Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Amending NYSE Arca Equities Rule 5.2(j)(6)(B)(I), the Generic Listing Standard for Equity Index-Linked Securities, 41147-41149 [E8-16350]

Download as PDF Federal Register / Vol. 73, No. 138 / Thursday, July 17, 2008 / Notices between the hours of 10 a.m. and 3 p.m. Copies of such 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–NYSE–2008–55 and should be submitted on or before August 7, 2008. 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: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Florence E. Harmon, Acting Secretary. [FR Doc. E8–16349 Filed 7–16–08; 8:45 am] Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSE–2008–55 on the subject line. mstockstill on PROD1PC66 with NOTICES the Commission,14 the proposal does not appear to present any novel regulatory issues. Therefore, the Commission designates the proposal operative upon filing.15 At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate 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 the furtherance of the purposes of the Act. SECURITIES AND EXCHANGE COMMISSION 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–NYSE–2008–55. This file number should be included on the subject line if e-mail 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 inspection and copying in the Commission’s Public Reference Room, 100 F Street, NE., Washington, DC 20549, on official business days 14 See supra, note 8. purposes only of waiving the operative delay of this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 15 For VerDate Aug<31>2005 21:03 Jul 16, 2008 Jkt 214001 BILLING CODE 8010–01–P [Release No. 34–58142; File No. SR– NYSEArca–2008–70] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Amending NYSE Arca Equities Rule 5.2(j)(6)(B)(I), the Generic Listing Standard for Equity IndexLinked Securities July 11, 2008. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’)1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 27, 2008, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’), through its wholly owned subsidiary, NYSE Arca Equities, Inc. (‘‘NYSE Arca Equities’’), filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend NYSE Arca Equities Rule 5.2(j)(6)(B)(I), the Exchange’s generic listing standard for equity index-linked securities (‘‘Equity Index-Linked Securities’’) to: (1) Eliminate initial and continued listing capitalization weighted and modified capitalization weighted index requirements; and (2) to adjust certain PO 00000 16 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. Frm 00122 Fmt 4703 Sfmt 4703 41147 equity index weighting criteria and adopt notional volume traded per month to both initial listing standards and continued listing standards. The text of the proposed rule change is available at the Exchange, the Commission’s Public Reference Room, and http://www.nyse.com. 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 aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose NYSE Arca proposes to amend NYSE Arca Equities Rule 5.2(j)(6)(B)(I), the Exchange’s generic listing standard for Equity Index-Linked Securities. Specifically, the Exchange proposes to: (1) Eliminate initial and continued listing capitalization weighted and modified capitalization weighted index requirements; and (2) to adjust certain equity index weighting criteria and adopt notional volume traded per month to both the initial listing standards and continued listing standards. For Equity Index-Linked Securities, the Exchange proposes to eliminate NYSE Arca Equities Rule 5.2(j)(6)(B)(I)(1)(b)(iii), the current initial listing requirement that, in the case of a capitalization weighted index or modified capitalization weighted index, the lesser of the five highest dollar weighted component securities in the index or the highest dollar weighted component securities in the index that in the aggregate represent at least 30% of the total number of component securities in the index, must have an average monthly trading volume of at least 2,000,000 shares over the previous six months. The Exchange also proposes to eliminate NYSE Arca Equities Rule 5.2(j)(6)(B)(I)(2)(a)(iii),3 the current 3 E-mail from Timothy J. Malinowski, Director, NYSE Euornext, to Michou H.M. Nguyen, Special Counsel, and Steve Varholik, Attorney-Advisor, Continued E:\FR\FM\17JYN1.SGM 17JYN1 41148 Federal Register / Vol. 73, No. 138 / Thursday, July 17, 2008 / Notices mstockstill on PROD1PC66 with NOTICES continued listing requirement, that in the case of a capitalization weighted index or modified capitalization weighted index, the lesser of the five highest dollar weighted component securities in the index or the highest dollar weighted component securities in the index that in the aggregate represent at least 30% of the total number of stocks in the index have an average monthly trading volume of at least 1,000,000 shares over the previous six months. The Exchange does not believe that it is consistent or justified to impose specific trading volume requirements applicable only to capitalization weighted or modified capitalization weighted indexes, since both of these index methodologies do not raise any unique characteristics that merit the application of the current initial and continued listing standard. Rather, the Exchange proposes that capitalization weighted index or modified capitalization weighted indexes comply with the initial and continued listing requirements currently applicable to all other equity indexes under NYSE Arca Equities Rule 5.2(j)(6)(B)(I) regardless of the index methodology. The Exchange notes that