Notice2024-26415
Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 903 To Allow For the Interval Between Strike Prices of Series of Options on Shares of the SPDR Gold Shares to be $1 or Greater and To Expand the Short Term Option Series Program To Permit the Listing of Two Monday Expirations for Options on Shares of the SPDR Gold Shares, iShares Silver Trust, and iShares 20+ Year Treasury Bond ETF
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 14, 2024
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 89 Issue 220 (Thursday, November 14, 2024)</title>
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[Federal Register Volume 89, Number 220 (Thursday, November 14, 2024)]
[Notices]
[Pages 90196-90201]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-26415]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-101555; File No. SR-NYSEAMER-2024-65]
Self-Regulatory Organizations; NYSE American LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend
Rule 903 To Allow For the Interval Between Strike Prices of Series of
Options on Shares of the SPDR Gold Shares to be $1 or Greater and To
Expand the Short Term Option Series Program To Permit the Listing of
Two Monday Expirations for Options on Shares of the SPDR Gold Shares,
iShares Silver Trust, and iShares 20+ Year Treasury Bond ETF
November 7, 2024.
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 November 4, 2024, NYSE American LLC (``Exchange'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II 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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 903 (Series of Options Open For
Trading). The proposed rule change is available on the Exchange's
website at <a href="http://www.nyse.com">www.nyse.com</a>, 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.
[[Page 90197]]
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of this filing is to amend Rule 903 (Series of Options
Open For Trading). Specifically, the Exchange proposes to allow for the
interval between strike prices of series of options on shares of SPDR
Gold Shares (``GLD'') to be $1 or greater, including where the strike
price is greater than $200, and to expand the Short Term Option Series
(``STOS'') Program to permit the listing of two Monday expirations for
options on GLD, iShares Silver Trust (``SLV''), and iShares 20+ Year
Treasury Bond ETF (``TLT''). Both proposed changes are competitive and
based on proposals submitted by Nasdaq ISE, LLC (``Nasdaq ISE'') and
approved by the Commission.\4\
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\4\ See Securities Exchange Act Release Nos. 100447 (June 28,
2024), 89 FR 55239 (July 3, 2024) (SR-ISE-2024-17) (Order Approving
a Proposed Rule Change To Amend the Strike Interval for Options on
Exchange-Traded Fund Shares and To Allow $1 Strike Price Intervals
Above $200 for Options on SPDR Gold Shares (GLD)) (``Nasdaq ISE GLD
Approval''); and 100837 (August 27, 2024), 89 FR 71770 (September 3,
2024) (SR-ISE-2024-21) (Notice of Filing of Amendment No. 1 and
Order Granting Accelerated Approval of a Proposed Rule Change, as
Modified by Amendment No. 1, to Adopt Rules to Permit the Listing of
Two Monday Expirations for Options on SPDR Gold Shares, iShares
Silver Trust, and iShares 20+ Year Treasury Bond ETF) (``Nasdaq ISE
Monday Approval'', and collectively, ``Nasdaq ISE Approval
Orders'').
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Expand $1 Strike Intervals for GLD
First, the Exchange proposes to amend Rule 903 to allow for the
interval between strike prices of series of options on GLD to be $1 or
greater, including where the strike price is greater than $200, which
would align Exchange rules with that of at least one of its
competitors.\5\
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\5\ See Nasdaq ISE GLD Approval.
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Currently, Commentary .05(a) provides that for series of options on
Exchange-Traded Fund Shares, ``the interval of strike prices may be $1
or greater where the strike price is $200 or less or $5 or greater
where the strike price is over $200.''
Further, Commentary .05(d) provides that, notwithstanding any other
provision of Rule 903 regarding the interval of strike prices of series
of options on Exchange-Traded Fund Shares, the interval of strike
prices on options on SPDR[supreg] S&P 500[supreg] ETF (``SPY''),
iShares Core S&P 500 ETF (``IVV''), PowerShares QQQ Trust (``QQQ''),
iShares Russell 2000 Index Fund (``IWM''), and the SPDR[supreg] Dow
Jones[supreg] Industrial Average ETF (``DIA'') will be $1 or greater.
