Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Approving a Proposed Rule Change Related to a Change to the Trading Symbol for P.M.-Settled Options on the Standard & Poor's 500 Index, 11673-11674 [2017-03573]
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Federal Register / Vol. 82, No. 36 / Friday, February 24, 2017 / Notices
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 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 No. SR–MIAX–
2017–05, and should be submitted on or
before March 17, 2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–03575 Filed 2–23–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–80060; File No. SR–CBOE–
2016–091]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Order Approving a
Proposed Rule Change Related to a
Change to the Trading Symbol for
P.M.-Settled Options on the Standard &
Poor’s 500 Index
February 17, 2017.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
I. Introduction
On December 16, 2016, Chicago Board
Options Exchange, Incorporated (the
‘‘Exchange’’ or ‘‘CBOE’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change
amending CBOE’s rules related to P.M.settled options on the Standard & Poor’s
500 Index (‘‘S&P 500 Index’’). The
proposed rule change was published for
comment in the Federal Register on
January 5, 2017.3 The Commission
received no comment letters on the
proposed rule change. This order
approves the proposed rule change.
II. Description of the Proposed Rule
Change
CBOE proposes to move P.M.-settled
S&P 500 Index options expiring on the
13 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 79712
(December 29, 2016), 82 FR 1383 (January 5, 2017)
(‘‘Notice’’).
1 15
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17:20 Feb 23, 2017
Jkt 241001
third-Friday of the month (‘‘thirdFriday’’), currently listed in a separate
class and trading under the symbol
‘‘SPXPM’’, to the Hybrid 3.0 S&P 500
Index options class. In connection with
the move, the Exchange proposes
changing the trading symbol for these
options from ‘‘SPXPM’’ to ‘‘SPXW.’’
The Exchange currently lists A.M.settled 4 and P.M.-settled 5 S&P 500
Index options that have standard thirdFriday expirations. Third-Friday A.M.settled S&P 500 Index options trade
under the symbol ‘‘SPX’’ on the
Exchange’s Hybrid 3.0 platform.6 ThirdFriday P.M.-settled S&P 500 Index
options trade on the Hybrid Trading
System in a separate options class under
the symbol ‘‘SPXPM’’.7
In addition, the Hybrid 3.0 options
class also includes nonstandard P.M.settled S&P 500 Index options trading
under the symbol ‘‘SPXW,’’ which may
expire on Mondays, Wednesdays,
Fridays (other than the third-Friday-ofthe-month) (i.e., nonstandard weekly
expirations pursuant to Rule 24.9(e)),
and the last trading day of the month.8
Although SPXW options are included in
the Hybrid 3.0 class, they trade on the
Hybrid Trading System.9
In its filing, the Exchange noted that
a gap exists currently in Friday
expirations for SPXW as a user of SPXW
options cannot roll an existing SPXW
position that expires on a first or second
Friday of a month into a SPXW position
that expires on a third-Friday, because
the latter is part of the separate SPXPM
class.10 Moving SPXPM into the SPX
class under symbol SPXW will remove
this gap and allow market participants
to maintain exposure to SPXW Friday
expirations throughout the month if
they so choose. The Exchange also
noted that offering access to all P.M.settled S&P 500 Index options in a
single class with expirations every
Friday of the month will provide market
participants with greater flexibility in
submitting complex orders using S&P
500 index options.11
In its filing, the Exchange noted its
belief that moving SPXPM into the SPX
options class under the symbol SPXW
should not adversely impact market
4 See Rule 24.9(a)(4)(i) (A.M.-settled index
options).
5 See Rule 24.9.14 (authorizing the Exchange to
list P.M.-settled S&P 500 options for a specified
pilot period).
6 See Rule 8.3(c)(iii).
7 See Rule 8.3(c)(i) (identifying P.M.-settled thirdFriday S&P 500 options as a Tier AA Hybrid
Options Class).
