Notice2026-03450
Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by Miami International Securities Exchange, LLC To Amend Exchange Rule 308
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
February 23, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 35 (Monday, February 23, 2026)</title>
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[Federal Register Volume 91, Number 35 (Monday, February 23, 2026)]
[Notices]
[Pages 8558-8560]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-03450]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104864; File No. SR-MIAX-2026-09]
Self-Regulatory Organizations; Miami International Securities
Exchange, LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change by Miami International Securities Exchange, LLC To
Amend Exchange Rule 308
February 18, 2026.
Pursuant to the provisions of Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on February 11, 2026, Miami International
Securities Exchange, LLC (``MIAX'' or ``Exchange'') filed with the
Securities and Exchange Commission (``Commission'') a 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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Exchange Rule 308, Exemptions from
Position Limits, to move the ``box spread'' \3\ qualified hedge
transaction to the category of qualified hedge transactions that are
exempt from established position limits as prescribed under Exchange
Rule 307(d). The text of the proposed rule change is available on the
Exchange's website at <a href="https://www.miaxglobal.com/markets/us-options/all-options-exchanges/rule-filings">https://www.miaxglobal.com/markets/us-options/all-options-exchanges/rule-filings</a> and at MIAX's principal office.
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\3\ The term ``box spread'' refers to a transaction involving a
long call position accompanied by a short put position with the same
strike price and a short call position accompanied by a long put
position with a different strike price. See Exchange Rule 308(a)(6).
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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 Exchange 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 Exchange 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
Exchange Rule 307 currently establishes position limits for
Members.\4\ Exchange Rule 308(a) provides several types of equity
hedges that the Exchange codified in its rules that are qualified
hedging transactions that are exempt from the position limits provided
for in Exchange Rule 307(d). One such qualified hedging transaction is
the box spread, which is subject to a position limit equal to five (5)
times the standard limit established under Exchange Rule 307(d). All
other qualified hedging transactions, other than as provided for in
Exchange Rule 308(a)(8),\5\ are not subject to the five times position
limit rule, but are exempt from established position limits as
prescribed under Exchange Rule 307(d).
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\4\ In general, Members may not enter into opening transactions
if the Member has reason to believe that as a result of such
transaction the Member or its customer would, acting alone or in
concert with others, directly or indirectly control an aggregate
position in an option contract traded on the Exchange in excess of
25,000 or 50,000 or 75,000 or 200,000 or 250,000 option contracts
(whether long or short) of the put type and the call type on the
same side of the market respecting the same underlying security,
combining for purposes of this position limit long positions in put
options with short positions in call options, and short positions in
put options with long positions in call options, or such other
number of option contracts as may be fixed from time to time by the
Exchange as the position limit for one or more classes or series of
options; or (2) exceed the applicable position limit fixed from time
to time by another exchange for an option contract not traded on the
Exchange, when the Member is not a member of the other exchange on
which the transaction was effected. See Exchange Rule 307.
\5\ Exchange Rule 308(a)(8) provides the equity hedge exemption
for a listed option position hedged on a one-for-one basis with an
over-the-counter (``OTC'') option position on the same underlying
security. The strike price of the listed option position and
corresponding OTC option position must be within one strike of each
other and no more than one expiration month apart.
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The Exchange now proposes to amend Exchange Rule 308(a) to move the
box spread qualified hedging transaction to the category of equity
hedges that are exempt from established position limits as prescribed
under Exchange Rule 307(d). The Exchange's equity hedge exemption rule
is based on the substantively similar rules in place at other options
exchanges and the Financial Industry Regulatory Authority, Inc.
(``FINRA''), all of which classify the box spread as a qualified
hedging transaction that is exempt from the established position limits
for each of those exchanges and FINRA.\6\
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\6\ See NYSE American LLC Rulebook, Rule 904, Commentary .09;
NYSE Arca Inc. Rulebook, Rule 6.8-O, Commentary .07; and FINRA Rule
2360(b)(3)(A)(ii). Nasdaq ISE, LLC and Nasdaq PHLX, LLC recently
filed to amend their respective rules to fix prior rule filings that
inadvertently classified the box spread in the category of equity
hedge exemptions that are limited to five times position limits
instead of the fully exempt category. See SR-ISE-2026-03 and SR-
Phlx-2026-04 (not yet noticed by the Commission). Both of those
filings cite to a 2002 rule filing by the Philadelphia Stock
Exchange, Inc., which eliminated position limits for certain
qualified hedging transactions, including box spreads. See
Securities Exchange Act Release No. 45889 (May 9, 2002), 67 FR 34980
(May 16, 2002) (SR-Phlx-2002-33).
