Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Approval of Proposed Rule Change To Permit $1 Strikes for MNX Options, 68464-68465 [E8-27280]

Download as PDF 68464 Federal Register / Vol. 73, No. 223 / Tuesday, November 18, 2008 / Notices to comments and suggestions submitted in writing within 60 days of this publication. Please direct your written comments to Lewis W. Walker, Acting Director/ CIO, Securities and Exchange Commission, C/O Shirley Martinson, 6432 General Green Way, Alexandria, VA 22312; or send an e-mail to: PRA_Mailbox@sec.gov. Dated: November 10, 2008. Florence E. Harmon, Acting Secretary. [FR Doc. E8–27429 Filed 11–17–08; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon written request, copies available from: Securities and Exchange Commission, Office of Filings and Information Services, Washington, DC 20549. dwashington3 on PRODPC61 with NOTICES Extension: Form N–2; SEC File No. 270–21; OMB Control No. 3235–0026. Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) the Securities and Exchange Commission (the ‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. The title for the collection of information is ‘‘Form N–2 (17 CFR 239.14 and 274.11a–1) under the Securities Act of 1933 and under the Investment Company Act of 1940, Registration Statement of Closed-End Management Investment Companies.’’ Form N–2 is the form used by closedend management investment companies (‘‘closed-end funds’’) to register as investment companies under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.) (‘‘Investment Company Act’’) and to register their securities under the Securities Act of 1933 (15 U.S.C. 77a et seq.) (‘‘Securities Act’’). The primary purpose of the registration process is to provide disclosure of financial and other information to investors and potential investors for the purpose of evaluating an investment in a security. Form N–2 also permits closed-end funds to provide investors with a prospectus containing information required in a registration statement prior to the sale or at the time of confirmation of delivery VerDate Aug<31>2005 14:36 Nov 17, 2008 Jkt 217001 of securities. The form also may be used by the Commission in its regulatory review, inspection, and policy-making roles. The Commission estimates that there are 140 initial registration statements and 60 post-effective amendments to initial registration statements filed on Form N–2 annually and that the average number of portfolios referenced in each initial filing and post-effective amendment is 1. The Commission further estimates that the hour burden for preparing and filing a post-effective amendment on Form N–2 is 116.5 hours per portfolio. The total annual hour burden for preparing and filing posteffective amendments is 6,990 hours (60 post-effective amendments × 1 portfolios × 116.5 hours per portfolio). The estimated annual hour burden for preparing and filing initial registration statements is 79,478 hours (140 initial registration statements × 1 portfolios × 567.7 hours per portfolio). The total annual hour burden for Form N–2, therefore, is estimated to be 86,468 hours (6,990 hours + 79,478 hours). The information collection requirements imposed by Form N–2 are mandatory. Responses to the collection of information will not be kept confidential. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid control number. Please direct general comments regarding the above information to the following persons: (i) Desk Officer for the Securities and Exchange Commission, Office of Management and Budget, Room 10102, New Executive Office Building, Washington, DC 20503 or e-mail to: nfraser@omb.eop.gov; and (ii) Lewis W. Walker, Acting Director/ CIO, Securities and Exchange Commission, C/O Shirley Martinson, 6432 General Green Way, Alexandria, VA 22312; or send an e-mail to: PRA_Mailbox@sec.gov. Comments must be submitted to OMB within 30 days of this notice. Dated: November 12, 2008. Florence E. Harmon, Acting Secretary. [FR Doc. E8–27431 Filed 11–17–08; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Sunshine Act Meeting Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94–409, that the Securities and Exchange PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 Commission will hold a Closed Meeting on Thursday, November 20, 2008, at 2 p.m. Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the Closed Meeting. Certain staff members who have an interest in the matters also may be present. The General Counsel of the Commission, or his designee, has certified that, in his opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (7), (8), 9(B) and (10) and 17 CFR 200.402(a)(3), (5), (7), (8), 9(ii) and (10), permit consideration of the scheduled matters at the Closed Meeting. Commissioner Casey, as duty officer, voted to consider the items listed for the Closed Meeting in closed session. The subject matter of the Closed Meeting scheduled for Thursday, November 20, 2008, will be: Formal orders of investigation; Institution and settlement of injunctive actions; Institution and settlement of administrative proceedings of an enforcement nature; An adjudicatory matter; Consideration of amicus participation; Regulatory matters regarding financial institutions; and Other matters relating to enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact: The Office of the Secretary at (202) 551–5400. Dated: November 13, 2008. Florence E. Harmon, Acting Secretary. [FR Doc. E8–27405 Filed 11–17–08; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58924; File No. SR–CBOE– 2008–96] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Approval of Proposed Rule Change To Permit $1 Strikes for MNX Options November 10, 2008. I. Introduction On September 16, 2008, the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission E:\FR\FM\18NON1.SGM 18NON1 Federal Register / Vol. 73, No. 223 / Tuesday, November 18, 2008 / Notices (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’)1 and Rule 19b–4 thereunder,2 this proposed rule change. The proposed rule change was published for comment in the Federal Register on October 8, 2008.3 The Commission received no comments on the proposal. This order approves the proposed rule change. II. Description of the Proposal The proposed rule change amends Rule 24.9, Terms of Index Option Contracts, by adding a new interpretation that will allow the Exchange to list options on the MiniNasdaq-100 Index (‘‘MNX’’ or ‘‘MiniNDX’’), which is based on 1⁄10th the value of the Nasdaq-100 Index, at $1 or greater strike price intervals.4 For initial series, the Exchange will be able to list at least two strike prices above and two strike prices below the current value of the MNX at or about the time a series is opened for trading on the Exchange. As part of this initial listing, the Exchange will be able to list strike prices that are within five points from the closing value of the MNX on the preceding day. The Exchange will be permitted to list additional series when the Exchange deems it necessary to maintain an orderly market, to meet customer demand, or when the underlying MNX moves substantially from the initial exercise price or prices. To the extent that any additional strike prices are listed by the Exchange, such additional strike prices shall be within thirty percent (30%) above or below the closing value of the MNX. The Exchange also will be permitted to open 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 See Securities Exchange Act Release No. 58659 (September 26, 2008), 73 FR 58998 (‘‘Notice’’). 