Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the First Trust CBOE S&P 500 VIX Tail Hedge Fund (Formerly, the First Trust CBOE VIX Tail Hedge Index Fund), 53239-53241 [2012-21493]

Download as PDF Federal Register / Vol. 77, No. 170 / Friday, August 31, 2012 / Notices Please direct your written comments to Thomas Bayer, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way, Alexandria, Virginia 22312, or send an email to: PRA_Mailbox@sec.gov. Dated: August 27, 2012. Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–21487 Filed 8–30–12; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change [Release No. 34–67732; File No. SR– NYSEArca–2012–90] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the First Trust CBOE S&P 500 VIX Tail Hedge Fund (Formerly, the First Trust CBOE VIX Tail Hedge Index Fund) August 27, 2012. 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 August 13, 2012, NYSE Arca, Inc. (‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been substantially prepared by the selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. EMCDONALD on DSK67QTVN1PROD with NOTICES I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to correct the reference to the Index Provider applicable to the First Trust CBOE S&P 500 VIX Tail Hedge Fund (formerly, the First Trust CBOE VIX Tail Hedge Index Fund) (‘‘Fund’’), and to reflect changes to the name of the index underlying the Fund and to the name of the Fund, which the Commission has approved for listing and trading on the Exchange under NYSE Arca Equities Rule 5.2(j)(3). The text of the proposed rule change is available on the Exchange’s Web site at www.nyse.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. 1 15 2 17 U.S.C. 78s(b)(1). CFR 240.19b–4. VerDate Mar<15>2010 15:22 Aug 30, 2012 Jkt 226001 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. 1. Purpose The Commission has approved listing and trading on the Exchange of shares (‘‘Shares’’) of the Fund 3 under NYSE Arca Equities Rule 5.2(j)(3), the Exchange’s listing standards for Investment Company Units (‘‘Units’’).4 The Shares will be offered by First Trust Exchange-Traded Fund (‘‘Trust’’), which is organized as a Massachusetts business trust and is registered with the Commission as an open-end management investment company.5 The investment adviser to the Fund will be First Trust Advisors L.P. (‘‘Adviser’’ or ‘‘First Trust’’). First Trust Portfolios L.P. (‘‘Distributor’’) is the principal underwriter and distributor of the Fund’s Shares. The Bank of New York Mellon Corporation (‘‘BNY’’) will serve 3 See Securities Exchange Act Release No. 67485 (July 23, 2012), 77 FR 44291 (July 27, 2012) (SR– NYSEArca–2012–50) (‘‘Prior Order’’). See also Securities Exchange Act Release No. 67107 (June 4, 2012), 77 FR 34102 (June 8, 2012) (SR–NYSEArca– 2012–50) (‘‘Prior Notice,’’ and together with the Prior Order, the ‘‘Prior Release’’). 4 An Investment Company Unit is a security that represents an interest in a registered investment company that holds securities comprising, or otherwise based on or representing an interest in, an index or portfolio of securities (or holds securities in another registered investment company that holds securities comprising, or otherwise based on or representing an interest in, an index or portfolio of securities). See NYSE Arca Equities Rule 5.2(j)(3)(A). 5 The Trust is registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1) (‘‘1940 Act’’). On July 18, 2012, the Trust filed with the Commission an amendment to its registration statement on Form N–1A under the Securities Act of 1933 (15 U.S.C. 77a), and under the 1940 Act relating to the Fund (File Nos. 333–125751 and 811–21774) (‘‘Registration Statement’’). The description of the operation of the Trust and the Fund herein is based, in part, on the Registration Statement. In addition, the Commission has issued an order granting certain exemptive relief to the Trust under the 1940 Act. See Investment Company Act Release No. 27068 (September 20, 2005) (File No. 812–13000) (‘‘Exemptive Order’’). PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 53239 as administrator, custodian, and transfer agent for the Fund. According to the Prior Release, the Fund will seek investment results that correspond generally to the price and yield, before the Fund’s fees and expenses, of an equity index called the CBOE S&P VIX Tail Hedge Index (‘‘Index’’). The Index is designed to provide a benchmark for investors interested in hedging tail risk in an S&P 500 portfolio. In the Prior Notice, the Exchange represented that the Index is rules-based