the Exchange’s exchange-traded fund (‘‘ETF’’) listing standard 4 does not impose equity index requirements on capitalization weighted and modified capitalization weighted indexes. Currently for initial listing, Rule 5.2(j)(6)(B)(I)(1)(b)(ii) provides that each component security of an equity index shall have trading volume in each of the last six months of not less than 1,000,000 shares per month, except that for each of the lowest weighted component securities in the index that in the aggregate account for no more than 10% of the weight of the index, the trading volume will be at least 500,000 shares per month in each of the last six months. The Exchange is proposing to: (i) Remove the requirement that each of the lowest weighted component securities in the index that in the aggregate account for 10% of the weight of the index have trading volume of at least 500,000 shares per month for each of the last six months; and (ii) adopt minimum global notional volume (‘‘Global Notional Volume’’) 5 traded per month Division of Trading and Markets, Commission, on July 10, 2008 (correcting the citations to NYSE Arca Equities Rules 5.2(j)(6)(B)(I)(2)(a)(iii) and 5.2(j)(6)(B)(I)(2)(a)(ii), respectively.) (‘‘July 10 e-mail’’). 4 See NYSE Arca Equities Rule 5.2(j)(3) Commentary .01. 5 Global Notional Volume is defined as the total shares traded globally times the price per share. VerDate Aug<31>2005 21:03 Jul 16, 2008 Jkt 214001 of $25,000,000 averaged over of the last six months as an option for meeting the listing requirements. Proposed Rule 5.2(j)(6)(B)(I)(1)(b)(ii) sets forth: Component stocks that in the aggregate account for at least 90% of the weight of the index each shall have a minimum global monthly trading volume of 1,000,000 shares, or minimum Global Notional Volume traded per month of $25,000,000, averaged over the last six months. With respect to the continued listing criteria, Rule 5.2(j)(6)(B)(I)(2)(a)(ii) 6 currently sets forth that the trading volume of each component security in the index must be at least 500,000 shares for each of the last six months, except that for each of the lowest weighted components in the index that in the aggregate account for no more than 10% of the weight of the index, trading volume must be at least 400,000 shares for each of the last six months. The Exchange is proposing to: (i) Remove the requirement that the lowest weighted component securities in the index that in the aggregate accounting for no more than 10% of the weight of the index have trading volume of at least 400,000 shares for each of the last six months; and (ii) adopt minimum Global Notional Volume traded per month of $12,500,000 averaged over the last six months as an option for satisfying the continued listing requirements. Proposed Rule 5.2(j)(6)(B)(I)(2)(ii) sets forth: Component stocks that in the aggregate account for at least 90% of the weight of the index each shall have a minimum global monthly trading volume of 500,000 shares, or minimum Global Notional Volume traded per month of $12,500,000, averaged over the last six months. With respect to both the initial listing and continued listing standards, the Exchange believes that considering the weighting of the bottom 10% component securities is insignificant for determining the liquidity of the index. Rather, the Exchange proposes that focusing on 90% of the top weighted index component securities is a better indication as to whether the index or indexes has sufficient liquidity for listing and trading of the related Equity Index-Linked Security. With respect to adopting, as an alternative to monthly trading volume, the minimum Global Notional Volume traded averaged over the last six months to both the initial and continued listing standards, the Exchange believes that averaged notional volume traded per month is a better measure of the liquidity of component stocks of the underlying index or indexes. PO 00000 6 See July 10 e-mail supra note 3. Frm 00123 Fmt 4703 Sfmt 4703 Specifically, notional volume nullifies the volume discrepancies that generally occur between low-priced and highpriced stocks.7 In addition, adopting an average of the trading volume and notional volume over six months eliminates seasonal volume fluctuations that may occur in the trading volume of a particular underlying security represented in the index or indexes.8 Further, investors, Equity IndexLinked Securities issuers, and thirdparty index sponsors would also benefit from NYSE Arca’s ability to list— without the delay associated with a stand-alone rule filing—Equity IndexLinked Securities based on a broader group of indexes, promoting competition. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,9 in general, and furthers the objectives of Section 6(b)(5) of the Act,10 in particular, in that it is 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 facilitating transactions in securities, and to remove impediments to and perfect the mechanisms of a free and open market and a national market system, and, in general, to protect investors and the public interest. The Exchange believes that the proposed rules applicable to trading pursuant to generic listing and trading criteria, together with the Exchange’s surveillance procedures applicable to trading in the securities covered by the proposed rules, serve to foster investor protection. 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 purposes of the Act. 7 For example, a stock priced at $10 per share that trades 2,500,000 shares in a month has a notional volume of $25,000,000. Conversely, a stock priced at $100 per share that trades 250,000 shares in a month has a notional volume of $25,000,000. 