8 See Rule 24.9(e).
9 See Rule 8.14.01.
10 See Notice, supra note 3, at 1384.
11 See id.
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Frm 00151
Fmt 4703
Sfmt 4703
11673
participants.12 Specifically, the
Exchange noted that it expects a smooth
transition of the SPXPM series to the
SPXW symbol because SPXPM and
SPXW options both trade on the Hybrid
Trading System 13 and the Exchange’s
rules and systems treat SPXPM and
SPXW the same in many respects.14
Pilot Reports
SPXPM options currently are
approved for listing and trading on a
pilot basis.15 The Exchange represents
that the pilot will continue under the
same terms that established the pilot.16
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act 17 and the rules and regulations
thereunder applicable to a national
securities exchange.18 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act, 19 which requires,
among other things, that the rules of a
national securities exchange be
designed to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest.
The Exchange represents that trading
P.M.-settled third-Friday expirations as
part of the S&P 500 Index options class
under the SPXW symbol, rather than as
a separate class under the SPXPM
symbol, will help remove impediments
to and perfect the mechanism of a free
and open market by providing market
participants with access to a single class
12 See
id.
Rules 8.3(c)(i) (identifying P.M.-settled
third-Friday S&P Index options as a Tier AA Hybrid
Options Class) and 8.14.01 (allowing the Exchange
to authorize a group of series of a class for trading
on the Hybrid Trading System).
14 See Notice, supra note 3, at 1384–85
(discussing areas where trading parameters for
SPXPM and SPXW are the same, such as the
minimum increment for bids and offers, and where
they differ, such as the appointment costs).
15 See Rule 24.9.14 and Securities Exchange Act
Release No. 68457 (December 18, 2012), 77 FR
76135 (December 26, 2012) (SR–CBOE–2012–120).
16 See Notice, supra note 3, at 1385. As part of
the pilot, the Exchange submits quarterly reports
and annual reports that analyze the market impact
and trading patterns of third-Friday P.M.-settled
S&P 500 options. The Exchange will modify the
reports to provide the same data and analysis for
third-Friday P.M.-settled S&P 500 Index options
trading under symbol SPXW that it currently
submits for third-Friday P.M.-settled S&P 500 Index
options trading under symbol SPXPM. See id.
17 15 U.S.C. 78f.
18 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
19 15 U.S.C. 78f(b)(5).
13 See
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11674
Federal Register / Vol. 82, No. 36 / Friday, February 24, 2017 / Notices
of P.M.-settled S&P 500 Index options
with expirations every Friday of the
month.20 The Commission believes that
the proposal can thus benefit investors
by providing them with additional
trading flexibility for both simple and
complex orders.
Further, the Exchange represents that
there are minimal differences in the
trading parameters of the two options
classes.21 Although the appointment
costs for SPXPM and SPX are different,
the Exchange represents that market
makers should not be adversely
impacted by this proposal because all
market-makers currently appointed in
SPXPM also are appointed in SPX,
which confers the right to trade SPXW
options.22 The Commission believes
that, to the extent the trading parameters
of the two classes are substantively
similar, the Exchange’s proposal to
move SPXPM options into the SPX
options class does not raise novel
issues.
Finally, SPXPM options currently are
listed on a pilot basis. As part of the
pilot, the Exchange has been required to
submit to the Commission quarterly
reports and annual reports that analyze
the market impact and trading patterns
of third-Friday P.M.-settled S&P 500
options. The Exchange represents that it
will continue to provide this data in
exactly the same scope and format.23
The Commission believes that the
continued pilot and reports will allow
the Exchange and the Commission to
monitor for and assess any potential
adverse market impact caused by these
P.M.-settled options.
Based on the Exchange’s
representations discussed above, and for
the reasons noted above, the
Commission believes that the proposal
to move SPXPM options into the SPX
options class is consistent with the Act.
