Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend IM-5050-6 (Short Term Option Series Program), 72572-72577 [2022-25666]
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Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
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. The
Exchange does not believe the proposed
rule change will impose any burden on
intramarket competition that is not
necessary or appropriate in furtherance
of the purposes of the Act because the
increased position limit (and exercise
limit) will be available to all market
participants and apply to each in the
same manner. The Exchange believes
that the proposed rule change will
provide additional opportunities for
market participants to continue to
efficiently achieve their investment and
trading objectives for AAPL options on
the Exchange.
The Exchange does not believe that
the proposed rule change will impose
any burden on intermarket competition
that is not necessary or appropriate in
furtherance of the Act. On the contrary,
the Exchange believes the proposal
promotes competition because it may
maintain order flow on exchanges,
which would in turn compete amongst
each other for those orders, and prevent
a transfer of trading activity to the
nontransparent OTC market.22 The
Exchange believes market participants
would benefit from being able to trade
options with increased position limits
in an exchange environment in several
ways, including but not limited to the
following: (1) enhanced efficiency in
initiating and closing out position; (2)
increased market transparency; and (3)
heightened contra-party
creditworthiness due to the role of OCC
as issuer and guarantor. The Exchange
notes that other options exchanges may
choose to file similar proposals with the
Commission to increase the position
limit on AAPL options.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
khammond on DSKJM1Z7X2PROD with NOTICES
The Exchange neither solicited nor
received comments on the proposed
rule change.
22 Additionally, several other options exchanges
have the same position limits as the Exchange, as
they incorporate by reference to the Exchange’s
position limits, and as a result the position limits
for options on AAPL options will increase at those
exchanges. For example, Nasdaq Options position
limits are determined by the position limits
established by the Exchange. See Nasdaq Stock
Market LLC Rules, Options 9, Sec. 13 (Position
Limits).
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III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days (i) as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or (ii) as to which
the Exchange consents, the Commission
will:
A. by order approve or disapprove
such proposed rule change, or
B. institute proceedings to determine
whether the proposed rule change
should be disapproved.
IV. Solicitation of Comments
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–CBOE–2022–057, and
should be submitted on or before
December 16,2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.23
Sherry R. Haywood,
Assistant Secretary.
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:
[FR Doc. 2022–25664 Filed 11–23–22; 8:45 am]
Electronic Comments
[Release No. 34–96355; File No. SR–BOX–
2022–29]
• 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–
CBOE–2022–057.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–CBOE–2022–057. 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 website (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 website 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
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BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations; BOX
Exchange LLC; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Amend IM–5050–6
(Short Term Option Series Program)
November 18, 2022.
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 November
16, 2022, BOX Exchange LLC (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend IM–
5050–6 (Short Term Option Series
Program). The text of the proposed rule
change is available from the principal
office of the Exchange, at the
Commission’s Public Reference Room
and also on the Exchange’s internet
website at https://
rules.boxexchange.com/rulefilings.
17 CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
23
1 15
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Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
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 these statements may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend IM–
5050–6 (Short Term Option Series
Program). Specifically, the Exchange
proposes to amend the Short Term
Option Series Rules to: (1) limit the
number of Short Term Option
Expiration Dates for options on SPDR
S&P 500 ETF Trust (SPY), the INVESCO
QQQ Trust SM, Series 1 (QQQ), and
iShares Russell 2000 ETF (IWM) from
five to two expirations for Monday and
Wednesday expirations; and (2) expand
the Short Term Option Series program
to permit the listing and trading of
options series with Tuesday and
Thursday expirations for options on
SPY and QQQ listed pursuant to the
Short Term Option Series Program,
subject to the same proposed limitation
of two expirations. The Exchange also
proposes to amend Rule 100(a)(66)
which defines a Short Term Option
Series. This is a competitive filing that
is based on a proposal recently
submitted by Nasdaq ISE, LLC (‘‘Nasdaq
ISE’’) and approved by the
Commission.3
khammond on DSKJM1Z7X2PROD with NOTICES
Curtail Short Term Option Expiration
Dates
Currently, after an option class has
been approved for listing and trading on
the Exchange, the Exchange may open
for trading on any Thursday or Friday
that is a business day (‘‘Short Term
Option Opening Date’’) series of options
on that class that expire at the close of
business on each of the next five Fridays
that are business days and are not
Fridays in which monthly options series
or Quarterly Options Series expire
(‘‘Short Term Option Expiration Dates’’).
3 See Securities Exchange Act Release No. 96281
(November 9, 2022) (Order Approving SR–ISE–
2022–18).
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The Exchange may have no more than
a total of five Short Term Option
Expiration Dates not including any
Monday or Wednesday SPY, QQQ, and
IWM Expirations. Further, if the
Exchange is not open for business on
the respective Thursday or Friday, the
Short Term Option Opening Date will
be the first business day immediately
prior to that respective Thursday or
Friday. Similarly, if the Exchange is not
open for business on a Friday, the Short
Term Option Expiration Date will be the
first business day immediately prior to
that Friday.
Today, with respect to Wednesday
SPY, QQQ, and IWM Expirations, the
Exchange may open for trading on any
Tuesday or Wednesday that is a
business day series of options on SPY,
QQQ, and IWM to expire on any
Wednesday of the month that is a
business day and is not a Wednesday in
which Quarterly Options Series expire
(‘‘Wednesday SPY Expirations,’’
‘‘Wednesday QQQ Expirations,’’ and
‘‘Wednesday IWM Expirations’’). With
respect to Monday SPY, QQQ, and IWM
Expirations, the Exchange may open for
trading on any Friday or Monday that is
a business day series of options on the
SPY, QQQ, or IWM to expire on any
Monday of the month that is a business
day and is not a Monday in which
Quarterly Options Series expire
(‘‘Monday SPY Expirations,’’ ‘‘Monday
QQQ Expirations,’’ and ‘‘Monday IWM
Expirations’’), provided that Monday
SPY Expirations, Monday QQQ
Expirations, and Monday IWM
Expirations that are listed on a Friday
must be listed at least one business
week and one business day prior to the
expiration. The Exchange may list up to
five consecutive Wednesday SPY
Expirations, Wednesday QQQ
Expirations, and Wednesday IWM
Expirations and five consecutive
Monday SPY Expirations, Monday QQQ
Expirations, and Monday IWM
Expirations at one time; the Exchange
may have no more than a total of five
each of Wednesday SPY Expirations,
Wednesday QQQ Expirations, and
Wednesday IWM Expirations and a total
of five each of Monday SPY Expirations,
Monday QQQ Expirations, and Monday
IWM Expirations. Monday and
Wednesday SPY Expirations, Monday
and Wednesday QQQ Expirations, and
Monday and Wednesday IWM
Expirations will be subject to the
provisions of IM–5050–6.
Proposal
At this time, the Exchange proposes to
curtail the number of Short Term
Option Expiration Dates from five to
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72573
two 4 for SPY, QQQ and IWM for
Monday and Wednesday Expirations, as
well as the proposed Tuesday and
Thursday Expirations in SPY and QQQ
(‘‘Short Term Option Daily
Expirations’’).