4 Currently, under Interpretation and Policy .01(a)(xxv) to Rule 24.9, the Exchange has authority to list Mini-NDX options at $2.50 strike price intervals. The Commission notes that the Exchange rules currently allow the Exchange to list series at $1 or greater strike price intervals in similar options products. For example, Rule 24.9.01(b) allows the Exchange to list series on options based on one-one hundredth (1/100th) of the value of the Dow Jones Industrial Average Index at no less than $0.50 intervals. Similarly, Rule 24.9.01(f) allows the Exchange to list strike price intervals at no less than $1 for options on the CBOE S&P 500 BuyWrite Index (1/10th value). In addition, Rule 24.9.11 allows the Exchange to list strike price intervals at no less than $1 for the reduced-value version of the Standard & Poor’s S&P 500 Stock Index option (‘‘Mini-SPX option’’), which is based on 1/10th the value of the S&P 500 Index. See Securities Exchange Act Release Nos. 39011 (September 3, 1997), 62 FR 47840 (September 11, 1997); 58207 (July 29, 2008), 73 FR 43963 (July 22, 2008); 52625 (October 18, 2005), 70 FR 61479 (October 24, 2005); and 57049 (December 27, 2007), 73 FR 528 (January 3, 2008). dwashington3 on PRODPC61 with NOTICES 2 17 VerDate Aug<31>2005 14:36 Nov 17, 2008 Jkt 217001 additional strike prices that are more than 30% above or below the current MNX value provided that demonstrated customer interest exists for such series, as expressed by institutional, corporate or individual customers or their brokers. Market-Makers trading for their own account will not be considered when determining customer interest. In addition to the initial listed series, the Exchange may list up to sixty (60) additional series per expiration month for each series in Mini-NDX options. The Exchange proposes that it shall not list LEAPS on Mini-NDX options at intervals less than $5. The Exchange also is proposing to set forth a delisting policy with respect to Mini-NDX options. The Exchange will, on a monthly basis, review series that are outside a range of five (5) strikes above and five (5) strikes below the current value of the MNX and delist series with no open interest in both the put and the call series having a: (i) Strike higher than the highest strike price with open interest in the put and/ or call series for a given expiration month; and (ii) strike lower than the lowest strike price with open interest in the put and/or call series for a given expiration month. Notwithstanding the proposed delisting policy, customer requests to add strikes and/or maintain strikes in Mini-NDX options in series eligible for delisting shall be granted. III. Commission’s Findings and Order Granting Approval of the Proposed Rule Change After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange.5 In particular, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Act 6 in that it is designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts, and, in general, to protect investors and the public interest. Specifically, the Commission believes that the proposal to permit listing of $1 strike prices for Mini-NDX options will provide investors with added flexibility in the trading of Mini-NDX options and further the public interest by allowing investors to establish positions that are better tailored to meet their investment objectives. The Commission also believes that the proposal strikes a reasonable balance between the 5 In approving this proposed rule change, the Commission notes that it has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 6 15 U.S.C. 78f(b)(5). PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 68465 Exchange’s desire to accommodate market participants by offering a wider array of investment opportunities and the need to avoid unnecessary proliferation of options series and the corresponding increase in quotes. The Commission notes that the existing restrictions on listing $1 strike price intervals will continue to apply, e.g., no $1 strike price may be listed (a) that is greater than $5 from MNX’s closing price on the preceding day, or (b) that would result in strike prices being $0.50 apart. In approving the proposed rule change, the Commission has relied on the Exchange’s representation that it has the necessary systems capacity to support the new options series that will be listed under this proposal. The Commission expects the Exchange to continue to monitor for options with little or no open interest and trading activity and to act promptly to delist such options. In addition, the Commission expects that CBOE will continue to monitor the trading volume associated with the additional options series listed as a result of this proposal and the effect of these additional series on market fragmentation and on the capacity of the Exchange’s, OPRA’s, and vendors’ automated systems. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,7 that the proposed rule change (SR–CBOE–2008– 96) be, and it hereby is, approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Florence E. Harmon, Acting Secretary. [FR Doc. E8–27280 Filed 11–17–08; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58910; File No. SR–DTC– 2008–07] Self-Regulatory Organizations; The Depository Trust Company; Order Granting Approval of a Proposed Rule Change To Implement Processing Enhancements to the Profile Modification System Used in the Direct Registration System November 6, 2008. I. Introduction On July 7, 2008, The Depository Trust Company (‘‘DTC’’) filed with the 7 15 8 17 U.S.C. 78s(b)(2). CFR 200.30–3(a)(12). E:\FR\FM\18NON1.SGM 18NON1

