[Federal Register Volume 75, Number 174 (Thursday, September 9, 2010)]
[Notices]
[Pages 54933-54935]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-22449]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62829; File No. SR-BX-2010-061]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Permit
Concurrent Listing of $2.50 and $1 Strikes on MNX Options
September 2, 2010.
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 August 30, 2010, NASDAQ OMX BX, Inc. (the ``Exchange'') filed
with the Securities and Exchange Commission (``SEC'' or ``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 Chapter XIV, Section 10 (Terms of
Index Options Contracts) of the Rules of the Boston Options Exchange
Group, LLC (``BOX'') to allow the Exchange to concurrently list $2.50
and $1 strikes on Mini- Nasdaq-100 Index (``MNX'') options, and that
certain listing parameters only apply to $1 strikes on MNX options. The
text of the proposed rule change is available from the principal office
of the Exchange, on the Commission's Web site at http://www.sec.gov, at
the Commission's Public Reference Room and also on the Exchange's
Internet Web site at http://nasdaqomxbx.cchwallstreet.com/NASDAQOMXBX/Filings/.
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.
[[Page 54934]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of the proposed rule change is to allow BOX to
concurrently list $2.50 and $1 strikes on MNX options, and that certain
listing parameters only apply to $1 strikes on MNX options. BOX
believes that the availability of $2.50 and $1 strike price intervals
in MNX option series will provide investors with greater flexibility by
allowing them to establish positions that are better tailored to meet
their investment objectives.
Since December 2008, BOX has had the ability to list $1 strikes on
MNX options.\3\ In connection with the proposal to permit $1 strikes
for MNX options, BOX established parameters subject to which $1 strikes
may be added and delisted. For example, the number of initial series
that BOX may add is limited to 11 series.\4\ Also, the total number of
additional series that may be added for $1 strikes is sixty (60) per
expiration month for each series in MNX options.\5\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 59129 (Dec. 22,
2008), 73 FR 79945 (Dec. 30, 2008) (SR-BSE-2008-57) (rule change
permitting $1 strikes for MNX options).
\4\ See Chapter XIV, Section 10(c)(5)(i) of the BOX Rules.
\5\ See Chapter XIV, Section 10(c)(5)(ii) of the BOX Rules.
---------------------------------------------------------------------------
Similar parameters do not exist with regard to the listing of $2.50
strikes, and BOX now seeks to clarify that the parameters adopted with
the proposal to permit $1 strikes for MNX options do not apply to the
listing of $2.50 strikes for MNX options.\6\ In addition, BOX is
proposing to codify a bracketing provision that prohibits the Exchange
from listing strike prices with $1 intervals within $0.50 of an
existing strike price in the same series. This bracketing provision is
identical to an existing provision in effect for the $1 Strike Program,
which permits the concurrent listing of $2.50 and $1 strikes.\7\
---------------------------------------------------------------------------
\6\ See Chapter XIV, Section 10(c)(1) of the BOX Rules.
\7\ See Supplementary Material .02(c) to Chapter IV, Section 6
of the BOX Rules.
---------------------------------------------------------------------------
Finally, the Exchange proposes to change Section 10(c)(5)(iii)
providing that BOX shall not list LEAPS on Mini-NDX options at
intervals less than $5.00 to provide that BOX shall not list LEAPS on
Mini-NDX options at intervals less than $2.50.
BOX has analyzed its capacity and represents that it believes the
Exchange and the Options Price Reporting Authority have the necessary
systems capacity to handle the additional traffic associated with the
concurrent listing and trading of $1 and $2.50 strikes for MNX options.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act,\8\ in general, and Section
6(b)(5) of the Act,\9\ in particular, in that it is designed 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 for a free and open market and a national market
system and, in general, to protect investors and the public interest.
In particular, the Exchange believes that allowing the concurrent
listing and trading of $1 and $2.50 strikes for MNX options will result
in a continuing benefit to investors by giving them more flexibility to
closely tailor their investment decisions in a greater number of
securities.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
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.
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
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not 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 \10\ and Rule 19b-
4(f)(6) thereunder.\11\
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the self-regulatory organization to submit to 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 Commission has waived the five-day pre-filing
requirement in this case.
---------------------------------------------------------------------------
The Exchange has requested that the Commission waive the 30-day
operative delay. The Commission believes that waiver of the operative
delay is consistent with the protection of investors and the public
interest because the proposal is substantially similar to a rule of
another exchange.\12\ Therefore, the Commission designates the proposal
operative upon filing.\13\
---------------------------------------------------------------------------
\12\ See CBOE Rules 5.5 and 24.9 and Interpretations and
Policies .01 (j) to Rule 24.9. See also Securities Exchange Act
Release No. 34-61270 (Dec. 31, 2009), 75 FR 1444 (Jan. 11, 2010)
(SR-CBOE-2009-099).
\13\ 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).
---------------------------------------------------------------------------
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.
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
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-BX-2010-061 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-BX-2010-061. This file
number should be included on the subject line if e-mail 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent
[[Page 54935]]
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 Web site 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. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-BX-2010-061 and should be submitted on or before
September 30, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
---------------------------------------------------------------------------
\14\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-22449 Filed 9-8-10; 8:45 am]
BILLING CODE 8010-01-P