The Exchange proposes to modify the interval setting regime to be
$1 or greater for GLD options, which would align GLD with SPY, IVV,
QQQ, IWM and DIA.\6\ The Exchange believes that the proposed rule
change would make GLD options easier for investors and traders to use
and more tailored to their investment needs. GLD is an Exchange-Traded
Fund Shares designed to closely track the price and performance of the
price of gold bullion. GLD is widely quoted as an indicator of gold
stock prices and is a significant indicator of overall economic health.
Investors use GLD to diversify their portfolios and benefit from market
trends. Additionally, GLD is a leading product in its asset class that
trades within a ``complex'' where, in addition to the underlying
security, there are multiple instruments available for hedging such as,
COMEX Gold Futures; Gold Daily Futures; iShares GOLD Trust; SPDR GOLD
Minishares Trust; Aberdeen Physical Gold Trust; and GraniteShares Gold
Shares.
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\6\ See proposed Rule 903, Commentary .05(d) (including GLD in
the list of ETFs eligible for strike prices of $1 or greater,
including when the strike price is greater than $200.
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Accordingly, the Exchange believes that offering a wider base of
GLD options affords traders and investors important hedging and trading
opportunities, particularly in the midst of current price trends. The
Exchange believes that not having the proposed $1 strike price
intervals above $200 in GLD significantly constricts investors' hedging
and trading possibilities. The Exchange therefore believes that by
having smaller strike intervals in GLD, investors would have more
efficient hedging and trading opportunities due to the lower $1
interval ascension. The proposed $1 interval above the $200 strike
price, will result in having at-the-money series based upon the
underlying Exchange-Traded Fund Share moving less than 1%. The Exchange
believes that the proposed strike setting regime is in line with the
slower movements of broad-based indices. Given that $1 intervals
already exist below the $200 price point and that GLD have consistently
inclined in price toward the $200 level, the Exchange believes that
continuing to maintain the current $200 level (above which intervals
increase 500% to $5), may have a negative effect on investing, trading
and hedging opportunities, and volume. The Exchange believes that the
investing, trading, and hedging opportunities available with GLD
options far outweighs any potential negative impact of allowing GLD
options to trade in more finely tailored intervals above the $200 price
point.
The proposed strike setting regime would permit strikes to be set
to more closely reflect the increasing value in the underlying and
allows investors and traders to roll open positions from a lower strike
to a higher strike in conjunction with the price movements of the
underlying ETF. Under the current rule, where the next higher available
series would be $5 away above a $200 strike price, the ability to roll
such positions would be impaired. Accordingly, to move a position from
a $200 strike to a $205 strike under the current rule, an investor
would need for the underlying product to move 2.5% and would not be
able to execute a roll up until such a large movement occurred. The
Exchange believes that with the proposed rule change, the investor
would be in a significantly safer position of being able to roll his
open options position from a $200 to a $201 strike price, which is only
a 0.5% move for the underlying. As a result, the proposed rule change
will allow the Exchange to better respond to customer demand for GLD
strike price more precisely aligned with the smaller, longer-term
incremental increases in the underlying ETF. The Exchange believes that
the proposed rule change, like the other strike price programs
currently offered by the Exchange, will benefit investors by providing
investors the flexibility to more closely tailor their investment and
hedging decisions using GLD options.
Moreover, by allowing series of GLD options to be listed in $1
intervals between strike prices over $200, the proposal will moderately
augment the potential total number of options series available on the
Exchange. However, the Exchange believes it and the Options Price
Reporting Authority (``OPRA'') have the necessary systems capacity to
handle any potential additional traffic associated with this proposed
rule change. The Exchange also believes that market participants will
not have a capacity issue due to the proposed rule change. In addition,
the Exchange represents that it does not believe that this expansion
will cause fragmentation of liquidity, but rather, believes that finer
strike intervals will serve to increase liquidity available as well as
price efficiency by providing more trading opportunities for all market
participants.
Expand STOS Program To Add Monday Expirations
The Exchange proposes to expand the Short Term Option Daily
Expirations to permit the listing of two Monday
[[Page 90198]]
expirations of options on GLD, SLV, and TLT (collectively ``Exchange
Traded Products'' or ``ETPs''),\7\ which would align Exchange rules
with that of at least one of its competitors.\8\
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\7\ Today, the Exchange permits the listing of two Wednesday
expirations for options on United States Oil Fund, LP (``USO''),
United States Natural Gas Fund, LP (``UNG''), GLD, SLV, and TLT. See
Securities Exchange Act Release No. 100272 (June 4, 2024), 89 FR
48925 (June 10, 2024) (SR-NYSEAMER-2024-34).