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The Exchange notes that Exchange Rule 308 as proposed to be amended
by this filing, is incorporated by reference
[[Page 8559]]
into the rulebooks of MIAX PEARL, LLC (``MIAX Pearl''), MIAX Emerald,
LLC (``MIAX Emerald''), and MIAX Sapphire, LLC (``MIAX Sapphire''),
and, therefore, is a MIAX Pearl, MIAX Emerald and MIAX Sapphire rule
applicable to MIAX Pearl, MIAX Emerald, and MIAX Sapphire members.\7\
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\7\ See MIAX Pearl Options Exchange Rulebook, Chapter III; MIAX
Emerald Options Exchange Rulebook, Chapter III; and MIAX Sapphire
Options Exchange Rulebook, Chapter III.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\8\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\9\ in particular, in that it is 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.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
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The Exchange believes its proposal to amend Exchange Rule 308(a) to
move the box spread qualified hedging transaction to the category of
equity hedges that are exempt from established position limits promotes
just and equitable principles of trade by providing the same position
limit exemption for certain qualified hedging transactions on the
Exchange as offered by competing exchanges and FINRA.\10\ As described
above, NYSE Arca, NYSE American, and FINRA apply the five times
position limit standard only to OTC options contracts and both
exchanges exempt box spreads from their position limit rules. At this
time, the Exchange has been applying a stricter position limit
standard. With the proposed change, Members would not have a position
limit for a box spread and, therefore, would not have to unwind any
position as a result of this amendment.
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\10\ See supra note 6.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange believes its
proposal to amend Exchange Rule 308(a) to move the box spread qualified
hedging transaction to the category of equity hedges that are exempt
from established position limits does not impose an undue burden on
intra-market competition because all Members that transact box spreads
would be exempt from the position limits in Exchange Rule 307(d) on an
equal basis. The Exchange believes its proposal does not impose an
undue burden on inter-market competition as other options exchanges
have similar position limit rules that exempt box spreads from position
limits.\11\
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\11\ See supra note 6.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
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 after the date of the filing, or such
shorter time as the Commission may designate, it has become effective
pursuant to Section 19(b)(3)(A)(iii) of the Act \12\ and subparagraph
(f)(6) of Rule 19b-4 thereunder.\13\
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\12\ 15 U.S.C. 78s(b)(3)(A)(iii).
\13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
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 under Rule 19b-4(f)(6) \14\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange requests
that the Commission waive the 30-day operative delay so that the
proposed rule change may become operative immediately upon filing. The
Exchange states that the proposed rule change would align the
Exchange's rule with NYSE American, NYSE Arca, and FINRA rules
regarding exemptions from position limits.\16\ For this reason, and
because the proposal raises no new or novel legal or regulatory issues,
the Commission finds that waiver of the 30-day operative delay is
consistent with the protection of investors and the public interest.
Accordingly, the Commission waives the 30-day operative delay and
designates the proposed rule change to be operative upon filing.\17\
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\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6)(iii).
\16\ See supra note 6.
\17\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. 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="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#e99b9c858cc48a8684848c879d9aa99a8c8ac78e869f"><span class="__cf_email__" data-cfemail="85f7f0e9e0a8e6eae8e8e0ebf1f6c5f6e0e6abe2eaf3">[email protected]</span></a>. Please include
File Number SR-MIAX-2026-09 on the subject line.
Paper comments
<bullet> Send paper comments in triplicate to Vanessa Countryman,
Secretary, Securities and Exchange Commission, 100 F Street NE,
Washington, DC 20549-1090.
All submissions should refer to file number SR-MIAX-2026-09. 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 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-MIAX-2026-09 and should be submitted on
or before March 16, 2026.
[[Page 8560]]
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12) and (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-03450 Filed 2-20-26; 8:45 am]
BILLING CODE 8011-01-P
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</html>Indexed from Federal Register on February 23, 2026.
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