and is owned and was developed by Standard & Poor’s Financial Services LLC (‘‘S&P’’) and that S&P is the Index Provider.6 The Exchange further represented that the Index Provider will calculate and maintain the Index. The Exchange seeks to correct a representation made regarding the Index Provider reflected in the Prior Release, as described below. The Exchange is revising this representation to state that, pursuant to an arrangement with the Chicago Board Options Exchange, Inc. (‘‘CBOE’’), S&P has certain rights to license the Index to third parties. S&P has licensed the Index to First Trust for use by First Trust and the Fund. CBOE compiles, maintains, and owns the Index, and CBOE is the Index Provider with respect to the Fund. CBOE is not a broker-dealer or affiliated with a broker-dealer, and has implemented procedures designed to prevent the use and dissemination of material, nonpublic information regarding the Index.7 In the Prior Release, the Exchange represented that the name of the Index underlying the Fund is the CBOE S&P VIX Tail Hedge Index. The Exchange is changing this representation to state that the name of the Index underlying the Fund is the CBOE VIX Tail Hedge Index.8 In addition, in the Prior Release, the Exchange represented that the name of the Fund is the First Trust CBOE VIX Tail Hedge Index Fund. The Exchange is changing this representation to state that the name of the Fund has been 6 S&P is not a broker-dealer or affiliated with a broker-dealer, and has implemented procedures designed to prevent the use and dissemination of material, non-public information regarding the Index. 7 The change to the representation regarding the Index Provider described herein will be effective upon filing with the Commission of another amendment to the Trust’s Registration Statement. See note 5, supra. 8 The change to the name of the Index underlying the Fund was reflected in the July 18, 2012 amendment to the Registration Statement. See note 5, supra. E:\FR\FM\31AUN1.SGM 31AUN1 53240 Federal Register / Vol. 77, No. 170 / Friday, August 31, 2012 / Notices changed to First Trust CBOE S&P 500 VIX Tail Hedge Fund.9 The Adviser represents that there is no change to the Fund’s investment objective. The Fund will comply with all requirements under NYSE Arca Equities Rule 5.2(j)(3).10 Except for the changes noted above, all other facts presented and representations made in the Prior Release remain unchanged. All terms referenced but not defined herein are defined in the Prior Release. 2. Statutory Basis The basis under the Act for this proposed rule change is the requirement under Section 6(b)(5) 11 that an exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. The Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the proposed rule change corrects the representation made in the Prior Release to state that CBOE, and not S&P, compiles, maintains, and owns the Index, and that CBOE is the Index Provider with respect to the Fund. Both S&P and CBOE are not broker-dealers and are not affiliated with a broker-dealer and have implemented procedures designed to prevent the use and dissemination of material, non-public information regarding the Index. The Fund will comply with all requirements under NYSE Arca Equities Rule 5.2(j)(3), and Commentary .01(a)(A) thereto, except that the Index may include up to 1% of the Index weight in VIX call options, which are not NMS Stocks as defined in Rule 600 of Regulation NMS. EMCDONALD on DSK67QTVN1PROD with NOTICES 9 The change to the name of the Fund was reflected in the July 18, 2012 amendment to the Registration Statement. See note 5, supra. 10 As noted in the Prior Release, the Index for the Fund does not meet all of the ‘‘generic’’ listing requirements of Commentary .01(a)(A) to NYSE Arca Equities Rule 5.2(j)(3) applicable to the listing of Investment Company Units based upon an index of US Component Stocks, as defined in NYSE Arca Equities Rule 5.2(j)(3). Specifically, Commentary .01(a)(A) to NYSE Arca Equities Rule 5.2(j)(3) sets forth the requirements to be met by components of an index or portfolio of US Component Stocks. As described in the Prior Release, the Index consists of an S&P 500 Index stock portfolio and may consist of a position in specified VIX Index (‘‘VIX’’) call options. The Index meets all requirements of NYSE Arca Equities Rule 5.2(j)(3) and Commentary .01(a)(A) thereto except that the Index may include up to 1% of the Index weight in VIX call options, which are not NMS Stocks as defined in Rule 600 of Regulation NMS. See notes 3 and 5, supra, and accompanying text. 