\8\ See Nasdaq ISE Monday Approval.
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Currently, as set forth in Rule 903(h), 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 on which standard expiration
options series, Monthly Options Series, or Quarterly Options Series
expire (``Friday Short Term Option Expiration Dates''). The Exchange
may have no more than a total of five Short Term Option Expiration
Dates. Further, if the Exchange is not open for business on the
respective Thursday or Friday, the Short Term Option Opening Date for
Short Term Option Weekly Expirations 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 for Short Term Option Weekly Expirations will be
the first business day immediately prior to that Friday.
Additionally, the Exchange may open for trading series of options
on the symbols provided in Table 1 of Commentary .10(f) to Rule 903
(``Table 1'') 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'').\9\ For those symbols listed in Table 1, the Exchange
may have no more than a total of two Short Term Option Daily
Expirations beyond the current week for each of Monday, Tuesday,
Wednesday, and Thursday expirations, as applicable, at one time.
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\9\ As set forth in Table 1, the Exchange currently only permits
Wednesday expirations for USO, UNG, GLD, SLV, and TLT.
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At this time, the Exchange proposes to expand the Short Term Option
Daily Expirations to permit the listing and trading of options on GLD,
SLV, and TLT expiring on Mondays. The Exchange proposes to permit two
Short Term Option Expiration Dates beyond the current week for each
Monday expiration at one time, and would update Table 1 for each of
those symbols accordingly.\10\
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\10\ See proposed Commentary .10(f) to Rule 903 (updating Table
1).
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The proposed Monday GLD, SLV, and TLT expirations will be similar
to the current Monday SPY, QQQ, and IWM Short Term Option Daily
Expirations set forth in Rule 903(h), such that the Exchange may open
for trading on any Friday or Monday that is a business day (beyond the
current week) series of options on GLD, SLV, and TLT to expire on any
Monday of the month that is a business day and is not a Monday on which
standard expiration options series, Monthly Options Series, or
Quarterly Options Series expire, provided that Monday expirations that
are listed on a Friday must be listed at least one business week and
one business day prior to the expiration (``Monday GLD Expirations,''
``Monday SLV Expirations,'' and ``Monday TLT Expirations'')
(collectively, ``Monday ETP Expirations'').\11\ In the event Short Term
Option Daily Expirations expire on a Monday and that Monday is the same
day that a standard expiration options series, Monthly Options 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 expirations in SPY, QQQ,
and IWM similarly skip the weekly listing in the event the weekly
listing expires on the same day in the same class as a standard
expiration options series, Monthly Options Series, or Quarterly Options
Series.
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\11\ Today, USO, UNG, GLD, SLV, and TLT may trade on Wednesdays.
See id. They may also trade on Fridays, as is the case for all
options series in the STOS Program.
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The interval between strike prices for the proposed Monday ETP
Expirations will be the same as those currently applicable the STOS
Program.\12\ Specifically, the Monday ETP Expirations will have a
strike interval of (i) $0.50 or greater for strike prices below $100,
and $1 or greater for strike prices between $100 and $150 for all
option classes that participate in the STOS Program, (ii) $0.50 for
option classes that trade in one dollar increments and are in the STOS
Program, or (iii) $2.50 or greater for strike prices above $150.\13\ As
is the case with other equity options series listed pursuant to the
STOS Program, the Monday ETP Expirations series will be P.M.-settled.
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\12\ See Commentary .10(e) to Rule 903.
\13\ See Commentary .10(d) to Rule 903.
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Pursuant to Rule 903(h), with respect to the STOS Program, if a
Monday is not a business day, the series will expire on the first
business day immediately following that Monday.
Currently, for each option class eligible for participation in the
STOS Program, the Exchange is limited to opening thirty (30) series for
each expiration date for the specific class.\14\ 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.\15\
With the proposed changes, this thirty (30) series restriction would
apply to Monday GLD, SLV, and TLT Short Term Option Daily Expirations
as well. In addition, the Exchange will be able to list series that are
listed by other exchanges, assuming that they file similar rules with
the Commission to list Monday ETP Expirations.
