Notice2025-24055
Self-Regulatory Organizations; Cboe Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To Allow for Extended Trading of Multi-Listed Equity Options
Primary source
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Published
December 31, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 247 (Wednesday, December 31, 2025)</title>
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[Federal Register Volume 90, Number 247 (Wednesday, December 31, 2025)]
[Notices]
[Pages 61454-61456]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-24055]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104509; File No. SR-CBOE-2025-079]
Self-Regulatory Organizations; Cboe Exchange, Inc.; Order
Instituting Proceedings To Determine Whether To Approve or Disapprove a
Proposed Rule Change To Allow for Extended Trading of Multi-Listed
Equity Options
December 23, 2025.
I. Introduction
On September 30, 2025, Cboe Exchange, Inc. (``Exchange'' or
``Cboe'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) \1\ of the Securities
Exchange Act of 1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ a
proposed rule change to amend Cboe Rule (``Rule'') 5.1(c) (Global
Trading Hours (``GTH'')) to allow for extended trading sessions of
multi-listed equity options that meet certain eligibility criteria. The
proposed rule change was published for comment in the Federal Register
on October 3, 2025.\4\ On November 3, 2025, pursuant to Section
19(b)(2)(A)(ii)(I) of the Act,\5\ the Commission designated a longer
period within which to approve the proposed rule change, disapprove the
proposed rule change, or institute proceedings to determine whether to
disapprove the proposed rule change.\6\ Pursuant to Section 19(b)(2)(B)
of the Act,\7\ the Commission is hereby instituting proceedings to
determine whether to approve or disapprove the proposed rule change.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
\4\ See Securities Exchange Act Release No. 104160 (September
30, 2025), 90 FR 48091 (``Notice''). Comments received on the
proposed rule change are available at <a href="http://www.sec.gov/rules-regulations/public-comments/sr-cboe-2025-079">www.sec.gov/rules-regulations/public-comments/sr-cboe-2025-079</a>.
\5\ See 15 U.S.C. 78s(b)(2)(A)(ii)(I).
\6\ See Securities Exchange Act Release No. 104173, 90 FR 51424
(November 17, 2025). The Commission designated January 1, 2026, as
the date by which the Commission shall approve or disapprove, or
institute proceedings to determine whether to disapprove, the
proposed rule change.
\7\ 15 U.S.C. 78s(b)(2)(B).
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II. Description of the Proposed Rule Change
Pursuant to Rule 5.1, the Exchange offers three trading sessions:
(i) Regular Trading Hours (``RTH''); (ii) Curb Trading Hours
(``Curb''); and (iii) GTH.\8\ Under Rule 5.1(c) currently, the Exchange
may designate as eligible for trading during GTH any exclusively listed
index option designated for trading under Chapter 4, Section B of the
Exchange's rules.\9\ If the Exchange designates a class of index
options as eligible for trading during GTH, FLEX Options with the same
underlying index are also deemed eligible for trading during GTH.\10\
Trading in GTH for index options occurs from 8:15 p.m. to 9:25 a.m. the
next day, Monday through Friday.\11\ For multi-listed equity options,
trading currently only takes place during RTH from 9:30 a.m. through
4:00 p.m.\12\
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\8\ See Notice, supra note 4, at 48091.
\9\ See id.
\10\ See Rule 5.1(c)(1).
\11\ See Notice, supra note 4, at 48091.
\12\ See id. at 48092.
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As discussed more fully in the Notice, the Exchange proposes to
amend Rule 5.1(c) to allow for extended trading sessions of multi-
listed equity options that meet certain eligibility criteria--and FLEX
Options with the same underlying equity security--during GTH.\13\
Specifically, under the proposal, the Exchange would permit trading
Monday through Friday in designated equity options prior to the
commencement of RTH.\14\ The proposed pre-RTH hours for the designated
equity options would be from 7:30 a.m. to 9:25 a.m.\15\ In addition,
for designated equity options that are not options on ETFs, ETNs, Index
Portfolio Shares, Index Portfolio Receipts, or Trust Issued Receipts,
the Exchange proposes to offer trading until 4:15 p.m., through a
session occurring immediately after RTH from 4:00 p.m. to 4:15 p.m.,
Monday through Friday.\16\
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\13\ See proposed Rule 5.1(c). The Commission notes that the
terms ``Global Trading Hours'' or ``GTH'' are currently used by
Exchange rules to refer to the trading of exclusively-listed index
options from 8:15 p.m. to 9:25 a.m. the next day, Monday through
Friday. The proposal uses, and the Commission replicates herein,
those same terms to refer to the proposed extended trading sessions
for multi-listed equity options even though these proposed extended
sessions would not be coterminous with index option Global Trading
Hours.