The Exchange proposes to create a
new category of Short Term Option
Expirations Dates called ‘‘Short Term
Option Daily Expirations’’ which will
only permit two Short Term Option
Expiration Dates for each of Monday,
Tuesday, Wednesday, and Thursday
expirations at one time. The Exchange
proposes to include a table, labelled
‘‘Table 1’’, within IM–5050–6(a) which
specifies each symbol that qualifies as a
Short Term Option Daily Expiration.
The table would note the number of
expirations for each symbol as well as
expiration days. The Exchange proposes
to include Monday and Wednesday
expirations for SPY, QQQ, and IWM and
Tuesday and Thursday expirations for
SPY and QQQ and list the number of
expirations as ‘‘2’’ for these symbols.
The Exchange’s proposal to permit
Tuesday and Thursday expirations for
options on SPY and QQQ listed
pursuant to the Short Term Option
Series Program is explained below in
more detail. In the event Short Term
Option Daily Expirations expire on the
same day in the same class as a monthly
options series or a Quarterly Options
Series, the Exchange would skip that
week’s listing and instead list the
following week; the two weeks of Short
Term Option Expiration Dates would
therefore not be consecutive.
Specifically, the Exchange proposes to
state within IM–5050–6(a),
In addition to the above, BOX may open for
trading series of options on the symbols
provided in Table 1 below that expire at the
close of business on each of the next two
Mondays, Tuesdays, Wednesdays, and
Thursdays, respectively, that are business
days and are not business days in which
monthly options series or Quarterly Options
Series expire (‘‘Short Term Option Daily
Expirations’’). BOX may have no more than
a total of two Short Term Option Daily
Expirations for each of Monday, Tuesday,
Wednesday, and Thursday expirations at one
time. Short Term Option Daily Expirations
would be subject to IM–5050–6.
SPY, QQQ, and IWM Friday expirations
and other option symbols expiring on a
Friday that are not noted in Table 1 will
continue to have a total of five Short
Term Option Expiration Dates provided
those Friday expirations are not Fridays
in which monthly options series or
Quarterly Options Series expire
(‘‘Friday Short Term Option Expiration
Dates’’). These expirations would be
4 The Exchange proposes to list the two front
months for Short Term Option Daily Expirations.
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Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
referred to as ‘‘Short Term Option
Weekly Expirations’’ to distinguish
them from the proposed expirations that
would be subject to Short Term Option
Daily Expirations. The Exchange
proposes to add rule text to IM–5050–
6(a) which states that Monday Short
Term Option Expiration Dates, Tuesday
Short Term Option Expiration Dates,
Wednesday Short Term Option
Expiration Dates, and Thursday Short
Term Option Expiration Dates, together
with Friday Short Term Option
Expiration Dates, are collectively ‘‘Short
Term Option Expiration Dates’’.5
khammond on DSKJM1Z7X2PROD with NOTICES
Tuesday and Thursday Expirations
At this time, the Exchange proposes to
expand the Short Term Option Series
Program to permit the listing and
trading of no more than a total of two
consecutive Tuesday and Thursday
‘‘Tuesday Short Term Option Daily
Expirations’’ and ‘‘Thursday Short Term
Option Daily Expirations’’ each for SPY
and QQQ at one time. Tuesday and
Thursday Short Term Option Daily
Expirations would be subject to IM–
5050–6.
A Short Term Option Series means a
series in an option class that is
approved for listing and trading on the
Exchange in which the series is opened
for trading on any Monday, Tuesday,
Wednesday, Thursday or Friday that is
a business day and that expires on the
Monday, Wednesday or Friday of the
following business week that is a
business day, or, in the case of a series
that is listed on a Friday and expires on
a Monday, is listed one business week
and one business day prior to that
expiration. If a Tuesday, Wednesday,
Thursday or Friday is not a business
day, the series may be opened (or shall
expire) on the first business day
immediately prior to that Tuesday,
Wednesday, Thursday or Friday. For a
series listed pursuant to this section for
Monday expiration, if a Monday is not
a business day, the series shall expire on
the first business day immediately
following that Monday.
The Exchange proposes to amend the
definition at Rule 100(a)(66) to
accommodate the listing of options
series that expire on Tuesdays and
Thursdays. Specifically, the Exchange
proposes to add Tuesday and Thursdays
to the permitted expiration days, which
currently include Monday, Wednesday,
and Friday, that it may open for trading.
The Exchange also proposes
corresponding changes within IM–
5 Defining the term ‘‘Short Term Option
Expiration Dates’’ will make clear that this term
includes expiration dates for each day Short Term
Options are listed.
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5050–6, which sets forth the
requirements for SPY and QQQ options
that are listed pursuant to the Short
Term Option Series Program as Short
Term Option Daily Expirations. Similar
to Monday and Wednesday SPY, QQQ,
and IWM Short Term Option Daily
Expirations within IM–5050–6, the
Exchange proposes that it may open for
trading on any Monday or Tuesday that
is a business day series of options on the
symbols provided in Table 1 that expire
at the close of business on each of the
next two Tuesdays that are business
days and are not business days in which
monthly options series or Quarterly
Options Series expire (‘‘Tuesday Short
Term Option Expiration Date’’).
Likewise, the Exchange proposes that
it may open for trading on any
Wednesday or Thursday that is a
business day series of options on
symbols provided in Table 1 that expire
at the close of business on each of the
next two Thursdays that are business
days and are not business days in which
monthly options series or Quarterly
Options Series expire (‘‘Thursday Short
Term Option Expiration Date’’).
In the event that options on SPY and
QQQ expire on a Tuesday or Thursday
and that Tuesday or Thursday is the
same day that a monthly option series
or Quarterly Options Series expires, the
Exchange would skip that week’s listing
and instead list the following week; the
two weeks would therefore not be
consecutive. Today, Monday and
Wednesday Expirations in SPY, QQQ,
and IWM skip the weekly listing in the
event the weekly listing expires on the
same day in the same class as a
Quarterly Options Series. Currently,
there is no rule text provision that states
that Monday and Wednesday
Expirations in SPY, QQQ, and IWM skip
the weekly listing in the event the
weekly listing expires on the same day
in the same class as a monthly option
series. Practically speaking, Monday
and Wednesday Expirations in SPY,
QQQ, and IWM would not expire on the
same day as a monthly expiration.
The interval between strike prices for
the proposed Tuesday and Thursday
SPY and QQQ Short Term Option Daily
Expirations will be the same as those for
the current Short Term Option Series for
Monday, Wednesday and Friday
expirations applicable to the Short Term
Option Series Program.6 Specifically,
the Tuesday and Thursday SPY and
QQQ Short Term Option Daily
Expirations will have a $0.50 strike
interval minimum.7 As is the case with
other equity options series listed
6 See
IM–5050–6(b)(5).
8 See
7 Id.
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Frm 00133
pursuant to the Short Term Option
Series Program, the Tuesday and
Thursday SPY and QQQ Short Term
Option Daily Expiration series will be
P.M.-settled.
Pursuant to Rule 100(a)(66), with
respect to the Short Term Option Series
Program, a Tuesday or Thursday
expiration series shall expire on the first
business day immediately prior to that
Tuesday or Thursday, e.g., Monday or
Wednesday of that week, respectively, if
the Tuesday or Thursday is not a
business day.