8 See July 10 e-mail supra note 3 (clarifying that the adoption of six month average applies to both trading volume and Global Notional Volume traded). 9 15 U.S.C. 78f. 10 15 U.S.C. 78f(b)(5). E:\FR\FM\17JYN1.SGM 17JYN1 Federal Register / Vol. 73, No. 138 / Thursday, July 17, 2008 / Notices 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 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reason for so finding or (ii) as to which the Exchange consents, the Commission will: A. By order approve 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 mstockstill on PROD1PC66 with NOTICES • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSEArca–2008–70 on the subject line. public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission’s Public Reference Room, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 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–2008–70 and should be submitted on or before August 7, 2008. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.11 Florence E. Harmon, Acting Secretary. [FR Doc. E8–16350 Filed 7–16–08; 8:45 am] BILLING CODE 8010–01–P DEPARTMENT OF STATE [Public Notice 6299] Bureau of Educational and Cultural Affairs (ECA) Request for Grant Proposals: Study of the United States Institute on U.S. National Security Policymaking in a Post 9/11 World Announcement Type: New Cooperative Agreement. Funding Opportunity Number: ECA/ A/E/USS–09–01. Catalog of Federal Domestic Assistance Number: 19.418. Paper Comments Key Dates: • Send paper comments in triplicate Application Deadline: September 17, to Secretary, Securities and Exchange 2008. Commission, 100 F Street, NE., Executive Summary: The Branch for Washington, DC 20549–1090. the Study of the U.S., Office of All submissions should refer to File Academic Exchange Programs, Bureau Number SR–NYSEArca–2008–70. This of Educational and Cultural Affairs file number should be included on the (ECA/A/E/USS), invites proposal subject line if e-mail is used. To help the submissions for the design and Commission process and review your implementation of the Study of the comments more efficiently, please use United States Institute on U.S. National only one method. The Commission will Security Policymaking in a Post 9/11 post all comments on the Commission’s World. This institute will provide a Internet Web site (http://www.sec.gov/ multinational group of up to 18 rules/sro.shtml). Copies of the experienced foreign university submission, all subsequent educators and other professionals with amendments, all written statements a deeper understanding of U.S. with respect to the proposed rule approaches to national security change that are filed with the policymaking, past and present, in order Commission, and all written to strengthen curricula and to improve communications relating to the the quality of teaching about the United proposed rule change between the States at universities and other Commission and any person, other than 11 17 CFR 200.30–3(a)(12). those that may be withheld from the VerDate Aug<31>2005 21:03 Jul 16, 2008 Jkt 214001 PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 41149 institutions abroad. The institute should be an intensive, academically rigorous program for scholars and other professionals from outside the United States, and should have a central theme and a strong contemporary component. It is anticipated that this grant will be awarded on or about October 15, 2008, pending the availability of funds. This six-week program, to be conducted during the winter of 2009, must include a four-week academic residency segment at a U.S. college or university campus (or other appropriate U.S. location) and a two-week study tour segment that complements the academic residency segment. The study tour segment must include a visit to Washington, D.C. that involves substantive briefings by national security policy professionals from the Department of State, other relevant U.S. government agencies, and private institutions. I. Funding Opportunity Description Authority Overall grant making authority for this program is contained in the Mutual Educational and Cultural Exchange Act of 1961, Pub. L. 87–256, as amended, also known as the Fulbright-Hays Act. The purpose of the Act is ‘‘to enable the Government of the United States to increase mutual understanding between the people of the United States and the people of other countries * * *; to strengthen the ties which unite us with other nations by demonstrating the educational and cultural interests, developments, and achievements of the people of the United States and other nations * * * and thus to assist in the development of friendly, sympathetic and peaceful relations between the United States and the other countries of the world.’’ The funding authority for the program above is provided through legislation. Purpose: The Bureau is seeking a detailed proposal for a Study of the United States (U.S.) Institute on U.S. National Security issues from colleges, universities, consortia of colleges and universities, and other not-for-profit academic organizations that have an established reputation in one or more of the following fields: Political science, international relations, law, military science, and/or other disciplines or subdisciplines related to the program themes. The institute should be organized around a central theme or themes in U.S. national security policy planning and formulation and should illuminate contemporary political, social, and economic debates in American society. E:\FR\FM\17JYN1.SGM 17JYN1