\14\ See proposed Rule 5.1(c).
\15\ See id.
\16\ See id.
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Under proposed Rule 5.1(c)(2), the Exchange may designate as
eligible for the proposed extended trading sessions during GTH up to
100 actively-traded, multi-listed equity option classes that meet the
following minimum criteria: (i) the option has an average daily volume
of 150,000 contracts, (ii) the equity security underlying the option
has a $50 billion market capitalization, and (iii) the equity security
underlying the option has an average daily trading volume of 10 million
shares.\17\ These minimum requirements may be waived if, during the
three days following an underlying security's initial public offering
day, the underlying security has a market capitalization of at least $3
billion based on the offering price of its initial public offering.\18\
In this case, options on the underlying security may be listed and
traded in the proposed extended sessions, without regard to the
criteria noted in (i)-(iii) above, starting on or after the second
business day following the initial public offering day.\19\ Any option
classes designated under this waiver would be included in the 100-class
limit.\20\
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\17\ See proposed Rule 5.1(c)(2).
\18\ See id.
\19\ See id.
\20\ See Notice, supra note 4, at 48092.
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In addition, proposed Rule 5.1(c)(2) would permit the Exchange to
designate as eligible for the proposed extended trading sessions during
GTH any equity option that is traded on another exchange during GTH or
any other trading session that is not RTH or Curb.\21\ Any options so
designated under this provision would not be included in the 100-class
limit.\22\ Moreover, if the Exchange designates a class of equity
options as eligible for the proposed extended trading sessions during
GTH, FLEX Options with the same underlying equity security would also
be deemed eligible for the proposed extended trading sessions during
GTH.\23\
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\21\ See proposed Rule 5.1(c)(2).
\22\ See id.; see also Notice, supra note 4, at 48092.
\23\ See proposed Rule 5.1(c)(2).
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The Exchange also proposes rule amendments to support the proposed
GTH trading for equity options. The Exchange proposes to amend Rule
5.1(e)
[[Page 61455]]
to specify that, unlike GTH for index options, GTH for equity options
will not occur on a holiday.\24\ The Exchange proposes to amend Rule
5.20 by adding new section (g) to state that the trading of equity
options in GTH would be subject to the same trading halt rules as
equity option trading in RTH.\25\ According to the Exchange, trading in
equity options in GTH would generally halt when the underlying security
of an option is halted, and trading halt provisions for GTH index
options would not be applicable to equity options.\26\ Further, the
Exchange proposes to amend the opening auction process in Rule 5.31 to
incorporate GTH for equity options.\27\ Rule 5.31(b) currently provides
that the queuing period for GTH for All Sessions Classes \28\ begins at
8:00 p.m., 15 minutes prior to the commencement of GTH. The Exchange
proposes to amend this rule to apply the existing queuing period
beginning at 8:00 p.m. to index options and establish a new queuing
period for equity options in GTH that would commence at 7:15 a.m.,
which would be 15 minutes prior to the commencement of the GTH
session.\29\ The Exchange further proposes to amend Rule 5.31(d) to
establish opening rotation triggers processing for GTH equity options
by duplicating the existing opening rotations triggers processing for
RTH equity options.\30\
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\24\ See Notice, supra note 4, at 48093.
\25\ See id.
\26\ See id.
\27\ See id.
\28\ See Rule 1.1 (defining the term ``All Sessions Class'' as
an options class that the Exchange lists for trading during all
trading sessions).
\29\ See proposed Rule 5.31(b).
\30\ See proposed Rule 5.31(d); see also Notice, supra note 4,
at 48093.
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III. Proceedings To Determine Whether To Approve or Disapprove the
Proposed Rule Change
The Commission hereby institutes proceedings pursuant to Section
19(b)(2)(B) of the Act \31\ to determine whether the Exchange's
proposed rule change should be approved or disapproved. Institution of
proceedings does not indicate that the Commission has reached any
conclusions with respect to any of the issues involved. Rather, the
Commission seeks and encourages interested persons to provide comment
on the proposed rule change to inform the Commission's analysis of
whether to approve or disapprove the proposed rule change.
