[Federal Register Volume 67, Number 76 (Friday, April 19, 2002)]
[Notices]
[Page 19464]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-9630]



[[Page 19464]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45731; File No. SR-CBOE-2001-62]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by the Chicago Board Options Exchange, Inc. Relating to Minimum 
Trading Increments for Spread, Straddle, and Combination Orders in 
Options on the S&P 500 Index

April 11, 2002.
    On December 13, 2001, the Chicago Board Options Exchange, Inc. 
(``CBOE or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission''), pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to amend CBOE Rule 6.42, Minimum 
Increments for Bids and Offers, to require that bids and offers on 
spread, straddle, or combination orders in options on the S&P 500 Index 
(``SPX''), except for box spreads, be expressed in decimal increments 
no smaller than $0.05. In addition, the proposed rule change adds new 
interpretation .05 to CBOE to define the term ``box spreads.'' The 
proposed rule change was published for comment in the Federal Register 
on March 5, 2002.\3\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 45479 (February 26, 
2002), 67 FR 10026.
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    The Commission finds that the proposed rule change in consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange \4\ and, in 
particular, the requirements of Section 6 of the Act \5\ and the rules 
and regulations thereunder. The Commission believes that the proposed 
rule change is consistent with Section 6(b)(5) of the Act,\6\ which, 
among other things, requires that the Exchange's rules be designed to 
promote just and equitable principles of trade and facilitate 
transactions in securities. The commission believes that requiring bids 
and offers, in spread, straddle, and combination orders in SPX options 
to be expressed in decimal increments no smaller that $0.05 should 
increase the ability of SPX options traders to execute these types of 
orders efficiently by reducing the number of steps necessary to break 
the orders down into the required contract quantities and prices.
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    \4\ In approving this proposed rule change, the Commission notes 
that it has considered its impact on efficiency, competition, and 
capital formation. 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\7\ that the proposed rule change (SR-CBOE-2001-62) is approved.
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    \7\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-9630 Filed 4-18-02; 8:45 am]
BILLING CODE 8010-01-M