Agencies

[Federal Register Volume 73, Number 138 (Thursday, July 17, 2008)]
[Notices]
[Pages 41147-41149]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-16350]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58142; File No. SR-NYSEArca-2008-70]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
of Proposed Rule Change Amending NYSE Arca Equities Rule 
5.2(j)(6)(B)(I), the Generic Listing Standard for Equity Index-Linked 
Securities

 July 11, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'')\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on June 27, 2008, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange''), 
through its wholly owned subsidiary, NYSE Arca Equities, Inc. (``NYSE 
Arca Equities''), filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange. 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.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend NYSE Arca Equities Rule 
5.2(j)(6)(B)(I), the Exchange's generic listing standard for equity 
index-linked securities (``Equity Index-Linked Securities'') to: (1) 
Eliminate initial and continued listing capitalization weighted and 
modified capitalization weighted index requirements; and (2) to adjust 
certain equity index weighting criteria and adopt notional volume 
traded per month to both initial listing standards and continued 
listing standards. The text of the proposed rule change is available at 
the Exchange, the Commission's Public Reference Room, and http://
www.nyse.com.

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 aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    NYSE Arca proposes to amend NYSE Arca Equities Rule 
5.2(j)(6)(B)(I), the Exchange's generic listing standard for Equity 
Index-Linked Securities. Specifically, the Exchange proposes to: (1) 
Eliminate initial and continued listing capitalization weighted and 
modified capitalization weighted index requirements; and (2) to adjust 
certain equity index weighting criteria and adopt notional volume 
traded per month to both the initial listing standards and continued 
listing standards.
    For Equity Index-Linked Securities, the Exchange proposes to 
eliminate NYSE Arca Equities Rule 5.2(j)(6)(B)(I)(1)(b)(iii), the 
current initial listing requirement that, in the case of a 
capitalization weighted index or modified capitalization weighted 
index, the lesser of the five highest dollar weighted component 
securities in the index or the highest dollar weighted component 
securities in the index that in the aggregate represent at least 30% of 
the total number of component securities in the index, must have an 
average monthly trading volume of at least 2,000,000 shares over the 
previous six months. The Exchange also proposes to eliminate NYSE Arca 
Equities Rule 5.2(j)(6)(B)(I)(2)(a)(iii),\3\ the current

[[Page 41148]]

continued listing requirement, that in the case of a capitalization 
weighted index or modified capitalization weighted index, the lesser of 
the five highest dollar weighted component securities in the index or 
the highest dollar weighted component securities in the index that in 
the aggregate represent at least 30% of the total number of stocks in 
the index have an average monthly trading volume of at least 1,000,000 
shares over the previous six months.
---------------------------------------------------------------------------

    \3\ E-mail from Timothy J. Malinowski, Director, NYSE Euornext, 
to Michou H.M. Nguyen, Special Counsel, and Steve Varholik, 
Attorney-Advisor, Division of Trading and Markets, Commission, on 
July 10, 2008 (correcting the citations to NYSE Arca Equities Rules 
5.2(j)(6)(B)(I)(2)(a)(iii) and 5.2(j)(6)(B)(I)(2)(a)(ii), 
respectively.) (``July 10 e-mail'').
---------------------------------------------------------------------------

    The Exchange does not believe that it is consistent or justified to 
impose specific trading volume requirements applicable only to 
capitalization weighted or modified capitalization weighted indexes, 
since both of these index methodologies do not raise any unique 
characteristics that merit the application of the current initial and 
continued listing standard. Rather, the Exchange proposes that 
capitalization weighted index or modified capitalization weighted 
indexes comply with the initial and continued listing requirements 
currently applicable to all other equity indexes under NYSE Arca 
Equities Rule 5.2(j)(6)(B)(I) regardless of the index methodology.
    The Exchange notes that the Exchange's exchange-traded fund 
(``ETF'') listing standard \4\ does not impose equity index 
requirements on capitalization weighted and modified capitalization 
weighted indexes.
---------------------------------------------------------------------------

    \4\ See NYSE Arca Equities Rule 5.2(j)(3) Commentary .01.
---------------------------------------------------------------------------

    Currently for initial listing, Rule 5.2(j)(6)(B)(I)(1)(b)(ii) 
provides that each component security of an equity index shall have 
trading volume in each of the last six months of not less than 
1,000,000 shares per month, except that for each of the lowest weighted 
component securities in the index that in the aggregate account for no 
more than 10% of the weight of the index, the trading volume will be at 
least 500,000 shares per month in each of the last six months.
    The Exchange is proposing to: (i) Remove the requirement that each 
of the lowest weighted component securities in the index that in the 
aggregate account for 10% of the weight of the index have trading 
volume of at least 500,000 shares per month for each of the last six 
months; and (ii) adopt minimum global notional volume (``Global 
Notional Volume'') \5\ traded per month of $25,000,000 averaged over of 
the last six months as an option for meeting the listing requirements. 
Proposed Rule 5.2(j)(6)(B)(I)(1)(b)(ii) sets forth:
---------------------------------------------------------------------------

    \5\ Global Notional Volume is defined as the total shares traded 
globally times the price per share.