11 15 U.S.C. 78f(b)(5). VerDate Mar<15>2010 15:22 Aug 30, 2012 Jkt 226001 The proposed rule change is designed to promote just and equitable principles of trade and to protect investors and the public interest in that the Adviser represents that there is no change to the Fund’s investment objective. Both S&P and CBOE are unaffiliated with a broker-dealer and have implemented procedures designed to prevent the use and dissemination of material, nonpublic information regarding the Index. The functions of the Index Provider are those described in the Prior Release, and this proposed rule change corrects representations made in the Prior Release by stating that CBOE, and not S&P, is the Index Provider and compiles, maintains, and owns the Index. In addition, the Exchange seeks to reflect changes to the name of the Index underlying the Fund and to the name of the Fund, as described above. The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that, except for the changes noted above, all other representations made in the Prior Release remain unchanged. The Adviser represents that there is no change to the Fund’s investment objective. In addition, with the exception noted above,12 the Fund will comply with all requirements under NYSE Arca Equities Rule 5.2(j)(3). 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. 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 Because the proposed rule change does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to 12 See PO 00000 note 10, supra. Frm 00073 Fmt 4703 Sfmt 4703 Section 19(b)(3)(A) of the Act 13 and Rule 19b–4(f)(6) thereunder.14 The Commission notes that the proposed rule change does not significantly affect the protection of investors or the public interest and does not impose any significant burden on competition. NYSE Arca represents that there is no change to the Fund’s investment objective and seeks to correct a representation made regarding the Index Provider reflected in the Prior Release to state that, pursuant to an arrangement with the CBOE, S&P has certain rights to license the Index to third parties. S&P has licensed the Index to First Trust for use by First Trust and the Fund. CBOE is the Index Provider and compiles, maintains, and owns the Index. CBOE is not a broker-dealer or affiliated with a broker-dealer and has implemented procedures designed to prevent the use and dissemination of material, nonpublic information regarding the Index. In addition, the Exchange seeks to reflect changes to the name of the Index underlying the Fund and the name of the Fund, as described above. A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act 15 normally does not become operative for 30 days after the date of its filing. However, Rule 19b–4(f)(6) permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay, noting that the Commission has previously approved listing and trading of the Fund on the Exchange, the Shares have not yet commenced trading, the proposed changes in this filing will not impact the operation of the Fund or the Index as described in the Prior Release, and the Adviser is prepared to commence Exchange listing and trading prior to the end of the 30-day operative-delay period. The Exchange proposes to correct the representation made in the Prior Release to state that CBOE, and not S&P, compiles, maintains, and owns the Index, and that CBOE is the Index Provider. Both S&P and CBOE are not broker-dealers and are not affiliated with a broker-dealer and have implemented procedures designed to prevent the use and dissemination of 13 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). As required under Rule 19b–4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. 15 17 CFR 240.19b–4(f)(6). 14 17 E:\FR\FM\31AUN1.SGM 31AUN1 Federal Register / Vol. 77, No. 170 / Friday, August 31, 2012 / Notices material, non-public information regarding the Index. In addition, the Exchange is reflecting changes to the name of the Index underlying the Fund and to the name of the Fund, as described above. The changes to the representation regarding the Index Provider described herein will be effective upon filing with the Commission of another amendment to the Trust’s Registration Statement. The changes to the name of the Index underlying the Fund and the name of the Fund were reflected in a July 18, 2012 amendment to the Registration Statement.16 The Fund will comply with all requirements under NYSE Arca Equities Rule 5.2(j)(3).17 Except for the changes noted above, all other representations made in the Prior Release remain unchanged. For the foregoing reasons, the Commission believes that waiving the 30-day operative delay would be consistent with the protection of investors and the public interest.18 Therefore, the Commission designates the proposal operative upon filing. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend 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. 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: • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rulecomments@sec.gov. Please include File Number SR–NYSEArca–2012–90 on the subject line. EMCDONALD on DSK67QTVN1PROD with NOTICES Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. 16 See note 5, supra. 17 See note 10, supra. 18 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 15:22 Aug 30, 2012 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–21493 Filed 8–30–12; 8:45 am] BILLING CODE 8011–01–P Electronic Comments VerDate Mar<15>2010 All submissions should refer to File Number SR–NYSEArca–2012–90. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (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 Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR– NYSEArca–2012–90 and should be submitted on or before September 21, 2012. Jkt 226001 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–67733; File No. SR–OCC– 2012–11] Self-Regulatory Organizations; Options Clearing Corporation; Order Approving Proposed Rule Change Relating to the Auction Process Under Options Clearing Corporation Rule 1104 I. Introduction On July 3, 2012, the Options Clearing Corporation (‘‘OCC’’) filed with the Securities and Exchange Commission 19 17 PO 00000 CFR 200.30–3(a)(12). Frm 00074 Fmt 4703 (‘‘Commission’’) the proposed rule change SR–OCC–2012–11 pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder.2 The proposed rule change was published for comment in the Federal Register on July 20, 2012.3 The Commission received no comment letters. This order approves the proposed rule change. II. Description In a recent rule change, OCC proposed and the Commission approved provisions to OCC Rule 1104 and Rule 1106 to specifically provide that, in addition to all other permitted means of liquidating positions and collateral in the accounts of a suspended Clearing Member, OCC may, at its discretion, liquidate such positions and collateral through a private auction process.4 The purpose of the current rule change is to add an interpretation .02 to Rule 1104 to provide a further general description of such a private auction process by which OCC may liquidate all or any part of a suspended Clearing Member’s accounts. The proposed interpretation sets forth the basic parameters of such an auction, including the process for creating a standing pool of pre-qualified potential bidders, criteria for fixing the number of bidders to participate in any particular auction and the method of selection of such bidders. Such criteria are intended to ensure an orderly and robust auction and to ensure that auction bidders are financially able to make payment for and assume the obligations of the collateral and positions they are acquiring and able to manage the risk thereof and/or trade out of the positions without creating unnecessary further risk to the Corporation. Interpretations crossreferencing interpretation .02 to Rule 1104 will be added following Rules 1106, 1107, 2210, and 2210A, and the latter three rules are proposed to be amended to provide that the auction process is applicable to assets and obligations arising from exercised and assigned options and matured, physically-settled futures and to assets and obligations arising from the closeout of stock loan and borrow positions as well. 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Securities Exchange Act Release No. 67443 (July 16, 2012), 77 FR 42784 (July 20, 2012). 4 See Exchange Act Release No. 65654 (October 28, 2011), 76 FR 68236 (November 3, 2011) (SR– OCC–2011–08) (Order Approving Proposed Rule Change, as Modified by Amendment No. 1, to Provide Specific Authority to Use an Auction Process as One of the Means to Liquidate a Defaulting Clearing Member’s Accounts). 2 17 August 27, 2012. Sfmt 4703 53241 E:\FR\FM\31AUN1.SGM 31AUN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 77, Number 170 (Friday, August 31, 2012)]
[Notices]
[Pages 53239-53241]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-21493]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67732; File No. SR-NYSEArca-2012-90]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Relating to the
First Trust CBOE S&P 500 VIX Tail Hedge Fund (Formerly, the First Trust
CBOE VIX Tail Hedge Index Fund)