Currently, for each option class
eligible for participation in the Short
Term Option Series Program, the
Exchange is limited to opening thirty
(30) series for each expiration date for
the specific class.8 The thirty (30) series
restriction does not include series that
are open by other securities exchanges
under their respective weekly rules; the
Exchange may list these additional
series that are listed by other options
exchanges.9 This thirty (30) series
restriction would apply to Tuesday and
Thursday SPY and QQQ Short Term
Option Daily Expiration series as well.
In addition, the Exchange will be able
to list series that are listed by other
exchanges, assuming they file similar
rules with the Commission to list SPY
and QQQ options expiring on Tuesdays
and Thursdays with a limit of two
Tuesday Short Term Daily Expirations
and two Thursday Short Term Daily
Expirations.
Finally, the Exchange is amending
IM–5050–6(b)(2), to conform the rule
text to the usage of the term ‘‘Short
Term Option Daily Expirations.’’ Today,
with the exception of Monday and
Wednesday SPY Expirations, Monday
and Wednesday QQQ Expirations, and
Monday and Wednesday IWM
Expirations, no Short Term Option
Series may expire in the same week in
which monthly option series on the
same class expire. With this proposal,
Tuesday and Thursday SPY Expirations
and Tuesday and Thursday QQQ
Expirations would be treated similarly
to existing Monday and Wednesday
SPY, QQQ, and IWM Expirations. With
respect to monthly option series, Short
Term Option Daily Expirations will be
permitted to expire in the same week in
which monthly option series on the
same class expire. Not listing Short
Term Option Daily Expirations for one
week every month because there was a
monthly on that same class on the
Friday of that week would create
investor confusion.
IM–5050–6(b)(1).
9 Id.
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Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
Further, as with Monday and
Wednesday SPY, QQQ, and IWM
Expirations, the Exchange would not
permit Tuesday and Thursday Short
Term Option Daily Expirations to expire
on a business day in which monthly
options series or Quarterly Options
Series expire.10 Therefore, all Short
Term Option Daily Expirations would
expire at the close of business on each
of the next two Mondays, Tuesdays,
Wednesdays, and Thursdays,
respectively, that are business days and
are not business days in which monthly
options series or Quarterly Options
Series expire. The Exchange believes
that it is reasonable to not permit two
expirations on the same day in which a
monthly options series or a Quarterly
Options Series would expire.
The Exchange does not believe that
any market disruptions will be
encountered with the introduction of
P.M.-settled Tuesday and Thursday
Short Term Option Daily Expirations.
The Exchange has the necessary
capacity and surveillance programs in
place to support and properly monitor
trading in the proposed Tuesday and
Thursday Short Term Option Daily
Expirations. The Exchange currently
trades P.M.-settled Short Term Option
Series that expire Monday and
Wednesday for SPY, QQQ and IWM and
has not experienced any market
disruptions nor issues with capacity.
Today, the Exchange has surveillance
programs in place to support and
properly monitor trading in Short Term
Option Series that expire Monday and
Wednesday for SPY, QQQ and IWM.
The Exchange notes that Monday and
Wednesday Expirations in SPY, QQQ,
and IWM that were listed prior to the
proposed changes discussed herein will
continue to be listed on the Exchange
until those options expire pursuant to
the current Short Term Option Series
rules.
khammond on DSKJM1Z7X2PROD with NOTICES
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of section 6(b) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),11 in general, and section 6(b)(5)
of the Act,12 in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
10 While the Exchange proposes to add rule text
within IM–5050–6 with respect to Monday
Expirations, Tuesday Expirations, and Wednesdays
Expirations stating that those expirations would not
expire on business days that are business days in
which monthly options series expire, practically
speaking this would not occur.
11 15 U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(5).
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trade, to foster cooperation and
coordination with persons engaged in
facilitating transactions in securities, 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 proposal is consistent with the
Act as the overall reduction offered by
this proposal reduces the number of
Short Term Option Expirations to be
listed on the Exchange. This reduction
would remove impediments to and
perfect the mechanism of a free and
open market by encouraging Market
Makers to continue to deploy capital
more efficiently and improve market
quality. Also, the Exchange’s proposal
curtails the number of Monday,
Tuesday, Wednesday, and Thursday
expirations in SPY, QQQ, and IWM
without reducing the classes of options
available for trading on the Exchange.
The Exchange believes that despite the
proposed curtailment of expirations,
Participants will continue to be able to
expand hedging tools and tailor their
investment and hedging needs more
effectively in SPY, QQQ, and IWM.
Similar to SPY, QQQ and IWM
Monday and Wednesday Expirations
(proposed to be SPY, QQQ and IWM
Monday and Wednesday Short Term
Daily Expirations), the introduction of
SPY and QQQ Tuesday and Thursday
Short Term Daily Expirations is
consistent with the Act as it will, among
other things, expand hedging tools
available to market participants and
continue the reduction of the premium
cost of buying protection. The Exchange
believes that SPY and QQQ Tuesday
and Thursday expirations (renamed SPY
and QQQ Tuesday and Thursday Short
Term Daily Expirations) will allow
market participants to purchase SPY
and QQQ options based on their timing
as needed and allow them to tailor their
investment and hedging needs more
effectively. Further, the proposal to
permit Tuesday and Thursday Short
Term Daily Expirations for options on
SPY and QQQ listed pursuant to the
Short Term Option Series Program,
subject to the proposed limitation of two
expirations, would protect investors and
the public interest by providing the
investing public and other market
participants more flexibility to closely
tailor their investment and hedging
decisions in SPY and QQQ options, thus
allowing them to better manage their
risk exposure.
In particular, the Exchange believes
the Short Term Option Series Program
has been successful to date and that
Tuesday and Thursday SPY and QQQ
Short Term Daily Expirations should
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72575
simply expand the ability of investors to
hedge risk against market movements
stemming from economic releases or
market events that occur throughout the
month in the same way that the Short
Term Option Series Program has
expanded the landscape of hedging.
Similarly, the Exchange believes
Tuesday and Thursday SPY and QQQ
Short Term Daily Expirations should
create greater trading and hedging
opportunities and flexibility, and will
provide customers with the ability to
tailor their investment objectives more
effectively. The Exchange currently lists
Monday and Wednesday SPY, QQQ,
and IWM Expirations (renamed SPY,
QQQ, and IWM Monday and
Wednesday Short Term Daily
Expirations).
Today, with the exception of Monday
and Wednesday SPY Expirations,
Monday and Wednesday QQQ
Expirations, and Monday and
Wednesday IWM Expirations, no Short
Term Option Series may expire in the
same week in which monthly option
series on the same class expire. With
this proposal, Tuesday and Thursday
SPY Expirations and Tuesday and
Thursday QQQ Expirations would be
treated similarly to existing Monday and
Wednesday SPY, QQQ, and IWM
Expirations. The Exchange believes that
permitting Short Term Option Daily
Expirations to expire in the same week
that standard monthly options expire on
Fridays is consistent with Act. Not
listing Short Term Option Daily
Expirations for one week every month
because there was a monthly on that
same class on the Friday of that week
would create investor confusion.
