I. Introduction

On October 21, 2014, NYSE Arca, Inc. (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) ^[1] and Rule 19b-4 thereunder,^[2] a proposed rule change to reflect certain changes to the description of the Guggenheim Enhanced Short Duration ETF (“Fund”), a series of Claymore Exchange-Traded Fund Trust (“Trust”).^[3] On October 29, 2014, the Exchange filed Amendment No. 1 to the proposed rule change. The proposed rule change, as modified by Amendment No. 1 thereto, was published for comment in the Federal Register on November 7, 2014.^[4] The Commission received one comment on the proposal.^[5] On December 10, 2014, the Commission designated a longer period within which to approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether to disapprove the proposed rule change.^[6] On February 3, 2015, the Commission instituted proceedings to determine whether to approve or disapprove the proposed rule change.^[7] On March 16, 2015, the Exchange filed Amendment No. 2 to the proposed rule change,^[8] and on March 24, 2015, the Exchange filed Amendment No. 3 to the ( printed page 24987) proposed rule change.^[9] The Commission is publishing this notice to solicit comments on Amendments Nos. 2 and 3 from interested persons, and is approving the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, on an accelerated basis.

II. The Exchange's Description of the Proposal

The Exchange proposes to reflect certain changes to the measures that Guggenheim Funds Investment Advisors, LLC (“Adviser”) may use to implement the Fund's investment objective, which is to seek maximum current income, consistent with preservation of capital and daily liquidity.^[10]

First, the Prior Release stated that the Fund may invest up to 10% of its assets in mortgage-backed securities (“MBS”) or in other asset-backed securities (“ABS”).^[11] The Exchange proposes to modify this limitation to permit the Fund to invest up to 20% of its assets in MBS and ABS that are privately-issued, non-agency, and non-government sponsored entity (“Private MBS/ABS”). The Exchange notes that the holdings in Private MBS/ABS would be subject to the respective limitations on the Fund's investments in illiquid assets and high yield securities, as described below. According to the Exchange, this change to the Fund's investment limitations would allow the Adviser to better achieve the Fund's investment objective to seek maximum current income, consistent with preservation of capital and daily liquidity. In addition, the Exchange represents that the Fund's increased investment in Private MBS/ABS will continue to adhere to the Fund's investment strategy of investing in short duration, fixed income securities. The Exchange further notes that, because the Fund may invest no more than 10% of its net assets in high yield securities, the preponderance of the Fund's investments in Private MBS/ABS will be in investment grade instruments. Due to the quality of Private MBS/ABS in which the Fund will invest, the Exchange states that the Fund's additional investments in Private MBS/ABS should not expose the Fund to additional liquidity risk.

Second, the Prior Release stated that the Fund may invest up to an aggregate amount of 15% of its net assets in: (1) Illiquid securities; and (2) Rule 144A securities. The Exchange proposes to modify this limitation and permit the Fund to hold up to an aggregate amount of 15% of its net assets in illiquid assets (calculated at the time of investment),^[12] including Rule 144A securities deemed illiquid by the Adviser, consistent with Commission guidance. According to the Exchange, the Adviser and the Trust's Board of Trustees will continue to evaluate each Rule 144A security based on the Fund's valuation procedures to oversee liquidity and valuation concerns. With respect to investment in illiquid assets, if changes in the values of the Fund's assets cause the Fund's holdings of illiquid assets to exceed the 15% limitation (as if liquid assets have become illiquid), the Fund will take such actions as it deems appropriate and practicable to attempt to reduce its holdings of illiquid assets.

Third, the Prior Release stated that the Fund primarily will invest in U.S. dollar-denominated, investment grade debt securities rated Baa or higher by Moody's Investors Service, Inc. (“Moody's”), or equivalently rated by Standard & Poor's Rating Group (“S&P”) or Fitch Investor Services (“Fitch”), or, if unrated, determined by the Adviser to be of comparable quality. The Exchange proposes to modify this representation, as described above, to a representation that the Fund primarily will invest in U.S. dollar-denominated, investment grade debt securities rated Baa3 or higher by Moody's,^[13] or equivalently rated by S&P, Fitch, or by any other nationally recognized statistical rating organizations, or, if unrated, determined by the Adviser to be of comparable quality.

