[Federal Register Volume 83, Number 234 (Thursday, December 6, 2018)]
[Notices]
[Pages 62942-62943]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-26396]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-84685; File No. SR-Phlx-2018-76]
Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend the Pilot
Period for the Listing of P.M.-Settled Nasdaq-100 Index Options
Expiring on the Third Friday of the Month
November 29, 2018.
Pursuant to 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 November 20, 2018, Nasdaq PHLX LLC (``Exchange'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I, II, and III 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 the pilot period for the listing of
P.M.-settled Nasdaq-100 Index Options expiring on the third Friday of
the month (``NDXPM options'').
The text of the proposed rule change is available on the Exchange's
website at http://nasdaqphlx.cchwallstreet.com/, 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 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
In August 2017 the Commission approved a proposed rule change for
the listing on the Exchange of NDXPM options on a pilot basis, with the
pilot to terminate on the earlier to occur of (i) 12 months following
the date of the first listing of the NDXPM options, or (ii) December
29, 2018.\3\ Notwithstanding this approval, due to unforeseen technical
programming delays P.M.-settled options on the NASDAQ-100 Index
(``NASDAQ-100'') have not yet been listed by the Exchange. In order to
allow sufficient time to realize the benefits of a pilot program for
NDXPM options, the Exchange proposes to amend Rule 1101A, Commentary
.05 such that he pilot will terminate on May 6, 2019. By extending the
outer limit of the pilot period, the Exchange believes it will have
adequate time to resolve the programming issues, implement the listing
of NDXPM options, and provide the pilot reports associated with the
initial approval order over a meaningful period of time. Without the
amendment, the pilot period would end on December 29, 2018 and would
not afford the Exchange or Commission a sufficient period of time
within which NDXPM options may trade in order to be meaningfully
evaluated by the Exchange as provided in the August 2017
[[Page 62943]]
approval order.\4\ The Exchange will make public on its website any
data and analysis it submits to the Commission under the pilot program.
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\3\ See Rule 1101A Commentary .05 and Securities Exchange Act
Release No. 81293 (August 2, 2017), 82 FR 37138 (August 8, 2017)
(approving SR-Phlx-2017-04).
\4\ The Exchange will issue an Options Trader Alert notifying
Members when NDXPM options are listed.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\5\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\6\ 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.
The Exchange believes the proposed rule change will protect investors
and the public interest by preserving the opportunity to list NDXPM
options until May 6, 2019, providing the Exchange, the Commission and
investors the benefit of a pilot program of sufficient duration to
yield meaningful information concerning the impact of NDXPM options on
the market.
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
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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 not necessary or appropriate in
furtherance of the purposes of the Act. NDXPM options would be
available for trading to all market participants. The proposed rule
change will facilitate the listing and trading of a novel option
product that will enhance competition among market participants, to the
benefit of investors and the marketplace. The listing of NDXPM will
enhance competition by providing investors with an additional
investment vehicle, in a fully-electronic trading environment, through
which investors can gain and hedge exposure to NASDAQ-100 stocks.
Further, this product could offer a competitive alternative to other
existing investment products that seek to allow investors to gain broad
market exposure. Also, the Exchange notes that it is possible for other
exchanges to develop or license the use of a new or different index to
compete with the NASDAQ-100 and seek Commission approval to list and
trade options on such an index.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or 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 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)(iii) of the Act \7\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\8\
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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\8\ 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 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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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
Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-Phlx-2018-76 on the subject line.
Paper Comments
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-Phlx-2018-76. 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 (http://www.sec.gov/rules/sro.shtml).
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 10:00 a.m. and
3:00 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-Phlx-2018-76 and should be submitted on
or before December 26, 2018.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12) and (59).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-26396 Filed 12-4-18; 8:45 am]
BILLING CODE 8011-01-P