[Federal Register Volume 89, Number 3 (Thursday, January 4, 2024)]
[Notices]
[Pages 490-495]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-28950]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-99252; File No. SR-MEMX-2023-37]


Self-Regulatory Organizations; MEMX LLC; Notice of Filing and 
Immediate Effectiveness of a Proposed Rule Change To Amend the 
Exchange's Rules To Accommodate the Listing of Options Series That 
Would Expire at the Close of Business on the Last Business Day of a 
Calendar Month (``Monthly Options Series'')

December 28, 2023.
    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 December 20, 2023, MEMX LLC (``MEMX'' or ``Exchange'') filed 
with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared by the Exchange. The Exchange filed the proposal as 
a ``non-controversial'' proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) thereunder.\4\ 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 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 is filing with the Commission a proposed rule change 
to amend its Rules to accommodate the listing of options series that 
would expire at the close of business on the last business day of a 
calendar month (``Monthly Options Series''). The text of the proposed 
rule change is provided in Exhibit 5.

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.

[[Page 491]]

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Rules to accommodate the listing 
of options series that would expire at the close of business on the 
last business day of a calendar month (``Monthly Options Series''). 
Pursuant to proposed Rules 19.5, Interpretation and Policy .08(a) and 
29.11(k)(1),\5\ the Exchange may list Monthly Options Series for up to 
five currently listed option classes that are either index options or 
options on exchange-traded funds (``ETFs'').\6\ In addition, the 
Exchange may also list Monthly Options Series on any options classes 
that are selected by other securities exchanges that employ a similar 
program under their respective rules.\7\ The Exchange may list 12 
expirations for Monthly Options Series. Monthly Options Series need not 
be for consecutive months; however, the expiration date of a 
nonconsecutive expiration may not be beyond what would be considered 
the last expiration date if the maximum number of expirations were 
listed consecutively.\8\ Other expirations in the same class are not 
counted as part of the maximum numbers of Monthly Options Series 
expirations for a class.\9\ Monthly Options Series will be P.M.-
settled.\10\
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    \5\ The proposed rule change defines the term ``Monthly Options 
series'' in Rule 29.2(k) (and re-letters current paragraphs (k) 
through (o) to be (l) through (p)) as a series in an options class 
that is approved for listing and trading on the Exchange in which 
the series is opened for trading on any business day and that 
expires at the close of business on the last business day of a 
calendar month.
    \6\ The Exchange proposes to amend Rule 19.5(a) and (b) to 
provide that proposed Rule 19.5, Interpretation and Policy .08 will 
describe how the Exchange will fix a specific expiration date and 
exercise price for Monthly Options Series and will govern the 
procedures for opening Monthly Options Series, respectively. The 
proposed change to Rule 19.5(a) is consistent with language in 
current Rule 19.5(a) for other Short Term Option Series and 
Quarterly Options Series. The proposed rule change also makes a non-
substantive correction to pluralize the term ``policy'' (to become 
``policies'') to be consistent with the terminology in the Rules. 
Additionally, the proposed rule change adds to Rule 19.5(b) that 
Interpretation and Policies .04 and .05 will govern the procedures 
for opening Quarterly Options Series and Short Term Option Series, 
respectively (as well as adding exception language to the beginning 
of that paragraph). This is merely a clarification, as Rule 19.5, 
Interpretations and Policies .04 and .05 clearly govern the opening 
procedures for those options listing programs. This proposed change 
is also consistent with Cboe Exchange, Inc. (``Cboe Options'') Rule 
4.5(b), which has similar options listing programs.
    \7\ The Securities and Exchange Commission (the ``Commission'') 
recently approved a Cboe Options proposed rule change to adopt a 
substantively identical Monthly Options Series program. See 
Securities Exchange Act Release No. 98915 (November 13, 2023) (SR-
CBOE-2023-049) (``Cboe Options Approval Order'').
    \8\ The Exchange notes this provision considers consecutive 
monthly listings. In other words, as other expirations (such as 
Quarterly Options Series) are not counted as part of the maximum, 
those expirations would not be considered when considering when the 
last expiration date would be if the maximum number were listed 
consecutively. For example, if it is January 2024 and the Exchange 
lists Quarterly Options Series in class ABC with expirations in 
March, June, September, December, and the following March, the 
Exchange could also list Monthly Options Series in class ABC with 
expirations in January, February, April, May, July, August, October, 
and November 2024 and January and February of 2025. This is because, 
if Quarterly Options Series, for example, were counted, the Exchange 
would otherwise never be able to list the maximum number of Monthly 