August 27, 2012.
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 August 13, 2012, NYSE Arca, Inc. (``Exchange'' or ``NYSE
Arca'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been substantially prepared by the self-
regulatory organization. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The Exchange proposes to correct the reference to the Index
Provider applicable to the First Trust CBOE S&P 500 VIX Tail Hedge Fund
(formerly, the First Trust CBOE VIX Tail Hedge Index Fund) (``Fund''),
and to reflect changes to the name of the index underlying the Fund and
to the name of the Fund, which the Commission has approved for listing
and trading on the Exchange under NYSE Arca Equities Rule 5.2(j)(3).
The text of the proposed rule change is available on the Exchange's Web
site at www.nyse.com, at the principal office of the Exchange, 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
Statutory Basis for, the Proposed Rule Change

1. Purpose
The Commission has approved listing and trading on the Exchange of
shares (``Shares'') of the Fund \3\ under NYSE Arca Equities Rule
5.2(j)(3), the Exchange's listing standards for Investment Company
Units (``Units'').\4\
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\3\ See Securities Exchange Act Release No. 67485 (July 23,
2012), 77 FR 44291 (July 27, 2012) (SR-NYSEArca-2012-50) (``Prior
Order''). See also Securities Exchange Act Release No. 67107 (June
4, 2012), 77 FR 34102 (June 8, 2012) (SR-NYSEArca-2012-50) (``Prior
Notice,'' and together with the Prior Order, the ``Prior Release'').
\4\ An Investment Company Unit is a security that represents an
interest in a registered investment company that holds securities
comprising, or otherwise based on or representing an interest in, an
index or portfolio of securities (or holds securities in another
registered investment company that holds securities comprising, or
otherwise based on or representing an interest in, an index or
portfolio of securities). See NYSE Arca Equities Rule 5.2(j)(3)(A).
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The Shares will be offered by First Trust Exchange-Traded Fund
(``Trust''), which is organized as a Massachusetts business trust and
is registered with the Commission as an open-end management investment
company.\5\ The investment adviser to the Fund will be First Trust
Advisors L.P. (``Adviser'' or ``First Trust''). First Trust Portfolios
L.P. (``Distributor'') is the principal underwriter and distributor of
the Fund's Shares. The Bank of New York Mellon Corporation (``BNY'')
will serve as administrator, custodian, and transfer agent for the
Fund.
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\5\ The Trust is registered under the Investment Company Act of
1940 (15 U.S.C. 80a-1) (``1940 Act''). On July 18, 2012, the Trust
filed with the Commission an amendment to its registration statement
on Form N-1A under the Securities Act of 1933 (15 U.S.C. 77a), and
under the 1940 Act relating to the Fund (File Nos. 333-125751 and
811-21774) (``Registration Statement''). The description of the
operation of the Trust and the Fund herein is based, in part, on the
Registration Statement. In addition, the Commission has issued an
order granting certain exemptive relief to the Trust under the 1940
Act. See Investment Company Act Release No. 27068 (September 20,
2005) (File No. 812-13000) (``Exemptive Order'').
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According to the Prior Release, the Fund will seek investment
results that correspond generally to the price and yield, before the
Fund's fees and expenses, of an equity index called the CBOE S&P VIX
Tail Hedge Index (``Index''). The Index is designed to provide a
benchmark for investors interested in hedging tail risk in an S&P 500
portfolio.
In the Prior Notice, the Exchange represented that the Index is
rules-based and is owned and was developed by Standard & Poor's
Financial Services LLC (``S&P'') and that S&P is the Index Provider.\6\
The Exchange further represented that the Index Provider will calculate
and maintain the Index.
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\6\ S&P is not a broker-dealer or affiliated with a broker-
dealer, and has implemented procedures designed to prevent the use
and dissemination of material, non-public information regarding the
Index.
---------------------------------------------------------------------------