    Component stocks that in the aggregate account for at least 90% 
of the weight of the index each shall have a minimum global monthly 
trading volume of 1,000,000 shares, or minimum Global Notional 
Volume traded per month of $25,000,000, averaged over the last six 
---------------------------------------------------------------------------
months.

    With respect to the continued listing criteria, Rule 
5.2(j)(6)(B)(I)(2)(a)(ii) \6\ currently sets forth that the trading 
volume of each component security in the index must be at least 500,000 
shares for each of the last six months, except that for each of the 
lowest weighted components in the index that in the aggregate account 
for no more than 10% of the weight of the index, trading volume must be 
at least 400,000 shares for each of the last six months.
---------------------------------------------------------------------------

    \6\ See July 10 e-mail supra note 3.
---------------------------------------------------------------------------

    The Exchange is proposing to: (i) Remove the requirement that the 
lowest weighted component securities in the index that in the aggregate 
accounting for no more than 10% of the weight of the index have trading 
volume of at least 400,000 shares for each of the last six months; and 
(ii) adopt minimum Global Notional Volume traded per month of 
$12,500,000 averaged over the last six months as an option for 
satisfying the continued listing requirements. Proposed Rule 
5.2(j)(6)(B)(I)(2)(ii) sets forth:

    Component stocks that in the aggregate account for at least 90% 
of the weight of the index each shall have a minimum global monthly 
trading volume of 500,000 shares, or minimum Global Notional Volume 
traded per month of $12,500,000, averaged over the last six months.

    With respect to both the initial listing and continued listing 
standards, the Exchange believes that considering the weighting of the 
bottom 10% component securities is insignificant for determining the 
liquidity of the index. Rather, the Exchange proposes that focusing on 
90% of the top weighted index component securities is a better 
indication as to whether the index or indexes has sufficient liquidity 
for listing and trading of the related Equity Index-Linked Security.
    With respect to adopting, as an alternative to monthly trading 
volume, the minimum Global Notional Volume traded averaged over the 
last six months to both the initial and continued listing standards, 
the Exchange believes that averaged notional volume traded per month is 
a better measure of the liquidity of component stocks of the underlying 
index or indexes. Specifically, notional volume nullifies the volume 
discrepancies that generally occur between low-priced and high-priced 
stocks.\7\ In addition, adopting an average of the trading volume and 
notional volume over six months eliminates seasonal volume fluctuations 
that may occur in the trading volume of a particular underlying 
security represented in the index or indexes.\8\
---------------------------------------------------------------------------

    \7\ For example, a stock priced at $10 per share that trades 
2,500,000 shares in a month has a notional volume of $25,000,000. 
Conversely, a stock priced at $100 per share that trades 250,000 
shares in a month has a notional volume of $25,000,000.
    \8\ See July 10 e-mail supra note 3 (clarifying that the 
adoption of six month average applies to both trading volume and 
Global Notional Volume traded).
---------------------------------------------------------------------------

    Further, investors, Equity Index-Linked Securities issuers, and 
third-party index sponsors would also benefit from NYSE Arca's ability 
to list--without the delay associated with a stand-alone rule filing--
Equity Index-Linked Securities based on a broader group of indexes, 
promoting competition.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\9\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\10\ in particular, in that it 
is 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 facilitating 
transactions in securities, and to remove impediments to and perfect 
the mechanisms of a free and open market and a national market system, 
and, in general, to protect investors and the public interest. The 
Exchange believes that the proposed rules applicable to trading 
pursuant to generic listing and trading criteria, together with the 
Exchange's surveillance procedures applicable to trading in the 
securities covered by the proposed rules, serve to foster investor 
protection.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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 purposes of the Act.

[[Page 41149]]

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 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reason for so finding or (ii) as to 
which the Exchange consents, the Commission will:
    A. By order approve 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 e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2008-70 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-2008-70. This 
file number should be included on the subject line if e-mail 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 inspection 
and copying in the Commission's Public Reference Room, 100 F Street, 
NE., Washington, DC 20549, on official business days between the hours 
of 10 a.m. and 3 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-2008-70 and should 
be submitted on or before August 7, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
Florence E. Harmon,
Acting Secretary.
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    \11\ 17 CFR 200.30-3(a)(12).
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[FR Doc. E8-16350 Filed 7-16-08; 8:45 am]
BILLING CODE 8010-01-P