Further, as with Monday and
Wednesday SPY, QQQ, and IWM
Expirations, the Exchange would not
permit Tuesday and Thursday Short
Term Option Daily Expirations to expire
on a business day in which monthly
options series or Quarterly Options
Series expire. Therefore, all Short Term
Option Daily Expirations would expire
at the close of business on each of the
next two Mondays, Tuesdays,
Wednesdays, and Thursdays,
respectively, that are business days and
are not business days in which monthly
options series or Quarterly Options
Series expire. The Exchange believes
that it is consistent with the Act to not
permit two expirations on the same day
in which a monthly options series or a
Quarterly Options Series would expire
similar to Monday and Wednesday SPY,
QQQ, and IWM Expirations.
There are no material differences in
the treatment of Wednesday SPY and
QQQ expirations for Short Term Option
Series as compared to the proposed
E:\FR\FM\25NON1.SGM
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72576
Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
khammond on DSKJM1Z7X2PROD with NOTICES
Tuesday and Thursday SPY and QQQ
Short Term Daily Expirations. Given the
similarities between Wednesday SPY,
QQQ and IWM Expirations and the
proposed Tuesday and Thursday SPY
and QQQ Short Term Daily Expirations,
the Exchange believes that applying the
provisions in IM–5050–6 that currently
apply to Wednesday SPY, QQQ and
IWM Expirations to Tuesday and
Thursday SPY and QQQ Short Term
Daily Expirations is justified.
Finally, the Exchange represents that
it has an adequate surveillance program
in place to detect manipulative trading
in the proposed Tuesday and Thursday
SPY and QQQ Short Term Daily
Expirations, in the same way that it
monitors trading in the current Short
Term Option Series and trading in
Monday and Wednesday SPY, QQQ,
and IWM Expirations. The Exchange
also represents that it has the necessary
systems capacity to support the new
options series. Finally, the Exchange
does not believe that any market
disruptions will be encountered with
the introduction of Tuesday and
Thursday SPY and QQQ Short Term
Daily Expirations.
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 not
necessary or appropriate in furtherance
of the purposes of the Act. In this regard
and as indicated above, the Exchange
notes that the rule change is being
proposed as a response to a filing
submitted by Nasdaq ISE that was
recently approved by the Commission.13
Further, the Exchange believes the
proposal will provide an overall
reduction in the number of Short Term
Option Expirations to be listed on the
Exchange. The Exchange believes this
reduction will not impose an undue
burden on competition, rather, it should
encourage Market Makers to continue to
deploy capital more efficiently and
improve market quality. Also, the
Exchange’s proposal curtails the number
of weekly expirations in SPY, QQQ, and
IWM without reducing the classes of
options available for trading on the
Exchange. The Exchange believes that
despite the proposed curtailment of
weekly expirations, Participants will
continue to be able to expand hedging
tools and tailor their investment and
hedging needs more effectively in SPY,
QQQ, and IWM.
Similar to SPY, QQQ and IWM
Monday and Wednesday Expirations,
the introduction of SPY and QQQ
13 See
supra, note 3.
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18:43 Nov 23, 2022
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Tuesday and Thursday Short Term
Daily Expirations does not impose an
undue burden on competition. The
Exchange believes that it will, among
other things, expand hedging tools
available to market participants and
continue the reduction of the premium
cost of buying protection. The Exchange
believes that SPY and QQQ Tuesday
and Thursday Short Term Daily
Expirations will allow market
participants to purchase SPY and QQQ
options based on their timing as needed
and allow them to tailor their
investment and hedging needs more
effectively.
The Exchange does not believe the
proposal will impose any burden on
inter- market competition, as nothing
prevents the other options exchanges
from proposing similar rules to list and
trade Short-Term Option Series with
Tuesday and Thursday Short Term
Daily Expirations. The Exchange notes
that having Tuesday and Thursday SPY
and QQQ expirations is not a novel
proposal, as Wednesday SPY, QQQ and
IWM Expirations are currently listed on
the Exchange.
Further, the Exchange does not
believe the proposal will impose any
burden on intra-market competition, as
all market participants will be treated in
the same manner under this proposal.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed
rule change pursuant to section
19(b)(3)(A)(iii) of the Act 14 and Rule
19b–4(f)(6) thereunder.15 Because the
foregoing 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 from the date on which it
was filed, or such shorter time as the
Commission may designate, it has
become effective pursuant to section
19(b)(3)(A)(iii) of the Act 16 and
subparagraph (f)(6) of Rule 19b–4
thereunder.17
14 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
16 15 U.S.C. 78s(b)(3)(A)(iii).
17 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
give the Commission written notice of its intent to
file the proposed rule change, along with a brief
15 17
PO 00000
Frm 00135
Fmt 4703
Sfmt 4703
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 18 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 19
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
requested that the Commission waive
the 30-day operative delay so that the
proposed rule change may become
operative upon filing. The Commission
notes that it recently approved Nasdaq
ISE’s substantially similar proposal.20
The Exchange has stated that waiver of
the 30-day operative delay will ensure
fair competition among the exchanges
and align its rules with identical rules
currently in place at another exchange.
For these reasons, the Commission
believes that the proposed rule change
presents no novel issues and that waiver
of the 30-day operative delay is
consistent with the protection of
investors and the public interest.
Accordingly, the Commission hereby
waives the operative delay and
designates the proposed rule change
operative upon filing.21
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. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
description and 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. The Exchange
has satisfied this requirement.
18 17 CFR 240.19b–4(f)(6).
19 17 CFR 240.19b–4(f)(6)(iii).
20 See Securities Exchange Act Release No. 96281
(November 9, 2022) (SR–ISE–2022–18).
21 For purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
E:\FR\FM\25NON1.SGM
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Federal Register / Vol. 87, No. 226 / Friday, November 25, 2022 / Notices
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–
BOX–2022–29 on the subject line.
Paper Comments:
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
khammond on DSKJM1Z7X2PROD with NOTICES
All submissions should refer to File
Number SR–BOX–2022–29. 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 website (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 website 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 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.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–BOX–2022–29 and should
be submitted on or before December 16,
2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.22
Sherry R. Haywood,
Assistant Secretary.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–96354]
Order Cancelling Registrations of
Certain Transfer Agents
November 18, 2022.
On September 27, 2022, notice was
published in the Federal Register that
the Securities and Exchange
Commission (‘‘Commission’’) intended
to issue an order, pursuant to section
17A(c)(4)(B) of the Securities Exchange
Act of 1934 (‘‘Act’’),1 cancelling the
registrations of certain transfer agents.2
For the reasons discussed below, the
Commission is cancelling the
registration of the transfer agents
identified in the attached Appendix.
FOR FURTHER INFORMATION CONTACT:
Moshe Rothman, Assistant Director, or
Catherine Whiting, Special Counsel, at
(202) 551–4990, U.S. Securities and
Exchange Commission, Division of
Trading and Markets, 100 F Street NE,
Washington, DC 20549 or by email to
tradingandmarkets@sec.gov with the
phrase ‘‘Order Cancelling Transfer
Agent Registration’’ in the subject line.