Fourth, the Prior Release stated that the Fund will invest at least 80% of its net assets in fixed income securities. The Fund proposes to modify this statement to permit the Fund to invest at least 80% of its net assets in fixed income securities and in exchange-traded funds (“ETFs”) and closed-end funds that invest substantially all of their assets in fixed income securities.^[14] The Exchange represents that the shares of these ETFs and closed-end funds will be listed on a U.S. national securities exchange.

The Exchange represents that there is no change to the Fund's investment objective, and that the Fund will continue to comply with all initial and continued listing requirements under NYSE Arca Equities Rule 8.600. In addition, the Exchange represents that, except for the changes noted above, all other facts presented and representations made in the Prior Release remain unchanged.^[15]

Additional information regarding the Trust, Fund, and the Shares, including investment strategies, risks, creation and redemption procedures, fees, portfolio holdings disclosure policies, trading halts, dissemination and availability of information, distributions, and taxes can be found in the Prior Release, Notice, as modified by Amendment Nos. 1, 2, and 3, and the registration statement, as applicable.^[16]

III. Discussion and Commission's Findings

After careful review, the Commission finds that the proposed rule change is consistent with the requirements of Section 6 of the Act ^[17] and the rules and ( printed page 24988) regulations thereunder applicable to a national securities exchange.^[18] In particular, the Commission finds that the proposal is consistent with Section 6(b)(5) of the Act,^[19] which requires, among other things, that the Exchange's rules be designed to promote just and equitable principles of trade, 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.

The Commission believes that the changes proposed by the Exchange with respect to the Fund are consistent with the listing standards applicable to other existing ETFs. Specifically, the Commission notes that, with respect to proposals to list and trade other Managed Fund Shares on the Exchange, it has previously approved similar limitations on MBS and ABS holdings and on illiquid assets.^[20] The Commission also notes that it has previously approved the listing and trading of other series of Managed Fund Shares based on portfolios comprising fixed income securities of any credit rating, including investment grade securities rated Baa3 or higher,^[21] and shares of other ETFs and exchange-traded closed-end funds.^[22]

In support of its proposal, the Exchange has made the following representations:

(1) The Fund and the Shares are currently in compliance with the listing standards and other rules of the Exchange and the requirements set forth in the Prior Release.

(2) The Fund will continue to comply with all initial and continued listing requirements under NYSE Arca Equities Rule 8.600, which sets forth the initial and continued listing criteria applicable to Managed Fund Shares.

(3) There is no change to the Fund's investment objective.

(4) Except for the changes noted above, all other facts presented and representations made in the Prior Release remain unchanged.

This approval order is based on all of the Exchange's representations, including those set forth above; in the Notice, as modified by Amendment No. 1 thereto; in Amendment Nos. 2 and 3 to the proposed rule change; and in the Prior Release.

For the foregoing reasons, the Commission finds that the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, is consistent with Section 6(b)(5) of the Act ^[23] and the rules and regulations thereunder applicable to a national securities exchange.

IV. Solicitation of Comments on Amendment Nos. 2 and 3 to the Proposed Rule Change

Interested persons are invited to submit written data, views, and arguments concerning whether Amendment Nos. 2 and 3 to the proposed rule change are consistent with the Act. Comments may be submitted by any of the following methods:

Electronic Comments

• Use the Commission's Internet comment form (http://www.sec.gov/​rules/​sro.shtml); or
• Send an email torule-comments@sec.gov. Please include File Number SR-NYSEArca-2014-107 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.

V. Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1, 2, and 3

The Commission finds good cause to approve the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, prior to the thirtieth day after the date of publication of notice of the amendments in the Federal Register . Amendment Nos. 2 and 3 modify the proposed rule change by permitting the Fund to invest up to 20% of its assets in Private MBS/ABS. The Commission believes that the proposed rule change is consistent with the permitted allocation of such MBS and ABS holdings with respect to other issues of Managed Fund Shares previously approved by the Commission for Exchange listing and trading.^[24] Accordingly, the Commission finds good cause, pursuant to Section 19(b)(2) of the Act,^[25] to approve the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, on an accelerated basis.

VI. Conclusion

It is therefore ordered, pursuant to Section 19(b)(2) of the Act,^[26] that the proposed rule change (SR-NYSEArca-2014-107), as modified by Amendment Nos. 1, 2, and 3, be, and it hereby is, approved on an accelerated basis.

All submissions should refer to File Number SR-NYSEArca-2014-107. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site ( http://www.sec.gov/​rules/​sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public 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 inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2014-107 and should be submitted on or before May 22, 2015.