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\14\ See Commentary .07(c) to Rule 903.
\15\ Id.
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With this proposal, Monday ETP Expirations would be treated
similarly to existing Monday SPY, QQQ, and IWM Expirations. With
respect to standard expiration options 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.
Further, as with Monday SPY, QQQ, and IWM Expirations, the Exchange
would not permit Monday ETP Expirations to expire on a business day in
which standard expiration options series, Monthly Options Series, or
Quarterly Options Series expire.\16\ 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 beyond the current week and are not business
days in which standard expiration option series, 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 standard expiration option series, Monthly Options Series, a
Quarterly Options Series would expire
[[Page 90199]]
because those options would be duplicative of each other.
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\16\ See Commentary .10(f) to Rule 903.
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The Exchange does not believe that any market disruptions will be
encountered with the introduction of Monday ETP Expirations. The
Exchange currently trades P.M.-settled Short Term Option Series that
expire on Monday for SPY, QQQ, and IWM and has not experienced any
market disruptions nor issues with capacity. In addition, the Exchange
has not experienced any market disruptions or issues with capacity in
expanding the five ETPs to the Wednesday expirations.\17\ Today, the
Exchange has surveillance programs in place to support and properly
monitor trading in Short Term Option Series that expire Monday for SPY,
QQQ, and IWM. Further, the Exchange has the necessary capacity and
surveillance programs in place to support and properly monitor trading
in the proposed Monday ETP Expirations.
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\17\ The currently Exchange permits the listing of two Wednesday
expirations for options on GLD, SLV, and TLT. See id.
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Because the Exchange proposes to limit the number of Monday
Expirations for options on GLD, SLV, and TLT to two expirations beyond
the current week, the Exchange believes that the addition of these
Monday ETP Expirations should encourage Market-Makers to continue to
deploy capital more efficiently and improve displayed market quality.
Similar to SPY, QQQ and IWM Monday Expirations, the introduction of
Monday ETP Expirations will, among other things, expand hedging tools
available to market participants and allow for a reduced premium cost
of buying portfolio protection. The Exchange believes that Monday ETP
Expirations will allow market participants to hedge their portfolios
with options on commodities (gold and silver) as well as treasury
securities, and tailor their investment and hedging needs more
effectively.
2. Statutory Basis
The Exchange believes that its proposed rule change is consistent
with the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\18\ Specifically, the Exchange believes that its proposed rule
change is consistent with Section 6(b)(5) \19\ requirements 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 regulating,
clearing, settling, processing information with respect to, and
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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\18\ 15 U.S.C. 78f(b)
\19\ 15 U.S.C. 78f(b)(5).
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Expand $1 Strike Intervals for GLD
The Exchange believes the proposal to expand $1 strike intervals
for GLD to include where the strike price is greater than $200 is
consistent with Section 6(b)(5) of the Act and will promote just and
equitable principles of trade because it will allow investors to use
GLD options more easily, regardless of the strike price. The proposal
will allow investors to better trade and hedge positions in GLD options
where the strike price is greater than $200, thus ensuring that
investors in both options are not at a disadvantage simply because of
the strike price.
The Exchange believes the proposed rule change is consistent with
Section 6(b)(1) of the Act, which provides that the Exchange be
organized and have the capacity to be able to carry out the purposes of
the Act and the rules and regulations thereunder, and the rules of the
Exchange.\20\ The proposal allows the Exchange to respond to customer
demand to allow GLD options to trade in $1 intervals above a $200
strike price. The Exchange does not believe that the proposed rule
would create additional capacity issues or affect market functionality.
As noted above, ETF options trade in wider $5 intervals above a $200
strike price, whereby options at or below a $200 strike price trade in
$1 intervals. This creates a situation where contracts on the same
option class effectively may not be able to execute certain strategies
such as, for example, rolling to a higher strike price, simply because
of the $200 strike price above which options intervals increase by
500%. This proposal remedies the situation by establishing an exception
to the current ETF interval regime for GLD options to allow such
options to trade in $1 or greater intervals at all strike prices.
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\20\ 15 U.S.C. 78f(b)(1).
