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 June 1, 2026, Chicago Mercantile Exchange Inc. (“CME” or “Exchange”) filed with the Securities and Exchange Commission (“SEC” or “Commission”) the proposed rule change described in Items I, II, and III below, which Items have been substantially prepared by CME. CME filed the proposed rule change pursuant to Section 19(b)(2) of the Act.^[3] The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

I. CME's Statement of the Terms and Substance of the Proposed Rule Change

CME's proposed rule change is filed as Exhibit 5 to this filing and consists of additions to Rule 930 in Chapter 9 of the CME Rulebook relating to customer performance bond requirements for security futures contracts that CME intends to list for trading. Each addition is described in more detail below. ( printed page 34694)

II. CME's Statement of the Purpose of, and Statutory Basis for the Proposed Rule Change

In its filing with the Commission, CME 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. CME has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.

A. CME's Statement of the Purpose of, and Statutory Basis for the Proposed Rule Change

1. Purpose

Background

CME is registered with the Commodity Futures Trading Commission (“CFTC”) as a designated contract market (“DCM”) and a derivatives clearing organization under the Commodity Exchange Act (“CEA”). On April 10, 2026, CME, in its capacity as a DCM, submitted a 1-N notice filing to the Securities and Exchange Commission (“SEC” or “Commission”) to register as a national securities exchange for security futures products pursuant to the notice registration provisions of Section 6(g) of the Securities Exchange Act of 1934, as amended (“Act” or “Exchange Act”).^[4] On April 29, 2026, the Commission issued a notice acknowledging receipt of such written notice and effectiveness of CME's notice registration as a national securities exchange contemporaneously with CME's submission of the 1-N notice on April 10, 2026.^[5]

CME was previously registered with the SEC as a national securities exchange pursuant to the notice registration provisions of the Act and offered physically-delivered single security futures contracts pursuant to that registration and its registration as a DCM. CME ceased offering those contracts for trading in March 2011 and its former notice-registration lapsed.^[6] Under its current notice-registration, CME plans to list cash-settled futures on individual equity securities for trading pursuant to listing standard rules for security futures products that it will adopt under a separate rule filing it will file in accordance with the filing procedures of Section 19(b)(7) of the Act ^[7] and Rule 19b-7 under the Act.^[8]

CME is submitting this proposed rule change in connection with its plans to list cash-settled single stock futures, to establish customer-level margin requirements for security futures that are consistent with current Commission (and CFTC) requirements, as described in the following section.

Description of the Proposed Rule Change

CME Rule 930 (Performance Bond Requirements; Account Holder Level) sets out customer-level performance bond requirements, also known as margin requirements, for positions in futures and options on futures contracts listed for trading on CME. The proposed rule change will revise Rule 930 to add margin requirements specific to security futures products that CME may from time-to-time list for trading. Specifically, the proposed revisions to Rule 930 will establish procedures relating to the determination and administration of customer margin requirements for security futures and the applicability of those requirements, specifically excluding qualifying security futures dealers from those requirements and related regulatory requirements. The proposed additions to Rule 930 largely reinstate the margin provisions for security futures that CME previously added to Rule 930, with some modifications to align with the Commission's (and CFTC's) current margin requirements for security futures and some non-substantive clarification changes to the prior text.

Performance Bond Rates. Proposed Rule 930.B.2.a. provides that customer performance bond rates shall be established at levels no lower than those prescribed by SEC Rule 242.403 and CFTC Regulation 41.45 or any successor regulations. Proposed Rule 930.B.2.c. elaborates by establishing the requisite performance bond level for each long or short position in a security future at 15% of the current market value of such security futures contract, or such other requirement as may be established by the SEC and CFTC for purposes of SEC Rule 242.403(b)(1) and CFTC Regulation 41.45(b)(1).