The Exchange seeks to correct a representation made regarding the
Index Provider reflected in the Prior Release, as described below. The
Exchange is revising this representation to state that, pursuant to an
arrangement with the Chicago Board Options Exchange, Inc. (``CBOE''),
S&P has certain rights to license the Index to third parties. S&P has
licensed the Index to First Trust for use by First Trust and the Fund.
CBOE compiles, maintains, and owns the Index, and CBOE is the Index
Provider with respect to the Fund. CBOE is not a broker-dealer or
affiliated with a broker-dealer, and has implemented procedures
designed to prevent the use and dissemination of material, non-public
information regarding the Index.\7\
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\7\ The change to the representation regarding the Index
Provider described herein will be effective upon filing with the
Commission of another amendment to the Trust's Registration
Statement. See note 5, supra.
---------------------------------------------------------------------------

In the Prior Release, the Exchange represented that the name of the
Index underlying the Fund is the CBOE S&P VIX Tail Hedge Index. The
Exchange is changing this representation to state that the name of the
Index underlying the Fund is the CBOE VIX Tail Hedge Index.\8\
---------------------------------------------------------------------------

\8\ The change to the name of the Index underlying the Fund was
reflected in the July 18, 2012 amendment to the Registration
Statement. See note 5, supra.
---------------------------------------------------------------------------

In addition, in the Prior Release, the Exchange represented that
the name of the Fund is the First Trust CBOE VIX Tail Hedge Index Fund.
The Exchange is changing this representation to state that the name of
the Fund has been

[[Page 53240]]

changed to First Trust CBOE S&P 500 VIX Tail Hedge Fund.\9\
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\9\ The change to the name of the Fund was reflected in the July
18, 2012 amendment to the Registration Statement. See note 5, supra.
---------------------------------------------------------------------------

The Adviser represents that there is no change to the Fund's
investment objective. The Fund will comply with all requirements under
NYSE Arca Equities Rule 5.2(j)(3).\10\
---------------------------------------------------------------------------

\10\ As noted in the Prior Release, the Index for the Fund does
not meet all of the ``generic'' listing requirements of Commentary
.01(a)(A) to NYSE Arca Equities Rule 5.2(j)(3) applicable to the
listing of Investment Company Units based upon an index of US
Component Stocks, as defined in NYSE Arca Equities Rule 5.2(j)(3).
Specifically, Commentary .01(a)(A) to NYSE Arca Equities Rule
5.2(j)(3) sets forth the requirements to be met by components of an
index or portfolio of US Component Stocks. As described in the Prior
Release, the Index consists of an S&P 500 Index stock portfolio and
may consist of a position in specified VIX Index (``VIX'') call
options. The Index meets all requirements of NYSE Arca Equities Rule
5.2(j)(3) and Commentary .01(a)(A) thereto except that the Index may
include up to 1% of the Index weight in VIX call options, which are
not NMS Stocks as defined in Rule 600 of Regulation NMS. See notes 3
and 5, supra, and accompanying text.
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Except for the changes noted above, all other facts presented and
representations made in the Prior Release remain unchanged.
All terms referenced but not defined herein are defined in the
Prior Release.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \11\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