Agencies

[Federal Register Volume 73, Number 223 (Tuesday, November 18, 2008)]
[Notices]
[Pages 68464-68465]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-27280]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58924; File No. SR-CBOE-2008-96]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Order Granting Approval of Proposed Rule Change To Permit 
$1 Strikes for MNX Options

November 10, 2008.

I. Introduction

    On September 16, 2008, the Chicago Board Options Exchange, 
Incorporated (``CBOE'' or ``Exchange'') filed with the Securities and 
Exchange Commission

[[Page 68465]]

(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'')\1\ and Rule 19b-4 thereunder,\2\ this 
proposed rule change. The proposed rule change was published for 
comment in the Federal Register on October 8, 2008.\3\ The Commission 
received no comments on the proposal. This order approves the proposed 
rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 58659 (September 26, 
2008), 73 FR 58998 (``Notice'').
---------------------------------------------------------------------------

II. Description of the Proposal

    The proposed rule change amends Rule 24.9, Terms of Index Option 
Contracts, by adding a new interpretation that will allow the Exchange 
to list options on the Mini-Nasdaq-100 Index (``MNX'' or ``Mini-NDX''), 
which is based on \1/10\th the value of the Nasdaq-100 Index, at $1 or 
greater strike price intervals.\4\ For initial series, the Exchange 
will be able to list at least two strike prices above and two strike 
prices below the current value of the MNX at or about the time a series 
is opened for trading on the Exchange. As part of this initial listing, 
the Exchange will be able to list strike prices that are within five 
points from the closing value of the MNX on the preceding day.
---------------------------------------------------------------------------