Proposed Rule 930.B.2.d. sets out exceptions to that 15% requirement as permitted under SEC Rule 242.403(b)(2) and CFTC Regulation 41.45(b)(2), which establish that a self-regulatory authority may set the required initial or maintenance performance bond level for offsetting positions involving security futures and related positions at a level lower than the level that would apply if performance bond requirements for such positions were calculated separately based on the aforementioned 15% requirement, provided the rules establishing such lower performance bond levels meet the criteria set forth in Section 7(c)(2)(B) of the Act. That Section requires that:

(I) The margin requirements for a security future product be consistent with the margin requirements for comparable option contracts traded on any exchange registered pursuant to [Section 6(a) of the Act]; and

(II) Initial and maintenance margin levels for a security future product not be lower than the lowest level of margin, exclusive of premium, required for any comparable option contract traded on any exchange registered pursuant to [Section 6(a) of the Act], other than an option on a security future.

Proposed Rule 930.B.2.d. includes a table that sets out in detail the performance bond offsets available with respect to particular combinations of security futures and related positions. The offset strategies in the table align with those the SEC and CFTC have acknowledged are permissible, as set forth in their joint 2020 release on Customer Margin Rules Relating to Security Futures (the “Customer Margin Release”).

Non-Customers. Proposed Rule 930.B.2.b. identifies “exempted persons” and “market makers” as non-customers for purposes of the proposed rule amendments. Those non-customers are, therefore, exempt from the application of such provisions. Exempted persons are specifically identified by reference to applicable SEC and CFTC Regulations.

Market Maker Exclusion. SEC Rule 242.400(c)(2)(v) and CFTC Regulation 41.42(c)(2)(v) permit exchanges to adopt rules containing specified requirements for security futures dealers, on the basis of which the financial relations between security futures intermediaries, on the one hand, and qualifying security futures dealers, on the other, are excluded from the customer performance bond requirements for security futures. Rules so adopted by an exchange must meet the criteria set forth in Section 7(c)(2)(B) of the Act. CME ( printed page 34695) proposes a market maker exclusion in its proposed Rule 930.B.2.b. consistent with the requirements of those provisions. To qualify for the market maker exclusion, a person must be a member of CME and registered as a dealer with the SEC under Section 15(b) of the Act.

A proposed market maker must also hold itself out as willing to buy and sell security futures for its own account on a regular or continuous basis. The proposed market maker exclusion provides three alternative ways for a person to satisfy this requirement. Under the first alternative, the market maker must (1) provide continuous two-sided quotations throughout the trading day for all delivery months of security futures contracts representing a meaningful proportion of the total trading volume of security futures contracts on the Exchange, subject to relaxation during unusual market conditions as determined by CME (such as a fast market in either a security futures contract or a security underlying a security futures contract) at which times the market maker must use its best efforts to quote continuously and competitively; and (2) when providing quotations, quote with a maximum bid/ask spread of no more than the greater of $0.20 or 150% of the bid/ask spread in the primary market for the security underlying each security futures contract. Beginning on the 181st calendar day after the commencement of trading of security futures contracts on the Exchange, a “meaningful proportion of the total trading volume of security futures contracts on the Exchange from time to time” shall mean a minimum of 20% of such trading volume.

Under the second alternative, the market maker must (1) respond to at least 75% of the requests for quotation for all delivery months of security futures contracts representing a meaningful proportion of the total trading volume of security futures contracts on the Exchange, subject to relaxation during unusual market conditions as determined by the CME (such as a fast market in either a security futures contract or a security underlying a security futures contract) at which times the Market Maker must use its best efforts to quote competitively; and (2) when responding to requests for quotation, quote within five seconds with a maximum bid/ask spread of no more than the greater of $0.20 or 150% of the bid/ask spread in the primary market for the security underlying each security futures contract. As with the first alternative, beginning on the 181st calendar day after the commencement of trading of security futures contracts on the Exchange, a “meaningful proportion of the total trading volume of security futures contracts on the Exchange from time to time” shall mean a minimum of 20% of such trading volume.

Under the third alternative, the market maker is assigned to a group of security futures contracts listed on the Exchange that is either unlimited in nature (“Unlimited Assignment”) or is assigned to no more than 20% of the security futures contracts listed on the Exchange (“Limited Assignment”). In addition, this alternative provides that: (a) At least 75% of the market maker's total trading activity in Exchange security futures contracts is in its assigned security futures contracts, measured on a quarterly basis; (b) during at least 50% of the trading day, the market maker has bids or offers in the market that are at or near the best market, except in unusual market conditions (such as a fast market in either a security futures contract or a security underlying a security futures contract), with respect to at least 25% (in the case of an Unlimited Assignment) or at least one (in the case of a Limited Assignment) of its assigned security futures contracts; and (c) the first two requirements are satisfied on at least 90% (in the case of an Unlimited Assignment) or 80% (in the case of a Limited Assignment, or in the case of either an Unlimited or Limited Assignment but where the Exchange is listing four or fewer security futures contracts) of the trading days in each calendar quarter.