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 24, that the
proposed rule change (SR–CBOE–2016–
091) be, and hereby is, approved.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.25
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–03573 Filed 2–23–17; 8:45 am]
BILLING CODE 8011–01–P
20 See
Notice, supra note 3, at 1386.
id. at 1384–85.
22 See id. at 1385.
23 See id.
24 15 U.S.C. 78s(b)(2).
25 17 CFR 200.30–3(a)(12).
21 See
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Jkt 241001
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–80059; File No. SR–
NYSEArca–2017–16]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending Rules 6.62,
6.73 and Make a Conforming Change
to Rule 6.47A
February 17, 2017.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on February
10, 2017, NYSE Arca, Inc. (‘‘Exchange’’
or ‘‘NYSE Arca’’) 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 self-regulatory
organization. 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
Rule 6.62 to eliminate Price Improving
Orders and Quotes, and amend Rule
6.73 to eliminate the electronic and
open outcry bidding and offering
requirements associated with a Price
Improving Order or Quote, and make a
conforming change to Rule 6.47A. 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.
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
PO 00000
Frm 00152
Fmt 4703
Sfmt 4703
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
Rule 6.62 to eliminate Price Improving
Orders and Quotes, and amend Rule
6.73 to eliminate the electronic and
open outcry bidding and offering
requirements associated with a Price
Improving Order or Quote, and make a
conforming change to Rule 6.47A. The
Exchange proposes to eliminate these
order types in order to streamline its
rules and reduce complexity among its
order type offerings.4
Elimination of Price Improving Orders
and Quotes
The Exchange proposes to eliminate,
and thus delete from its rules, Price
Improving Orders and Quotes, as
defined in Rule 6.62(s).
A Price Improving Order or Price
Improving Quote is an order or quote to
buy or sell an option at a specified price
at an increment smaller than the
minimum price variation in the
security. Price Improving Orders and
Quotes may be entered in increments as
small as one cent. Because the Exchange
has not implemented this functionality,
the Exchange believes it is appropriate
to delete the functionality from its
rules.5
To reflect this elimination, the
Exchange proposes to delete all
references to Price Improving Orders
and Quotes in Rule 6.62(s), and to the
electronic and open outcry bidding and
offering requirements associated with a
Price Improving Order or Quote in the
second introductory paragraph of Rule
6.73 and Rules 6.73(a), 6.73(b) and
6.73(c), and to delete in the
Commentary to Rule 6.47A references to
Rule 6.62(s) and 6.73, as follows: 6
4 See e.g., Mary Jo White, Chair, Securities and
Exchange Commission, Speech at the Sandler
O’Neill & Partners, L.P. Global Exchange and
Brokerage Conference (June 5, 2014) (available at
www.sec.gov/News/Speech/Detail/Speech/
1370542004312#.U5HI-fmwJiw) (‘‘I am asking the
exchanges to conduct a comprehensive review of
their order types and how they operate in practice.
As part of this review, I expect that the exchanges
will consider appropriate rule changes to help
clarify the nature of their order types and how they
interact with each other, and how they support fair,
orderly, and efficient markets.’’ Id.)
5 Though originally adopted as a competitive
response to another options market introducing
price improving orders, the Exchange never
implemented this functionality for a variety of
reasons, including technology and because most
options volume was concentrated in Penny Pilot
issues where price improving orders would be of
little or no value.
6 See Securities Exchange Act Release No. 58079
(July 2, 2008), 73 FR 39365 (July 9, 2009) (SR–
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]]>Agencies
[Federal Register Volume 82, Number 36 (Friday, February 24, 2017)]
[Notices]
[Pages 11673-11674]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-03573]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-80060; File No. SR-CBOE-2016-091]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Order Approving a Proposed Rule Change Related to a
Change to the Trading Symbol for P.M.-Settled Options on the Standard &
Poor's 500 Index
February 17, 2017.
