Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Penny Pilot Program, 57721-57722 [E9-26883]
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[Federal Register Volume 74, Number 215 (Monday, November 9, 2009)] [Notices] [Pages 57721-57722] From the Federal Register Online via the Government Printing Office [www.gpo.gov] [FR Doc No: E9-26883] [[Page 57721]] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-60919; File No. SR-CBOE-2009-079] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Penny Pilot Program November 3, 2009. 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 October 28, 2009, the Chicago Board Options Exchange, Incorporated (``Exchange'' or ``CBOE'') filed with the Securities and Exchange Commission (the ``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 CBOE proposes to amend proposes to amend its rules relating to the Penny Pilot Program. The text of the rule proposal is available on the Exchange's Web site (https://www.cboe.org/legal), at the Exchange's Office of the Secretary 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 self-regulatory organization 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 those 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. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose CBOE proposes to identify the 75 option classes that will be added to the Penny Pilot Program beginning on November 2, 2009. CBOE recently received approval to extend and expand the Penny Pilot Program through December 31, 2010.\3\ As described in its filing, the Pilot Program will be expanded by adding 300 option classes, in groups of 75 classes each quarter beginning on the following dates: November 2, 2009, February 1, 2010, May 3, 2010, and August 2, 2010.\4\ The option classes will be identified based on national average daily volume in the six calendar months preceding their addition to the Pilot Program using data compiled by The Options Clearing Corporation, except that the month immediately preceding their addition to the Pilot Program would not be utilized for purposes of the six month analysis. --------------------------------------------------------------------------- \3\ See Securities Exchange Act Release No. 60864 (October 22, 2009), granting immediate effectiveness to SR-CBOE-2009-76. \4\ The classes to be added are among the most actively-traded, multiply-listed option classes that are not currently in the Pilot Program, excluding option classes with high premiums. An option class would be designated as ``high premium'' if, at the time of selection, the underlying security was priced at $200 per share or above, or the underlying index level was at 200 or above. --------------------------------------------------------------------------- The following 75 option classes will be added to the Pilot Program beginning on November 2, 2009: ------------------------------------------------------------------------ Symbol Company name ------------------------------------------------------------------------ ABX................................. Barrick Gold Corp AXP................................. American Express Co AUY................................. Yamana Gold Inc BA.................................. Boeing Co/The BBT................................. BB&T Corp BBY................................. Best Buy Co Inc BP.................................. BP PLC CHK................................. Chesapeake Energy Corp CIT................................. CIT Group Inc COF................................. Capital One Financial Corp CVX................................. Chevron Corp DE.................................. Deere & Co DOW................................. Dow Chemical Co/The DRYS................................ DryShips Inc EFA................................. iShares MSCI EAFE Index Fund ETFC................................ E*Trade Financial Corp EWZ................................. iShares MSCI Brazil Index Fund FAS................................. Direxion Daily Financial Bull 3X Shares FAZ................................. Direxion Daily Financial Bear 3X Shares FITB................................ Fifth Third Bancorp FSLR................................ First Solar Inc FXI................................. iShares FTSE/Xinhua China 25 Index Fund GDX................................. Market Vectors--Gold Miners ETF GG.................................. Goldcorp Inc GLD................................. SPDR Gold Trust HGSI................................ Human Genome Sciences Inc HIG................................. Hartford Financial Services Group Inc HPQ................................. Hewlett-Packard Co IBM................................. International Business Machines Corp IYR................................. iShares Dow Jones US Real Estate Index Fund JNJ................................. Johnson & Johnson JNPR................................ Juniper Networks Inc KO.................................. Coca-Cola Co/The LVS................................. Las Vegas Sands Corp MCD................................. McDonald's Corp MGM................................. MGM Mirage MON................................. Monsanto Co MOS................................. Mosaic Co/The MRK................................. Merck & Co Inc/NJ MS.................................. Morgan Stanley NLY................................. Annaly Capital Management Inc NOK................................. Nokia OYJ NVDA................................ Nvidia Corp ORCL................................ Oracle Corp PALM................................ Palm Inc PBR................................. Petroleo Brasileiro SA PG.................................. Procter & Gamble Co/The POT................................. Potash Corp of Saskatchewan Inc RF.................................. Regions Financial Corp RIG................................. Transocean Ltd RMBS................................ Rambus Inc S................................... Sprint Nextel Corp SDS................................. ProShares UltraShort S&P500 SKF................................. ProShares UltraShort Financials SLB................................. Schlumberger Ltd SLV................................. iShares Silver Trust SRS................................. ProShares UltraShort Real Estate SSO................................. ProShares Ultra S&P500 STI................................. SunTrust Banks Inc SVNT................................ Savient Pharmaceuticals Inc TBT................................. ProShares UltraShort 20+ Year Treasury UNG................................. United States Natural Gas Fund LP UNH................................. UnitedHealth Group Inc UPS................................. United Parcel Service Inc USB................................. US Bancorp USO................................. United States Oil Fund LP UYG................................. ProShares Ultra Financials V................................... Visa Inc WFC................................. Wells Fargo & Co WYNN................................ Wynn Resorts Ltd X................................... United States Steel Corp XHB................................. SPDR S&P Homebuilders ETF XLI................................. Industrial Select Sector SPDR Fund XLU................................. Utilities Select Sector SPDR Fund XRT................................. SPDR S&P Retail ETF ------------------------------------------------------------------------ The minimum increments for all classes in the Penny Pilot, except for the QQQQs, continue to be $0.01 for all option series below $3 (including LEAPS), and $0.05 for all option series $3 and above (including LEAPS). For QQQQs, the minimum increment remains $0.01 for all option series. 2. Statutory Basis The Exchange believes the rule proposal is consistent with the Securities Exchange Act of 1934 (the ``Act'') and the rules and regulations under the Act applicable to a national [[Page 57722]] securities exchange and, in particular, the requirements of Section 6(b) of the Act.\5\ Specifically, the Exchange believes that the proposed rule change is consistent with the Section 6(b)(5) Act \6\ requirements that the rules of an exchange be 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 by identifying the option classes to be added to the Pilot Program in a manner consistent with CBOE's prior rule filing SR-CBOE- 2009-76 to extend and expand the Pilot Program. --------------------------------------------------------------------------- \5\ 15 U.S.C. 78f(b). \6\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition CBOE does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. 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 The proposed rule change is filed for immediate effectiveness pursuant to Section 19(b)(3)(A) \7\ of the Securities Exchange Act of 1934 and Rule 19b-4(f)(1) \8\ thereunder as it constitutes a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule. 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 furtherance of the purposes of the Act. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78s(b)(3)(A). \8\ 17 CFR 240.19b-4(f)(1). --------------------------------------------------------------------------- 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 CommentsUse the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or Send an e-mail to rule-comments@sec.gov. Please include File Number SR-CBOE-2009-079 on the subject line. Paper Comments Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-CBOE-2009-079. 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 (https://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 such filing also will be available for inspection and copying at the principal office of the CBOE. 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-CBOE-2009-079 and should be submitted on or before November 30, 2009. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\9\ --------------------------------------------------------------------------- \9\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Florence E. Harmon, Deputy Secretary. [FR Doc. E9-26883 Filed 11-6-09; 8:45 am] BILLING CODE 8011-01-P
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