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The Exchange believes that the proposed rule change, like other
strike price programs currently offered by the Exchange, will benefit
investors by giving them increased flexibility to more closely tailor
their investment and hedging decisions. By way of example, GLD is a
leading product in its asset class and it trades within a ``complex''
where, in addition to the underlying security, there are multiple
instruments available for hedging such as, COMEX Gold Futures; Gold
Daily Futures; iShares GOLD Trust; SPDR GOLD Minishares Trust; Aberdeen
Physical Gold Trust; and GraniteShares Gold Shares.
With regard to the impact of this proposal on system capacity, the
Exchange believes it and OPRA have the necessary systems capacity to
handle any potential additional traffic associated with this proposed
rule change. The Exchange believes that its TPHs will not have a
capacity issue as a result of this proposal. Further, the Exchange does
not believe the proposal does not unfairly discriminate among market
participants, as all market participants will be treated in the same
manner under this proposal.
Finally, the Exchange notes the proposed rule change is
substantively identical to an approved Nasdaq ISE rule.\21\
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\21\ See Nasdaq ISE GLD Approval.
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Expand STOS Program To Add Monday Expirations
Similar to Monday expirations in SPY, QQQ, and IWM, the proposal to
permit Monday ETP Expirations, subject to the proposed limitation of
two expirations beyond the current week, would protect investors and
the public interest by providing the investing public and other market
participants more choice and flexibility to closely tailor their
investment and hedging decisions in these options and allow for a
reduced premium cost of buying portfolio protection, thus allowing them
to better manage their risk exposure. The Exchange believes that there
is general demand for alternative expirations in these symbols.
The Exchange represents that it has an adequate surveillance
program in place to detect manipulative trading in the proposed option
expirations, in the same way that it monitors trading in the current
Short Term Option Series for Monday SPY, QQQ and IWM expirations. The
Exchange also represents that it has the necessary system capacity to
support the new expirations. Finally, the Exchange does not believe
that any market disruptions will be encountered with the introduction
of these option expirations. As discussed above, the Exchange believes
that its proposal is a modest expansion of weekly expiration dates for
GLD, SLV, and TLT given that it will be limited to two Monday
expirations beyond the current week.
The Exchange believes that the proposal is consistent with the Act
as
[[Page 90200]]
the proposal would overall add a small number of Monday ETP Expirations
by limiting the addition of two Wednesday expirations beyond the
current week. The addition of Monday ETP Expirations 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. The Exchange believes that the
proposal will allow market participants to expand hedging tools and
tailor their investment and hedging needs more effectively in GLD, SLV,
and TLT as these funds are most likely to be utilized by market
participants to hedge the underlying asset classes. The ETPs currently
trade within ``complexes'' where, in addition to the underlying
security, there are multiple instruments available for hedging. Given
the multi-asset class nature of these products and available hedges in
highly correlated instruments, the Exchange believes that its proposal
to add Monday expirations on these products will provide market
participants with additional useful hedging tools for the underlying
asset classes.
Similar to Monday SPY, QQQ, and IWM expirations, the introduction
of Monday ETP Expirations is consistent with the Act as it will, among
other things, expand hedging tools available to market participants and
allow for a reduced premium cost of buying portfolio protection. The
Exchange believes that Monday ETP Expirations will allow market
participants to purchase options on GLD, SLV, and TLT based on their
timing as needed and allow them to tailor their investment and hedging
needs more effectively, thus allowing them to better manage their risk
exposure. Today, the Exchange lists Monday SPY, QQQ, and IWM
Expirations.\22\ In particular, the Exchange believes the STOS Program
has been successful to date and that Monday ETP 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 STOS Program has expanded
the landscape of hedging.
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\22\ See Commentary .10(f) to Rule 903, Table 1.
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There are no material differences in the treatment of Monday SPY,
QQQ, and IWM expirations compared to the proposed Monday ETP
Expirations. Given the similarities between Monday SPY, QQQ, and IWM
expirations and the proposed Monday ETP Expirations, the Exchange
believes that applying the provisions in Commentary .10(f) to Rule 903,
that currently apply to Monday SPY, QQQ, and IWM expirations is
justified. For example, the Exchange believes that allowing Monday ETP
Expirations and monthly ETP expirations in the same week will benefit
investors and minimize investor confusion by providing Monday ETP
Expirations in a continuous and uniform manner.