Background
Section 17A(c)(4)(B) of the Act
provides that if the Commission finds
that any transfer agent registered with
the Commission is no longer in
existence or has ceased to do business
as a transfer agent, the Commission
shall by order cancel that transfer
agent’s registration. On September 27,
2022, the Commission published notice
of its intention to cancel the registration
of certain transfer agents whom it
believed were no longer in existence or
had ceased doing business as transfer
agents.3
In the notice, the Commission
identified 52 such transfer agents and
stated that at any time after November
1, 2022, the Commission intended to
issue an order canceling the
registrations of any or all of the
identified transfer agents. The
Commission received no responses to
the notice.
Accordingly, the Commission is
cancelling the registrations of the 52
transfer agents identified in the
Appendix attached to this Order.
Order
On the basis of the foregoing, the
Commission finds that each of the
transfer agents whose name appears in
[FR Doc. 2022–25666 Filed 11–23–22; 8:45 am]
1 15
U.S.C. 78q–1(c)(4)(B).
Exchange Act Release No. 34–95855
(Sept. 21, 2022), 87 FR 58590 (Sept. 27, 2022).
3 Id.
BILLING CODE 8011–01–P
2 Securities
22 17
CFR 200.30–3(a)(12), (59).
VerDate Sep<11>2014
19:43 Nov 23, 2022
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Frm 00136
Fmt 4703
Sfmt 4703
72577
the attached Appendix either is no
longer in existence or has ceased doing
business as a transfer agent.
It is therefore ordered pursuant to
Section 17A(c)(4)(B) of the Act that the
registration as a transfer agent of each of
the transfer agents whose name appears
in the attached Appendix be and hereby
is cancelled.
For the Commission by the Division
of Trading and Markets pursuant to
delegated authority.4
Action as set forth or recommended
herein approved pursuant to authority
delegated by the Commission under
Public Law 87–592.
For the Division of Trading and Markets.
Moshe Rothman,
Assistant Director.
J. Matthew DeLesDernier,
Deputy Secretary.
Appendix
Transfer agent name
Advanced Fund Administration, LLC
Ameritor Financial Corp ....................
Andesa Services, Inc ........................
Bank Of Commerce & Trust Co ........
Colbent Corp .....................................
Cronos Capital Corp .........................
Donald Rivers Goolsby Whfit ............
Dynamic Transfer Services Corp ......
Fidelity Transfer Services, Inc ...........
Financial Data Services Inc ..............
First National Bank In Sioux Falls .....
Foresight Asset Management LLC ...
Gartmore Investors Services, Inc ......
Grohe Aktiengesellschaft ..................
Gulf Registrar And Transfer Corp .....
Hartford Investor Services Co LLC ...
Interstate Transfer Co .......................
M & K Produce Inc ............................
National Western Life Insurance Co
Orbitex Fund Services Inc .................
Orion Share Transfer LLC .................
Patriot Stock Transfer LLC ................
Portfolios Inc .....................................
Preferred Partnership Services Inc ...
Presidential Life Corp ........................
Pyxis Global Financial Services ........
Republic Stock Transfer Inc ..............
Reserve Fund ....................................
Reserve Management Corp ..............
Reserve Petroleum Co ......................
Reserve
Short-Term
Investment
Trust ...............................................
Retirement System Consultants Inc ..
SCC Transfer, LLC ...........................
Seligman Common Stock Fund Inc ..
Seligman Core Fixed Income Fund
Inc ..................................................
Seligman High Income Fund Series
Seligman New Jersey Municipal
Fund Inc .........................................
Seligman Pennsylvania Municipal
Fund Series Inc .............................
Seligman Select Municipal Fund Inc
Seligman Tax-Aware Fund, Inc .........
Tass LLC ...........................................
The Provo Group, Inc .......................
Travelers Rest Resort Inc .................
Truman Stock Transfer LLC ..............
Universal Stock Transfer Co., Inc .....
Wall Street Transfer Agents Inc ........
West Coast Stock Transfer, Inc ........
4 17
CFR 200.30–3(a)(22).
E:\FR\FM\25NON1.SGM
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File No.
084–06396
084–00018
084–06233
084–06235
084–05927
084–00977
084–06560
084–06394
084–06405
084–01339
084–06228
084–06051
084–06229
084–06022
084–06136
084–05882
084–05573
084–06183
084–00693
084–01493
084–06295
084–06382
084–05551
084–05747
084–00816
084–06463
084–01124
084–00449
084–05838
084–00630
084–06156
084–01972
084–06579
084–00503
084–05921
084–01266
084–01686
084–01486
084–01896
084–05894
084–06115
084–05890
084–06056
084–06320
084–06308
084–06203
084–06138
]]>Agencies
[Federal Register Volume 87, Number 226 (Friday, November 25, 2022)]
[Notices]
[Pages 72572-72577]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-25666]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-96355; File No. SR-BOX-2022-29]
Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change To Amend IM-5050-
6 (Short Term Option Series Program)
November 18, 2022.
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 November 16, 2022, BOX Exchange LLC (the ``Exchange'') filed
with the Securities and Exchange Commission (the ``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend IM-5050-6 (Short Term Option Series
Program). The text of the proposed rule change is available from the
principal office of the Exchange, at the Commission's Public Reference
Room and also on the Exchange's internet website at https://rules.boxexchange.com/rulefilings.
[[Page 72573]]
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 these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Sections A, B, and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend IM-5050-6 (Short Term Option Series
Program). Specifically, the Exchange proposes to amend the Short Term
Option Series Rules to: (1) limit the number of Short Term Option
Expiration Dates for options on SPDR S&P 500 ETF Trust (SPY), the
INVESCO QQQ Trust SM, Series 1 (QQQ), and iShares Russell 2000 ETF
(IWM) from five to two expirations for Monday and Wednesday
expirations; and (2) expand the Short Term Option Series program to
permit the listing and trading of options series with Tuesday and
Thursday expirations for options on SPY and QQQ listed pursuant to the
Short Term Option Series Program, subject to the same proposed
limitation of two expirations. The Exchange also proposes to amend Rule
100(a)(66) which defines a Short Term Option Series. This is a
competitive filing that is based on a proposal recently submitted by
Nasdaq ISE, LLC (``Nasdaq ISE'') and approved by the Commission.\3\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 96281 (November 9,
2022) (Order Approving SR-ISE-2022-18).
---------------------------------------------------------------------------
Curtail Short Term Option Expiration Dates
Currently, after an option class has been approved for listing and
trading on the Exchange, the Exchange may open for trading on any
Thursday or Friday that is a business day (``Short Term Option Opening
Date'') series of options on that class that expire at the close of
business on each of the next five Fridays that are business days and
are not Fridays in which monthly options series or Quarterly Options
Series expire (``Short Term Option Expiration Dates''). The Exchange
may have no more than a total of five Short Term Option Expiration
Dates not including any Monday or Wednesday SPY, QQQ, and IWM
Expirations. Further, if the Exchange is not open for business on the
respective Thursday or Friday, the Short Term Option Opening Date will
be the first business day immediately prior to that respective Thursday
or Friday. Similarly, if the Exchange is not open for business on a
Friday, the Short Term Option Expiration Date will be the first
business day immediately prior to that Friday.