I. Introduction
On December 16, 2016, Chicago Board Options Exchange, Incorporated
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change amending CBOE's rules related to
P.M.-settled options on the Standard & Poor's 500 Index (``S&P 500
Index''). The proposed rule change was published for comment in the
Federal Register on January 5, 2017.\3\ The Commission received no
comment letters on the proposed rule change. 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. 79712 (December 29,
2016), 82 FR 1383 (January 5, 2017) (``Notice'').
---------------------------------------------------------------------------
II. Description of the Proposed Rule Change
CBOE proposes to move P.M.-settled S&P 500 Index options expiring
on the third-Friday of the month (``third-Friday''), currently listed
in a separate class and trading under the symbol ``SPXPM'', to the
Hybrid 3.0 S&P 500 Index options class. In connection with the move,
the Exchange proposes changing the trading symbol for these options
from ``SPXPM'' to ``SPXW.''
The Exchange currently lists A.M.-settled \4\ and P.M.-settled \5\
S&P 500 Index options that have standard third-Friday expirations.
Third-Friday A.M.-settled S&P 500 Index options trade under the symbol
``SPX'' on the Exchange's Hybrid 3.0 platform.\6\ Third-Friday P.M.-
settled S&P 500 Index options trade on the Hybrid Trading System in a
separate options class under the symbol ``SPXPM''.\7\
---------------------------------------------------------------------------
\4\ See Rule 24.9(a)(4)(i) (A.M.-settled index options).
\5\ See Rule 24.9.14 (authorizing the Exchange to list P.M.-
settled S&P 500 options for a specified pilot period).
\6\ See Rule 8.3(c)(iii).
\7\ See Rule 8.3(c)(i) (identifying P.M.-settled third-Friday
S&P 500 options as a Tier AA Hybrid Options Class).
---------------------------------------------------------------------------
In addition, the Hybrid 3.0 options class also includes nonstandard
P.M.-settled S&P 500 Index options trading under the symbol ``SPXW,''
which may expire on Mondays, Wednesdays, Fridays (other than the third-
Friday-of-the-month) (i.e., nonstandard weekly expirations pursuant to
Rule 24.9(e)), and the last trading day of the month.\8\ Although SPXW
options are included in the Hybrid 3.0 class, they trade on the Hybrid
Trading System.\9\
---------------------------------------------------------------------------
\8\ See Rule 24.9(e).
\9\ See Rule 8.14.01.
---------------------------------------------------------------------------
In its filing, the Exchange noted that a gap exists currently in
Friday expirations for SPXW as a user of SPXW options cannot roll an
existing SPXW position that expires on a first or second Friday of a
month into a SPXW position that expires on a third-Friday, because the
latter is part of the separate SPXPM class.\10\ Moving SPXPM into the
SPX class under symbol SPXW will remove this gap and allow market
participants to maintain exposure to SPXW Friday expirations throughout
the month if they so choose. The Exchange also noted that offering
access to all P.M.-settled S&P 500 Index options in a single class with
expirations every Friday of the month will provide market participants
with greater flexibility in submitting complex orders using S&P 500
index options.\11\
---------------------------------------------------------------------------
\10\ See Notice, supra note 3, at 1384.
\11\ See id.
---------------------------------------------------------------------------
In its filing, the Exchange noted its belief that moving SPXPM into
the SPX options class under the symbol SPXW should not adversely impact
market participants.\12\ Specifically, the Exchange noted that it
expects a smooth transition of the SPXPM series to the SPXW symbol
because SPXPM and SPXW options both trade on the Hybrid Trading System
\13\ and the Exchange's rules and systems treat SPXPM and SPXW the same
in many respects.\14\
---------------------------------------------------------------------------
\12\ See id.
\13\ See Rules 8.3(c)(i) (identifying P.M.-settled third-Friday
S&P Index options as a Tier AA Hybrid Options Class) and 8.14.01
(allowing the Exchange to authorize a group of series of a class for
trading on the Hybrid Trading System).
\14\ See Notice, supra note 3, at 1384-85 (discussing areas
where trading parameters for SPXPM and SPXW are the same, such as
the minimum increment for bids and offers, and where they differ,
such as the appointment costs).