\11\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
proposed rule change corrects the representation made in the Prior
Release to state that CBOE, and not S&P, compiles, maintains, and owns
the Index, and that CBOE is the Index Provider with respect to the
Fund. Both S&P and CBOE are not broker-dealers and are not affiliated
with a broker-dealer and have implemented procedures designed to
prevent the use and dissemination of material, non-public information
regarding the Index. The Fund will comply with all requirements under
NYSE Arca Equities Rule 5.2(j)(3), and Commentary .01(a)(A) thereto,
except that the Index may include up to 1% of the Index weight in VIX
call options, which are not NMS Stocks as defined in Rule 600 of
Regulation NMS.
The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that the Adviser represents that there is no change to the Fund's
investment objective. Both S&P and CBOE are unaffiliated with a broker-
dealer and have implemented procedures designed to prevent the use and
dissemination of material, non-public information regarding the Index.
The functions of the Index Provider are those described in the Prior
Release, and this proposed rule change corrects representations made in
the Prior Release by stating that CBOE, and not S&P, is the Index
Provider and compiles, maintains, and owns the Index. In addition, the
Exchange seeks to reflect changes to the name of the Index underlying
the Fund and to the name of the Fund, as described above.
The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that, except for the changes noted above, all other
representations made in the Prior Release remain unchanged. The Adviser
represents that there is no change to the Fund's investment objective.
In addition, with the exception noted above,\12\ the Fund will comply
with all requirements under NYSE Arca Equities Rule 5.2(j)(3).
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\12\ See note 10, supra.
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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.

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

Because the proposed rule change does not (i) significantly affect
the protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days after the date of the filing, or such shorter time as the
Commission may designate if consistent with the protection of investors
and the public interest, the proposed rule change has become effective
pursuant to Section 19(b)(3)(A) of the Act \13\ and Rule 19b-4(f)(6)
thereunder.\14\ The Commission notes that the proposed rule change does
not significantly affect the protection of investors or the public
interest and does not impose any significant burden on competition.
NYSE Arca represents that there is no change to the Fund's investment
objective and seeks to correct a representation made regarding the
Index Provider reflected in the Prior Release to state that, pursuant
to an arrangement with the CBOE, S&P has certain rights to license the
Index to third parties. S&P has licensed the Index to First Trust for
use by First Trust and the Fund. CBOE is the Index Provider and
compiles, maintains, and owns the Index. CBOE is not a broker-dealer or
affiliated with a broker-dealer and has implemented procedures designed
to prevent the use and dissemination of material, non-public
information regarding the Index. In addition, the Exchange seeks to
reflect changes to the name of the Index underlying the Fund and the
name of the Fund, as described above.
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\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \15\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6) permits the Commission to
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay, noting that the
Commission has previously approved listing and trading of the Fund on
the Exchange, the Shares have not yet commenced trading, the proposed
changes in this filing will not impact the operation of the Fund or the
Index as described in the Prior Release, and the Adviser is prepared to
commence Exchange listing and trading prior to the end of the 30-day
operative-delay period. The Exchange proposes to correct the
representation made in the Prior Release to state that CBOE, and not
S&P, compiles, maintains, and owns the Index, and that CBOE is the
Index Provider. Both S&P and CBOE are not broker-dealers and are not
affiliated with a broker-dealer and have implemented procedures
designed to prevent the use and dissemination of

[[Page 53241]]

material, non-public information regarding the Index. In addition, the
Exchange is reflecting changes to the name of the Index underlying the
Fund and to the name of the Fund, as described above. The changes to
the representation regarding the Index Provider described herein will
be effective upon filing with the Commission of another amendment to
the Trust's Registration Statement. The changes to the name of the
Index underlying the Fund and the name of the Fund were reflected in a
July 18, 2012 amendment to the Registration Statement.\16\ The Fund
will comply with all requirements under NYSE Arca Equities Rule
5.2(j)(3).\17\ Except for the changes noted above, all other
representations made in the Prior Release remain unchanged. For the
foregoing reasons, the Commission believes that waiving the 30-day
operative delay would be consistent with the protection of investors
and the public interest.\18\ Therefore, the Commission designates the
proposal operative upon filing.
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\15\ 17 CFR 240.19b-4(f)(6).
\16\ See note 5, supra.
\17\ See note 10, supra.
\18\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend 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.

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 (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NYSEArca-2012-90 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-NYSEArca-2012-90. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (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 Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSEArca-2012-90 and should
be submitted on or before September 21, 2012.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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\19\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-21493 Filed 8-30-12; 8:45 am]
BILLING CODE 8011-01-P

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