Under the proposed revisions, market makers are required to maintain books and records including trading statements and other financial records that would evidence compliance with these standards. This recordkeeping requirement includes, without limitation, such trading statements and other financial records as may be necessary specifically to verify compliance. Failure on the part of a market maker to comply with these standards may result in revocation of security futures dealer status or other sanctions provided under CME Rules.

Performance Bond Administration. Proposed Rule 930.C.2.a identifies the types of performance bonds that a security futures intermediary may accept from a customer. Consistent with SEC Rule 242.404(b) and CFTC Regulation 41.46(b), acceptable types of performance bonds are limited to: deposits of cash, margin securities (subject to specified restrictions), exempted securities, any other assets permitted under Regulation T of the Board of Governors of the Federal Reserve System to satisfy a performance bond deficiency in a securities margin account, and any combination of the foregoing. Proposed Rule 930.C.2.a. further provides that the different types of eligible performance bonds are to be valued in accordance with the applicable principles set forth in SEC Rules 242.404(c) and 242.404(e) and CFTC Regulations 41.46(c) and 41.46(e).

Proposed Rule 930.C.2.b. provides that a security futures intermediary shall not accept as performance bond from any customer securities that have been issued by that customer or an affiliate of that customer unless the intermediary files a petition with and receives permission from the Exchange for such purpose. Proposed Rule 930.C.2.c. provides that all assets deposited by a customer to meet performance bond requirements must be and remain unencumbered by third-party claims against that customer.

Proposed Rule 930.K.2. requires a security futures intermediary to take the deduction required with respect to an underfunded account in computing its net capital under applicable SEC and CFTC Regulations if the customer has failed to comply with a required performance bond call within a reasonable period of time. This requirement is consistent with SEC Rule 242.406(a) and CFTC Regulation 41.48(a). Further, Proposed Rule 930.K.2. requires the liquidation of an account where there is a liquidating deficit, in accordance with SEC Rule 242.406(b) and CFTC Regulation 41.48(b).

2. Statutory Basis

CME's proposed rule change is consistent with Section 6(h)(3)(L) of the Act in conjunction with Section 7(c)(2)(B) of the Act, in that the proposed margin requirements for a security futures product will not be lower than the lowest level of margin (excluding premium) required for a comparable option contracts traded on any registered national securities exchange. The SEC has implemented this provision in Rule 242.403(b)(1) under the Act, which as revised in 2020 under the Customer Margin Release sets the minimum margin requirements for security futures at 15% of current market value (reduced from 20%). The CME's proposed revisions to CME Rule 930 follow that 15% standard and also follow the offset strategies recognized under the Customer Margin Release. Thus, CME's proposed rule change is consistent with Exchange Act Sections 6(h)(3)(L) and 7(c)(2)(B) and the SEC's current requirements implementing those statutory provisions. ( printed page 34696)

CME's proposed rule change is also consistent with Section 6(b)(5) of the Act in that it promotes competition and is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and to protect investors and the public interest. The CME believes that the proposed rule change is designed to accomplish these goals by permitting members to trade security futures contracts (as permitted under the Commission's rules and regulations) and by establishing the margin requirements to be not lower than the requirements under SEC and CFTC regulations.

B. CME's Statement on Burden on Competition

CME 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, because it will apply generally to market participants that will trade security futures that CME lists for trading and will not discriminate between market participants.

C. CME's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others

The Exchange has not solicited, and does not intend to solicit, comments on this 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 such 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 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-CME-2026-001 on the subject line.

Paper Comments

• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE, Washington, DC 20549.

All submissions should refer to File Number SR-CME-2026-001. 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 filing will be available for inspection and copying at the principal office of CME. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to File Number SR-CME-2026-001 and should be submitted on or before June 29, 2026.