Today, with respect to Wednesday SPY, QQQ, and IWM Expirations, the
Exchange may open for trading on any Tuesday or Wednesday that is a
business day series of options on SPY, QQQ, and IWM to expire on any
Wednesday of the month that is a business day and is not a Wednesday in
which Quarterly Options Series expire (``Wednesday SPY Expirations,''
``Wednesday QQQ Expirations,'' and ``Wednesday IWM Expirations''). With
respect to Monday SPY, QQQ, and IWM Expirations, the Exchange may open
for trading on any Friday or Monday that is a business day series of
options on the SPY, QQQ, or IWM to expire on any Monday of the month
that is a business day and is not a Monday in which Quarterly Options
Series expire (``Monday SPY Expirations,'' ``Monday QQQ Expirations,''
and ``Monday IWM Expirations''), provided that Monday SPY Expirations,
Monday QQQ Expirations, and Monday IWM Expirations that are listed on a
Friday must be listed at least one business week and one business day
prior to the expiration. The Exchange may list up to five consecutive
Wednesday SPY Expirations, Wednesday QQQ Expirations, and Wednesday IWM
Expirations and five consecutive Monday SPY Expirations, Monday QQQ
Expirations, and Monday IWM Expirations at one time; the Exchange may
have no more than a total of five each of Wednesday SPY Expirations,
Wednesday QQQ Expirations, and Wednesday IWM Expirations and a total of
five each of Monday SPY Expirations, Monday QQQ Expirations, and Monday
IWM Expirations. Monday and Wednesday SPY Expirations, Monday and
Wednesday QQQ Expirations, and Monday and Wednesday IWM Expirations
will be subject to the provisions of IM-5050-6.
Proposal
At this time, the Exchange proposes to curtail the number of Short
Term Option Expiration Dates from five to two \4\ for SPY, QQQ and IWM
for Monday and Wednesday Expirations, as well as the proposed Tuesday
and Thursday Expirations in SPY and QQQ (``Short Term Option Daily
Expirations'').
---------------------------------------------------------------------------
\4\ The Exchange proposes to list the two front months for Short
Term Option Daily Expirations.
---------------------------------------------------------------------------
The Exchange proposes to create a new category of Short Term Option
Expirations Dates called ``Short Term Option Daily Expirations'' which
will only permit two Short Term Option Expiration Dates for each of
Monday, Tuesday, Wednesday, and Thursday expirations at one time. The
Exchange proposes to include a table, labelled ``Table 1'', within IM-
5050-6(a) which specifies each symbol that qualifies as a Short Term
Option Daily Expiration. The table would note the number of expirations
for each symbol as well as expiration days. The Exchange proposes to
include Monday and Wednesday expirations for SPY, QQQ, and IWM and
Tuesday and Thursday expirations for SPY and QQQ and list the number of
expirations as ``2'' for these symbols. The Exchange's proposal to
permit Tuesday and Thursday expirations for options on SPY and QQQ
listed pursuant to the Short Term Option Series Program is explained
below in more detail. In the event Short Term Option Daily Expirations
expire on the same day in the same class as a monthly options series or
a Quarterly Options Series, the Exchange would skip that week's listing
and instead list the following week; the two weeks of Short Term Option
Expiration Dates would therefore not be consecutive. Specifically, the
Exchange proposes to state within IM-5050-6(a),
In addition to the above, BOX may open for trading series of
options on the symbols provided in Table 1 below that expire at the
close of business on each of the next two Mondays, Tuesdays,
Wednesdays, and Thursdays, respectively, that are business days and
are not business days in which monthly options series or Quarterly
Options Series expire (``Short Term Option Daily Expirations''). BOX
may have no more than a total of two Short Term Option Daily
Expirations for each of Monday, Tuesday, Wednesday, and Thursday
expirations at one time. Short Term Option Daily Expirations would
be subject to IM-5050-6.
SPY, QQQ, and IWM Friday expirations and other option symbols expiring
on a Friday that are not noted in Table 1 will continue to have a total
of five Short Term Option Expiration Dates provided those Friday
expirations are not Fridays in which monthly options series or
Quarterly Options Series expire (``Friday Short Term Option Expiration
Dates''). These expirations would be
[[Page 72574]]
referred to as ``Short Term Option Weekly Expirations'' to distinguish
them from the proposed expirations that would be subject to Short Term
Option Daily Expirations. The Exchange proposes to add rule text to IM-
5050-6(a) which states that Monday Short Term Option Expiration Dates,
Tuesday Short Term Option Expiration Dates, Wednesday Short Term Option
Expiration Dates, and Thursday Short Term Option Expiration Dates,
together with Friday Short Term Option Expiration Dates, are
collectively ``Short Term Option Expiration Dates''.\5\
---------------------------------------------------------------------------
\5\ Defining the term ``Short Term Option Expiration Dates''
will make clear that this term includes expiration dates for each
day Short Term Options are listed.
---------------------------------------------------------------------------
Tuesday and Thursday Expirations
At this time, the Exchange proposes to expand the Short Term Option
Series Program to permit the listing and trading of no more than a
total of two consecutive Tuesday and Thursday ``Tuesday Short Term
Option Daily Expirations'' and ``Thursday Short Term Option Daily
Expirations'' each for SPY and QQQ at one time. Tuesday and Thursday
Short Term Option Daily Expirations would be subject to IM-5050-6.
A Short Term Option Series means a series in an option class that
is approved for listing and trading on the Exchange in which the series
is opened for trading on any Monday, Tuesday, Wednesday, Thursday or
Friday that is a business day and that expires on the Monday, Wednesday
or Friday of the following business week that is a business day, or, in
the case of a series that is listed on a Friday and expires on a
Monday, is listed one business week and one business day prior to that
expiration. If a Tuesday, Wednesday, Thursday or Friday is not a
business day, the series may be opened (or shall expire) on the first
business day immediately prior to that Tuesday, Wednesday, Thursday or
Friday. For a series listed pursuant to this section for Monday
expiration, if a Monday is not a business day, the series shall expire
on the first business day immediately following that Monday.
The Exchange proposes to amend the definition at Rule 100(a)(66) to
accommodate the listing of options series that expire on Tuesdays and
Thursdays. Specifically, the Exchange proposes to add Tuesday and
Thursdays to the permitted expiration days, which currently include
Monday, Wednesday, and Friday, that it may open for trading.
The Exchange also proposes corresponding changes within IM-5050-6,
which sets forth the requirements for SPY and QQQ options that are
listed pursuant to the Short Term Option Series Program as Short Term
Option Daily Expirations. Similar to Monday and Wednesday SPY, QQQ, and
IWM Short Term Option Daily Expirations within IM-5050-6, the Exchange
proposes that it may open for trading on any Monday or Tuesday that is
a business day series of options on the symbols provided in Table 1
that expire at the close of business on each of the next two Tuesdays
that are business days and are not business days in which monthly
options series or Quarterly Options Series expire (``Tuesday Short Term
Option Expiration Date'').
Likewise, the Exchange proposes that it may open for trading on any
Wednesday or Thursday that is a business day series of options on
symbols provided in Table 1 that expire at the close of business on
each of the next two Thursdays that are business days and are not
business days in which monthly options series or Quarterly Options
Series expire (``Thursday Short Term Option Expiration Date'').