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\31\ 15 U.S.C. 78s(b)(2)(B).
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Pursuant to Section 19(b)(2)(B) of the Act,\32\ the Commission is
providing notice of the grounds for disapproval under consideration.
The Commission is instituting proceedings to allow for additional
analysis of, and input from commenters with respect to, the consistency
of the proposed rule change with the Act; in particular, Section
6(b)(5) of the Act,\33\ which requires that the rules of a national
securities exchange be designed to promote just and equitable
principles of trade, 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, and not be designed to
permit unfair discrimination between customers, issuers, brokers, or
dealers; and Section 6(b)(8) \34\ of the Act, which prohibits the rules
of a national securities exchange from imposing any burden on
competition not necessary or appropriate in furtherance of the purposes
of the Act.
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\32\ Id.
\33\ 15 U.S.C. 78f(b)(5).
\34\ 15 U.S.C. 78f(b)(8).
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Under the Commission's Rules of Practice, the ``burden to
demonstrate that a proposed rule change is consistent with the [Act]
and the rules and regulations issued thereunder . . . is on the self-
regulatory organization that proposed the rule change.'' \35\ The
description of a proposed rule change, its purpose and operation, its
effect, and a legal analysis of its consistency with applicable
requirements must all be sufficiently detailed and specific to support
an affirmative Commission finding,\36\ and any failure of a self-
regulatory organization to provide this information may result in the
Commission not having a sufficient basis to make an affirmative finding
that a proposed rule change is consistent with the Act and the
applicable rules and regulations.\37\
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\35\ Rule 700(b)(3), Commission Rules of Practice, 17 CFR
201.700(b)(3).
\36\ Id.
\37\ Id.
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The Exchange's proposal is novel in that no national securities
exchange currently permits the trading of equity options during the
pre-RTH time period countenanced by the proposal or the trading of
equity options that are not options on ETFs, ETNs, Index Portfolio
Shares, Index Portfolio Receipts, or Trust Issued Receipts during the
post-RTH period countenanced by the proposal. The Commission is
concerned that the proposal does not provide an adequate basis for the
Commission to conclude, at this time, that these proposed extended
trading sessions would be consistent with the Act. The Commission asks
that commenters address the sufficiency of the Exchange's statements in
support of the proposal, which are set forth in the Notice, in addition
to any other comments they may wish to submit about the proposed rule
change. In particular, the Commission seeks comment on whether the
Exchange's proposed extended trading sessions for designated equity
options would be consistent with Sections 6(b)(5) and 6(b)(8) of the
Act.\38\
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\38\ See 15 U.S.C. 78f(b)(5) and (8).
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IV. Commission's Solicitation of Comments
The Commission requests written views, data, and arguments with
respect to the concerns identified above as well as any other relevant
concerns. Such comments should be submitted by January 21, 2026.
Rebuttal comments should be submitted by February 4, 2026. Although
there do not appear to be any issues relevant to approval or
disapproval that would be facilitated by an oral presentation of views,
data, and arguments, the Commission will consider, pursuant to Rule
19b-4, any request for an opportunity to make an oral presentation.\39\
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\39\ 15 U.S.C. 78s(b)(2). Section 19(b)(2) of the Act grants the
Commission flexibility to determine what type of proceeding--either
oral or notice and opportunity for written comments--is appropriate
for consideration of a particular proposal by an SRO. See Securities
Acts Amendments of 1975, Report of the Senate Committee on Banking,
Housing and Urban Affairs to Accompany S. 249, S. Rep. No. 75, 94th
Cong., 1st Sess. 30 (1975).
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The Commission asks that commenters address the sufficiency and
merit of the Exchange's statements in support of the proposal, in
addition to any other comments they may wish to submit about the
proposed rule change.
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#96e4e3faf3bbf5f9fbfbf3f8e2e5d6e5f3f5b8f1f9e0"><span class="__cf_email__" data-cfemail="f785829b92da94989a9a92998384b7849294d9909881">[email protected]</span></a>. Please include
file number SR-CBOE-2025-079 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-CBOE-2025-079. This file
number should be included on the
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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 filing 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-CBOE-2025-
079 and should be submitted on or before January 21, 2026. Rebuttal
comments should be submitted by February 4, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\40\
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\40\ 17 CFR 200.30-3(a)(57).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-24055 Filed 12-30-25; 8:45 am]
BILLING CODE 8011-01-P
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