---------------------------------------------------------------------------
Pilot Reports
SPXPM options currently are approved for listing and trading on a
pilot basis.\15\ The Exchange represents that the pilot will continue
under the same terms that established the pilot.\16\
---------------------------------------------------------------------------
\15\ See Rule 24.9.14 and Securities Exchange Act Release No.
68457 (December 18, 2012), 77 FR 76135 (December 26, 2012) (SR-CBOE-
2012-120).
\16\ See Notice, supra note 3, at 1385. As part of the pilot,
the Exchange submits quarterly reports and annual reports that
analyze the market impact and trading patterns of third-Friday P.M.-
settled S&P 500 options. The Exchange will modify the reports to
provide the same data and analysis for third-Friday P.M.-settled S&P
500 Index options trading under symbol SPXW that it currently
submits for third-Friday P.M.-settled S&P 500 Index options trading
under symbol SPXPM. See id.
---------------------------------------------------------------------------
III. Discussion and Commission Findings
After careful review, the Commission finds that the proposed rule
change is consistent with the requirements of the Act \17\ and the
rules and regulations thereunder applicable to a national securities
exchange.\18\ In particular, the Commission finds that the proposed
rule change is consistent with Section 6(b)(5) of the Act, \19\ which
requires, among other things, that the rules of a national securities
exchange be designed to remove impediments to and perfect the mechanism
of a free and open market and a national market system, and, in
general, to protect investors and the public interest.
---------------------------------------------------------------------------
\17\ 15 U.S.C. 78f.
\18\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
\19\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange represents that trading P.M.-settled third-Friday
expirations as part of the S&P 500 Index options class under the SPXW
symbol, rather than as a separate class under the SPXPM symbol, will
help remove impediments to and perfect the mechanism of a free and open
market by providing market participants with access to a single class
[[Page 11674]]
of P.M.-settled S&P 500 Index options with expirations every Friday of
the month.\20\ The Commission believes that the proposal can thus
benefit investors by providing them with additional trading flexibility
for both simple and complex orders.
---------------------------------------------------------------------------
\20\ See Notice, supra note 3, at 1386.
---------------------------------------------------------------------------
Further, the Exchange represents that there are minimal differences
in the trading parameters of the two options classes.\21\ Although the
appointment costs for SPXPM and SPX are different, the Exchange
represents that market makers should not be adversely impacted by this
proposal because all market-makers currently appointed in SPXPM also
are appointed in SPX, which confers the right to trade SPXW
options.\22\ The Commission believes that, to the extent the trading
parameters of the two classes are substantively similar, the Exchange's
proposal to move SPXPM options into the SPX options class does not
raise novel issues.
---------------------------------------------------------------------------
\21\ See id. at 1384-85.
\22\ See id. at 1385.
---------------------------------------------------------------------------
Finally, SPXPM options currently are listed on a pilot basis. As
part of the pilot, the Exchange has been required to submit to the
Commission quarterly reports and annual reports that analyze the market
impact and trading patterns of third-Friday P.M.-settled S&P 500
options. The Exchange represents that it will continue to provide this
data in exactly the same scope and format.\23\ The Commission believes
that the continued pilot and reports will allow the Exchange and the
Commission to monitor for and assess any potential adverse market
impact caused by these P.M.-settled options.
---------------------------------------------------------------------------
\23\ See id.
---------------------------------------------------------------------------
Based on the Exchange's representations discussed above, and for
the reasons noted above, the Commission believes that the proposal to
move SPXPM options into the SPX options class is consistent with the
Act.
IV. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the Act
\24\, that the proposed rule change (SR-CBOE-2016-091) be, and hereby
is, approved.
---------------------------------------------------------------------------
\24\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
---------------------------------------------------------------------------
\25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-03573 Filed 2-23-17; 8:45 am]
BILLING CODE 8011-01-P