In the event that options on SPY and QQQ expire on a Tuesday or
Thursday and that Tuesday or Thursday is the same day that a monthly
option series or Quarterly Options Series expires, the Exchange would
skip that week's listing and instead list the following week; the two
weeks would therefore not be consecutive. Today, Monday and Wednesday
Expirations in SPY, QQQ, and IWM skip the weekly listing in the event
the weekly listing expires on the same day in the same class as a
Quarterly Options Series. Currently, there is no rule text provision
that states that Monday and Wednesday Expirations in SPY, QQQ, and IWM
skip the weekly listing in the event the weekly listing expires on the
same day in the same class as a monthly option series. Practically
speaking, Monday and Wednesday Expirations in SPY, QQQ, and IWM would
not expire on the same day as a monthly expiration.
The interval between strike prices for the proposed Tuesday and
Thursday SPY and QQQ Short Term Option Daily Expirations will be the
same as those for the current Short Term Option Series for Monday,
Wednesday and Friday expirations applicable to the Short Term Option
Series Program.\6\ Specifically, the Tuesday and Thursday SPY and QQQ
Short Term Option Daily Expirations will have a $0.50 strike interval
minimum.\7\ As is the case with other equity options series listed
pursuant to the Short Term Option Series Program, the Tuesday and
Thursday SPY and QQQ Short Term Option Daily Expiration series will be
P.M.-settled.
---------------------------------------------------------------------------
\6\ See IM-5050-6(b)(5).
\7\ Id.
---------------------------------------------------------------------------
Pursuant to Rule 100(a)(66), with respect to the Short Term Option
Series Program, a Tuesday or Thursday expiration series shall expire on
the first business day immediately prior to that Tuesday or Thursday,
e.g., Monday or Wednesday of that week, respectively, if the Tuesday or
Thursday is not a business day.
Currently, for each option class eligible for participation in the
Short Term Option Series Program, the Exchange is limited to opening
thirty (30) series for each expiration date for the specific class.\8\
The thirty (30) series restriction does not include series that are
open by other securities exchanges under their respective weekly rules;
the Exchange may list these additional series that are listed by other
options exchanges.\9\ This thirty (30) series restriction would apply
to Tuesday and Thursday SPY and QQQ Short Term Option Daily Expiration
series as well. In addition, the Exchange will be able to list series
that are listed by other exchanges, assuming they file similar rules
with the Commission to list SPY and QQQ options expiring on Tuesdays
and Thursdays with a limit of two Tuesday Short Term Daily Expirations
and two Thursday Short Term Daily Expirations.
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\8\ See IM-5050-6(b)(1).
\9\ Id.
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Finally, the Exchange is amending IM-5050-6(b)(2), to conform the
rule text to the usage of the term ``Short Term Option Daily
Expirations.'' Today, with the exception of Monday and Wednesday SPY
Expirations, Monday and Wednesday QQQ Expirations, and Monday and
Wednesday IWM Expirations, no Short Term Option Series may expire in
the same week in which monthly option series on the same class expire.
With this proposal, Tuesday and Thursday SPY Expirations and Tuesday
and Thursday QQQ Expirations would be treated similarly to existing
Monday and Wednesday SPY, QQQ, and IWM Expirations. With respect to
monthly option series, Short Term Option Daily Expirations will be
permitted to expire in the same week in which monthly option series on
the same class expire. Not listing Short Term Option Daily Expirations
for one week every month because there was a monthly on that same class
on the Friday of that week would create investor confusion.
[[Page 72575]]
Further, as with Monday and Wednesday SPY, QQQ, and IWM
Expirations, the Exchange would not permit Tuesday and Thursday Short
Term Option Daily Expirations to expire on a business day in which
monthly options series or Quarterly Options Series expire.\10\
Therefore, all Short Term Option Daily Expirations would expire at the
close of business on each of the next two Mondays, Tuesdays,
Wednesdays, and Thursdays, respectively, that are business days and are
not business days in which monthly options series or Quarterly Options
Series expire. The Exchange believes that it is reasonable to not
permit two expirations on the same day in which a monthly options
series or a Quarterly Options Series would expire.
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\10\ While the Exchange proposes to add rule text within IM-
5050-6 with respect to Monday Expirations, Tuesday Expirations, and
Wednesdays Expirations stating that those expirations would not
expire on business days that are business days in which monthly
options series expire, practically speaking this would not occur.
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The Exchange does not believe that any market disruptions will be
encountered with the introduction of P.M.-settled Tuesday and Thursday
Short Term Option Daily Expirations. The Exchange has the necessary
capacity and surveillance programs in place to support and properly
monitor trading in the proposed Tuesday and Thursday Short Term Option
Daily Expirations. The Exchange currently trades P.M.-settled Short
Term Option Series that expire Monday and Wednesday for SPY, QQQ and
IWM and has not experienced any market disruptions nor issues with
capacity. Today, the Exchange has surveillance programs in place to
support and properly monitor trading in Short Term Option Series that
expire Monday and Wednesday for SPY, QQQ and IWM. The Exchange notes
that Monday and Wednesday Expirations in SPY, QQQ, and IWM that were
listed prior to the proposed changes discussed herein will continue to
be listed on the Exchange until those options expire pursuant to the
current Short Term Option Series rules.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of section 6(b) of the Securities Exchange Act of 1934
(the ``Act''),\11\ in general, and section 6(b)(5) of the Act,\12\ in
particular, in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in facilitating transactions in securities, 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.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(5).
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The proposal is consistent with the Act as the overall reduction
offered by this proposal reduces the number of Short Term Option
Expirations to be listed on the Exchange. This reduction would remove
impediments to and perfect the mechanism of a free and open market by
encouraging Market Makers to continue to deploy capital more
efficiently and improve market quality. Also, the Exchange's proposal
curtails the number of Monday, Tuesday, Wednesday, and Thursday
expirations in SPY, QQQ, and IWM without reducing the classes of
options available for trading on the Exchange. The Exchange believes
that despite the proposed curtailment of expirations, Participants will
continue to be able to expand hedging tools and tailor their investment
and hedging needs more effectively in SPY, QQQ, and IWM.
Similar to SPY, QQQ and IWM Monday and Wednesday Expirations
(proposed to be SPY, QQQ and IWM Monday and Wednesday Short Term Daily
Expirations), the introduction of SPY and QQQ Tuesday and Thursday
Short Term Daily Expirations is consistent with the Act as it will,
among other things, expand hedging tools available to market
participants and continue the reduction of the premium cost of buying
protection. The Exchange believes that SPY and QQQ Tuesday and Thursday
expirations (renamed SPY and QQQ Tuesday and Thursday Short Term Daily
Expirations) will allow market participants to purchase SPY and QQQ
options based on their timing as needed and allow them to tailor their
investment and hedging needs more effectively. Further, the proposal to
permit Tuesday and Thursday Short Term Daily Expirations for options on
SPY and QQQ listed pursuant to the Short Term Option Series Program,
subject to the proposed limitation of two expirations, would protect
investors and the public interest by providing the investing public and
other market participants more flexibility to closely tailor their
investment and hedging decisions in SPY and QQQ options, thus allowing
them to better manage their risk exposure.
