change between the
the proposed rule change will impose rule change presents no novel issues Commission and any person, other than
any burden on intermarket competition, and that waiver of the 30-day operative those that may be withheld from the
as Phlx recently received Commission delay is consistent with the protection public in accordance with the
approval to list Monday SPY of investors and the public interest, and provisions of 5 U.S.C. 552, will be
Expirations.18 BZX Options believes will allow the Exchange to remain available for website viewing and
this proposed rule change is necessary competitive with other exchanges. printing in the Commission’s Public
to ensure fair competition among the Therefore, the Commission hereby Reference Room, 100 F Street, NE,
options exchanges. Additionally, waives the 30-day operative delay and Washington, DC 20549, on official
nothing prevents other options designates the proposal operative upon business days between the hours of
exchange from proposing similar rules filing.23 10:00 a.m. and 3:00 p.m. Copies of such
to list and trade short-term option series At any time within 60 days of the filing will also be available for
in SPY with Monday expirations. filing of the proposed rule change, the inspection and copying at the principal
Commission summarily may office of the Exchange. All comments
(C) Self-Regulatory Organization’s temporarily suspend such rule change if received will be posted without change.
Statement on Comments on the it appears to the Commission that such Persons submitting comments are
Proposed Rule Change Received From
action is necessary or appropriate in the cautioned that we do not redact or edit
Members, Participants or Others
public interest, for the protection of personal identifying information from
The Exchange neither solicited nor investors, or otherwise in furtherance of comment submissions. You should
received comments on the proposed the purposes of the Act. If the submit only information that you wish
rule change. Commission takes such action, the to make available publicly. All
III. Date of Effectiveness of the Commission shall institute proceedings submissions should refer to File No.
Proposed Rule Change and Timing for to determine whether the proposed rule SR–CboeBZX–2018–012 and should be
Commission Action should be approved or disapproved. submitted on or before March 16, 2018.
Because the foregoing proposed rule IV. Solicitation of Comments For the Commission, by the Division of
Trading and Markets, pursuant to delegated
change does not: (i) Significantly affect Interested persons are invited to authority.24
the protection of investors or the public submit written data, views and Eduardo A. Aleman,
interest; (ii) impose any significant arguments concerning the foregoing,
burden on competition; and (iii) become Assistant Secretary.
including whether the proposal is
operative for 30 days from the date on [FR Doc. 2018–03696 Filed 2–22–18; 8:45 am]
consistent with the Act. Comments may
which it was filed, or such shorter time be submitted by any of the following BILLING CODE 8011–01–P
as the Commission may designate, the methods:
proposed rule change has become
effective pursuant to Section 19(b)(3)(A) Electronic Comments SECURITIES AND EXCHANGE
of the Act 19 and Rule 19b–4(f)(6) • Use the Commission’s internet COMMISSION
thereunder.20 comment form (http://www.sec.gov/ Submission for OMB Review;
A proposed rule change filed under rules/sro.shtml); or Comment Request
Rule 19b–4(f)(6) normally does not • Send an email to rule-comments@
become operative for 30 days from the sec.gov. Please include File No. SR– Upon Written Request, Copies Available
date of filing. However, Rule 19b– CboeBZX–2018–012 on the subject line. From: Securities and Exchange
4(f)(6)(iii) 21 permits the Commission to Commission, Office of FOIA Services,
designate a shorter time if such action Paper Comments 100 F Street NE, Washington, DC
is consistent with the protection of • Send paper comments in triplicate 20549–2736
investors and the public interest. The to Secretary, Securities and Exchange Extension:
Exchange has asked the Commission to Commission, 100 F Street NE, Form 2–E under Rule 609; SEC File No.
waive the 30-day operative delay so that Washington, DC 20549–1090. 270–222, OMB Control No. 3235–0233
the proposal may become operative All submissions should refer to File No. Notice is hereby given that, pursuant
immediately upon filing. The SR–CboeBZX–2018–012. This file to the Paperwork Reduction Act of 1995
Commission notes that it recently number should be included on the (44 U.S.C. 3501 et seq.), the Securities
approved Phlx’s substantially similar subject line if email is used. To help the and Exchange Commission (the
Commission process and review your ‘‘Commission’’) has submitted to the
18 Id.
comments more efficiently, please use Office of Management and Budget
19 15 U.S.C. 78s(b)(3)(A). only one method. The Commission will (‘‘OMB’’) a request for extension of the
daltland on DSKBBV9HB2PROD with NOTICES
20 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
post all comments on the Commission’s previously approved collection of
the Commission written notice of its intention to information discussed below.
file the proposed rule change at least five business 22 See supra note 5. Rule 609 (17 CFR 230.609) under the
days prior to the date of filing of the proposed rule 23 For purposes only of waiving the 30-day
change, or such shorter time as designated by the
Securities Act of 1933 (15 U.S.C. 77a et
operative delay, the Commission has also
Commission. The Exchange has satisfied this considered the proposed rule’s impact on seq.) requires small business investment
requirement. efficiency, competition, and capital formation. See
21 17 CFR 240.19b–4(f)(6)(iii). 15 U.S.C. 78c(f). 24 17 CFR 200.30–3(a)(12).
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Document Created: 2018-02-23 01:32:25
Document Modified: 2018-02-23 01:32:25
| 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 8128 |
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