    \4\ Currently, under Interpretation and Policy .01(a)(xxv) to 
Rule 24.9, the Exchange has authority to list Mini-NDX options at 
$2.50 strike price intervals. The Commission notes that the Exchange 
rules currently allow the Exchange to list series at $1 or greater 
strike price intervals in similar options products. For example, 
Rule 24.9.01(b) allows the Exchange to list series on options based 
on one-one hundredth (1/100th) of the value of the Dow Jones 
Industrial Average Index at no less than $0.50 intervals. Similarly, 
Rule 24.9.01(f) allows the Exchange to list strike price intervals 
at no less than $1 for options on the CBOE S&P 500 BuyWrite Index 
(1/10th value). In addition, Rule 24.9.11 allows the Exchange to 
list strike price intervals at no less than $1 for the reduced-value 
version of the Standard & Poor's S&P 500 Stock Index option (``Mini-
SPX option''), which is based on 1/10th the value of the S&P 500 
Index. See Securities Exchange Act Release Nos. 39011 (September 3, 
1997), 62 FR 47840 (September 11, 1997); 58207 (July 29, 2008), 73 
FR 43963 (July 22, 2008); 52625 (October 18, 2005), 70 FR 61479 
(October 24, 2005); and 57049 (December 27, 2007), 73 FR 528 
(January 3, 2008).
---------------------------------------------------------------------------

    The Exchange will be permitted to list additional series when the 
Exchange deems it necessary to maintain an orderly market, to meet 
customer demand, or when the underlying MNX moves substantially from 
the initial exercise price or prices. To the extent that any additional 
strike prices are listed by the Exchange, such additional strike prices 
shall be within thirty percent (30%) above or below the closing value 
of the MNX. The Exchange also will be permitted to open additional 
strike prices that are more than 30% above or below the current MNX 
value provided that demonstrated customer interest exists for such 
series, as expressed by institutional, corporate or individual 
customers or their brokers. Market-Makers trading for their own account 
will not be considered when determining customer interest. In addition 
to the initial listed series, the Exchange may list up to sixty (60) 
additional series per expiration month for each series in Mini-NDX 
options. The Exchange proposes that it shall not list LEAPS on Mini-NDX 
options at intervals less than $5.
    The Exchange also is proposing to set forth a delisting policy with 
respect to Mini-NDX options. The Exchange will, on a monthly basis, 
review series that are outside a range of five (5) strikes above and 
five (5) strikes below the current value of the MNX and delist series 
with no open interest in both the put and the call series having a: (i) 
Strike higher than the highest strike price with open interest in the 
put and/or call series for a given expiration month; and (ii) strike 
lower than the lowest strike price with open interest in the put and/or 
call series for a given expiration month. Notwithstanding the proposed 
delisting policy, customer requests to add strikes and/or maintain 
strikes in Mini-NDX options in series eligible for delisting shall be 
granted.

III. Commission's Findings and Order Granting Approval of the Proposed 
Rule Change

    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange.\5\ 
In particular, the Commission finds that the proposed rule change is 
consistent with Section 6(b)(5) of the Act \6\ in that it is designed 
to promote just and equitable principles of trade, to prevent 
fraudulent and manipulative acts, and, in general, to protect investors 
and the public interest.
---------------------------------------------------------------------------

    \5\ In approving this proposed rule change, the Commission notes 
that it has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Specifically, the Commission believes that the proposal to permit 
listing of $1 strike prices for Mini-NDX options will provide investors 
with added flexibility in the trading of Mini-NDX options and further 
the public interest by allowing investors to establish positions that 
are better tailored to meet their investment objectives. The Commission 
also believes that the proposal strikes a reasonable balance between 
the Exchange's desire to accommodate market participants by offering a 
wider array of investment opportunities and the need to avoid 
unnecessary proliferation of options series and the corresponding 
increase in quotes. The Commission notes that the existing restrictions 
on listing $1 strike price intervals will continue to apply, e.g., no 
$1 strike price may be listed (a) that is greater than $5 from MNX's 
closing price on the preceding day, or (b) that would result in strike 
prices being $0.50 apart.
    In approving the proposed rule change, the Commission has relied on 
the Exchange's representation that it has the necessary systems 
capacity to support the new options series that will be listed under 
this proposal. The Commission expects the Exchange to continue to 
monitor for options with little or no open interest and trading 
activity and to act promptly to delist such options. In addition, the 
Commission expects that CBOE will continue to monitor the trading 
volume associated with the additional options series listed as a result 
of this proposal and the effect of these additional series on market 
fragmentation and on the capacity of the Exchange's, OPRA's, and 
vendors' automated systems.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\7\ that the proposed rule change (SR-CBOE-2008-96) be, and it 
hereby is, approved.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(2).
    \8\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-27280 Filed 11-17-08; 8:45 am]
BILLING CODE 8011-01-P
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