In particular, the Exchange believes the Short Term Option Series
Program has been successful to date and that Tuesday and Thursday SPY
and QQQ Short Term Daily Expirations should simply expand the ability
of investors to hedge risk against market movements stemming from
economic releases or market events that occur throughout the month in
the same way that the Short Term Option Series Program has expanded the
landscape of hedging. Similarly, the Exchange believes Tuesday and
Thursday SPY and QQQ Short Term Daily Expirations should create greater
trading and hedging opportunities and flexibility, and will provide
customers with the ability to tailor their investment objectives more
effectively. The Exchange currently lists Monday and Wednesday SPY,
QQQ, and IWM Expirations (renamed SPY, QQQ, and IWM Monday and
Wednesday Short Term Daily Expirations).
Today, with the exception of Monday and Wednesday SPY Expirations,
Monday and Wednesday QQQ Expirations, and Monday and Wednesday IWM
Expirations, no Short Term Option Series may expire in the same week in
which monthly option series on the same class expire. With this
proposal, Tuesday and Thursday SPY Expirations and Tuesday and Thursday
QQQ Expirations would be treated similarly to existing Monday and
Wednesday SPY, QQQ, and IWM Expirations. The Exchange believes that
permitting Short Term Option Daily Expirations to expire in the same
week that standard monthly options expire on Fridays is consistent with
Act. Not listing Short Term Option Daily Expirations for one week every
month because there was a monthly on that same class on the Friday of
that week would create investor confusion.
Further, as with Monday and Wednesday SPY, QQQ, and IWM
Expirations, the Exchange would not permit Tuesday and Thursday Short
Term Option Daily Expirations to expire on a business day in which
monthly options series or Quarterly Options Series expire. Therefore,
all Short Term Option Daily Expirations would expire at the close of
business on each of the next two Mondays, Tuesdays, Wednesdays, and
Thursdays, respectively, that are business days and are not business
days in which monthly options series or Quarterly Options Series
expire. The Exchange believes that it is consistent with the Act to not
permit two expirations on the same day in which a monthly options
series or a Quarterly Options Series would expire similar to Monday and
Wednesday SPY, QQQ, and IWM Expirations.
There are no material differences in the treatment of Wednesday SPY
and QQQ expirations for Short Term Option Series as compared to the
proposed
[[Page 72576]]
Tuesday and Thursday SPY and QQQ Short Term Daily Expirations. Given
the similarities between Wednesday SPY, QQQ and IWM Expirations and the
proposed Tuesday and Thursday SPY and QQQ Short Term Daily Expirations,
the Exchange believes that applying the provisions in IM-5050-6 that
currently apply to Wednesday SPY, QQQ and IWM Expirations to Tuesday
and Thursday SPY and QQQ Short Term Daily Expirations is justified.
Finally, the Exchange represents that it has an adequate
surveillance program in place to detect manipulative trading in the
proposed Tuesday and Thursday SPY and QQQ Short Term Daily Expirations,
in the same way that it monitors trading in the current Short Term
Option Series and trading in Monday and Wednesday SPY, QQQ, and IWM
Expirations. The Exchange also represents that it has the necessary
systems capacity to support the new options series. Finally, the
Exchange does not believe that any market disruptions will be
encountered with the introduction of Tuesday and Thursday SPY and QQQ
Short Term Daily Expirations.
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 not necessary or appropriate in
furtherance of the purposes of the Act. In this regard and as indicated
above, the Exchange notes that the rule change is being proposed as a
response to a filing submitted by Nasdaq ISE that was recently approved
by the Commission.\13\
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\13\ See supra, note 3.
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Further, the Exchange believes the proposal will provide an overall
reduction in the number of Short Term Option Expirations to be listed
on the Exchange. The Exchange believes this reduction will not impose
an undue burden on competition, rather, it should encourage Market
Makers to continue to deploy capital more efficiently and improve
market quality. Also, the Exchange's proposal curtails the number of
weekly expirations in SPY, QQQ, and IWM without reducing the classes of
options available for trading on the Exchange. The Exchange believes
that despite the proposed curtailment of weekly expirations,
Participants will continue to be able to expand hedging tools and
tailor their investment and hedging needs more effectively in SPY, QQQ,
and IWM.
Similar to SPY, QQQ and IWM Monday and Wednesday Expirations, the
introduction of SPY and QQQ Tuesday and Thursday Short Term Daily
Expirations does not impose an undue burden on competition. The
Exchange believes that it will, among other things, expand hedging
tools available to market participants and continue the reduction of
the premium cost of buying protection. The Exchange believes that SPY
and QQQ Tuesday and Thursday Short Term Daily Expirations will allow
market participants to purchase SPY and QQQ options based on their
timing as needed and allow them to tailor their investment and hedging
needs more effectively.
The Exchange does not believe the proposal will impose any burden
on inter- market competition, as nothing prevents the other options
exchanges from proposing similar rules to list and trade Short-Term
Option Series with Tuesday and Thursday Short Term Daily Expirations.
The Exchange notes that having Tuesday and Thursday SPY and QQQ
expirations is not a novel proposal, as Wednesday SPY, QQQ and IWM
Expirations are currently listed on the Exchange.
Further, the Exchange does not believe the proposal will impose any
burden on intra-market competition, as all market participants will be
treated in the same manner under this proposal.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to section
19(b)(3)(A)(iii) of the Act \14\ and Rule 19b-4(f)(6) thereunder.\15\
Because the foregoing 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 from the date on which it was filed, or such shorter time as
the Commission may designate, it has become effective pursuant to
section 19(b)(3)(A)(iii) of the Act \16\ and subparagraph (f)(6) of
Rule 19b-4 thereunder.\17\
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\14\ 15 U.S.C. 78s(b)(3)(A)(iii).
\15\ 17 CFR 240.19b-4(f)(6).
\16\ 15 U.S.C. 78s(b)(3)(A)(iii).
\17\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and 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.
The Exchange has satisfied this requirement.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \18\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \19\ 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 requested that the Commission waive the 30-day operative delay so
that the proposed rule change may become operative upon filing. The
Commission notes that it recently approved Nasdaq ISE's substantially
similar proposal.\20\ The Exchange has stated that waiver of the 30-day
operative delay will ensure fair competition among the exchanges and
align its rules with identical rules currently in place at another
exchange. For these reasons, the Commission believes that the proposed
rule change presents no novel issues and that waiver of the 30-day
operative delay is consistent with the protection of investors and the
public interest. Accordingly, the Commission hereby waives the
operative delay and designates the proposed rule change operative upon
filing.\21\
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\18\ 17 CFR 240.19b-4(f)(6).
\19\ 17 CFR 240.19b-4(f)(6)(iii).
\20\ See Securities Exchange Act Release No. 96281 (November 9,
2022) (SR-ISE-2022-18).
\21\ For purposes only of waiving the 30-day operative delay,
the Commission has also 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. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
[[Page 72577]]
Electronic Comments:
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-BOX-2022-29 on the subject line.
Paper Comments:
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to File Number SR-BOX-2022-29. 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 website (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 website 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 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-BOX-2022-29 and should be submitted on
or before December 16, 2022.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
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\22\ 17 CFR 200.30-3(a)(12), (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2022-25666 Filed 11-23-22; 8:45 am]
BILLING CODE 8011-01-P