Finally, the Exchange notes the proposed rule change is
substantively identical to an approved Nasdaq ISE rule.\23\
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\23\ See Nasdaq ISE Monday Approval.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule changes will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
Expand $1 Strike Intervals for GLD
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. Rather, the Exchange
believes that the proposed rule change will result in additional
investment options and opportunities to achieve the investment and
trading objectives of market participants seeking efficient trading and
hedging vehicles, to the benefit of investors, market participants, and
the marketplace in general. Specifically, the Exchange believes that
GLD options investors and traders will significantly benefit from the
availability of finer strike price intervals above a $200 price point.
In addition, the interval setting regime the Exchange proposes to apply
to GLD options is currently applied to SPY, IVV, QQQ, IWM and DIA
options, which are similarly popular and widely traded ETF products and
track indexes at similarly high price levels. Thus, the proposed strike
setting regime for GLD options will allow options on this actively
traded ETF with index levels at corresponding price levels to trade
pursuant to the same strike setting regime. This will permit investors
to employ similar investment and hedging strategies for each of these
options.
The Exchange does not believe the proposal will impose any burden
on intermarket competition, as nothing prevents other options exchanges
from proposing similar rules to make a finer strike price intervals
above a $200 price point available for GLD options. The Exchange notes
that the proposed rule change is not a novel proposal, as the
Commission recently approved a substantively identical proposal of
another exchange.\6\ Further, the Exchange does not believe the
proposal will impose any burden on intramarket competition, as all
market participants will be treated in the same manner under this
proposal.
Expand STOS Program To Add Monday Expirations
While the proposal will expand the Short Term Options Expirations
to allow Monday ETP Expirations to be listed on the Exchange, the
Exchange believes that this limited expansion for Monday expirations
for options on GLD, SLV, and TLT will not impose an undue burden on
competition; rather, it will meet customer demand. The Exchange
believes that market participants will continue to be able to expand
hedging tools and tailor their investment and hedging needs more
effectively in GLD, SLV, and TLT.
Similar to Monday SPY, QQQ, and IWM expirations, the introduction
of Monday ETP 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 allow for a
reduced premium cost of buying portfolio protection. The Exchange
believes that Monday ETP Expirations will allow market participants to
purchase options on GLD, SLV, and TLT 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 Monday ETP
Expirations. As noted above, the Commission recently approved a
substantively identical proposal of another exchange.\24\ Further, the
Exchange does not believe the proposal will impose any burden on
intramarket competition, as all market participants will be treated in
the same manner under this proposal.
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\24\ See Nasdaq ISE Monday Approval.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
[[Page 90201]]
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
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) of the Act \25\ and Rule 19b-
4(f)(6) thereunder.\26\
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\25\ 15 U.S.C. 78s(b)(3)(A).
\26\ 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 normally does not become operative for 30 days after the date of
its filing. However, Rule 19b-4(f)(6)(iii) \27\ 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 proposal may become operative immediately upon filing. According to
the Exchange, waiver of the operative delay will ensure fair
competition among the exchanges by allowing the Exchange to implement
its proposal without delay, thus creating competition among Short Term
Option Series throughout the industry, which will ultimately benefit
investors. The proposed rule change raises no novel legal or regulatory
issues. Thus, the Commission believes 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 30-day
operative delay and designates the proposed rule change operative upon
filing.\28\
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\27\ 17 CFR 240.19b-4(f)(6)(iii).
\28\ 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 such 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:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#2654534a430b45494b4b434852556655434508414950"><span class="__cf_email__" data-cfemail="ff8d8a939ad29c9092929a918b8cbf8c9a9cd1989089">[email protected]</span></a>. Please include
file number SR-NYSEAMER-2024-65 on the subject line.
Paper Comments
<bullet> 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-NYSEAMER-2024-65. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). 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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-NYSEAMER-2024-65 and should
be submitted on or before December 5, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\29\
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\29\ 17 CFR 200.30-3(a)(12), (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-26415 Filed 11-13-24; 8:45 am]
BILLING CODE 8011-01-P
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</html>Indexed from Federal Register on November 14, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.