Options Series. This is consistent with the listing provisions for 
Quarterly Options Series, which permit calendar quarter expirations. 
The need to list series with the same expiration in the current 
calendar year and the following calendar year (whether Monthly or 
Quarterly expiration) is to allow market participants to execute 
one-year strategies pursuant to which they may roll their exposures 
in the longer-dated options (e.g., January 2025) prior to the 
expiration of the nearer-dated option (e.g., January 2024).
    \9\ See proposed Rules 19.5, Interpretation and Policy .08(b) 
and 29.11(k)(2).
    \10\ See proposed Rules 19.5, Interpretation and Policy .08(c) 
and 29.11(k)(3).
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    The strike price of each Monthly Options Series will be fixed at a 
price per share, with at least two, but no more than five, strike 
prices above and at least two, but no more than five, strike prices 
below the value of the underlying index or price of the underlying 
security at about the time that a Monthly Options Series is opened for 
trading on the Exchange. The Exchange will list strike prices for 
Monthly Options Series that are reasonably related to the current price 
of the underlying security or current index value of the underlying 
index to which such series relates at about the time such series of 
options is first opened for trading on the Exchange. The term 
``reasonably related to the current price of the underlying security or 
index value of the underlying index'' means that the exercise price is 
within 30% of the current underlying security price or index value.\11\ 
Additional Monthly Options Series of the same class may be open for 
trading on the Exchange when the Exchange deems it necessary to 
maintain an orderly market, to meet customer demand, or when the market 
price of the underlying security moves substantially from the initial 
exercise price or prices. To the extent that any additional strike 
prices are listed by the Exchange, such additional strike prices will 
be within 30% above or below the closing price of the underlying index 
or security on the preceding day. The Exchange may also open additional 
strike prices of Monthly Options Series that are more than 30% above or 
below the current price of the underlying security, provided that 
demonstrated customer interest exists for such series, as expressed by 
institutional, corporate, or individual customers or their brokers. 
Market-Makers trading for their own account will not be considered when 
determining customer interest under this provision. The opening of the 
new Monthly Options Series will not affect the series of options of the 
same class previously opened.\12\ The interval between strike prices on 
Monthly Options Series will be the same as the interval for strike 
prices for series in that same options class that expire in accordance 
with the normal monthly expiration cycle.\13\
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    \11\ See proposed Rules 19.5, Interpretation and Policy .08(d) 
and 29.11(k)(4). The Exchange notes these proposed provisions are 
consistent with the initial series provision for the Quarterly 
Options Series program in Rule 29.11(g)(3). While different than the 
initial strike listing provision for the Quarterly Options Series 
program in current Rule 19.5, Interpretation and Policy .04(b), the 
Exchange believes the proposed provision is appropriate, as it 
contemplates classes that may have strike intervals of $5 or 
greater. For consistency, the Exchange also proposes to amend Rule 
19.5, Interpretation and Policy .04(b) to incorporate the same 
provision for initial series.
    \12\ See proposed Rules 19.5, Interpretation and Policy .08(e) 
and 29.11(k)(5).
    \13\ See proposed Rules 19.5, Interpretation and Policy .08(f) 
and 29.11(k)(6); see also Rule 19.5(d), (f), (g) and Interpretations 
and Policies .01-.03 and .06 (permissible strike prices for ETF 
classes) and Rule 29.11(c) (permissible strike prices for index 
options).
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    By definition, Monthly Options Series can never expire in the same 
week as a standard expiration series (which expire on the third Friday 
of a month) in the same class expires. The same, however, is not the 
case with regards to Short Term Option Series \14\ or Quarterly Options 
Series. Therefore, to avoid any confusion in the marketplace, the 
Exchange proposes to amend Rules 19.5, Interpretation and Policy .05 
(introductory paragraph), (b), and (h) and 29.11(h) (introductory 
paragraph) and (2) to provide the Exchange will not list a Short Term 
Option Series in a class on a date on which a Monthly Options Series or 
Quarterly Options

[[Page 492]]

Series expires.\15\ Similarly, proposed Rules 19.5, Interpretation and 
Policy .08(b) and 29.11(k)(2) provide that no Monthly Options Series 
may expire on a date that coincides with an expiration date of a 
Quarterly Options Series in the same index or ETF class. In other 
words, the Exchange will not list a Short Term Option Series on an 
index or ETF if a Monthly Options Series on that index or ETF were to 
expire on the same date, nor will the Exchange list a Monthly Options 
Series on an ETF or index if a Quarterly Options Series on that index 
or ETF were to expire on the same date to prevent the listing of series 
with concurrent expirations.\16\
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    \14\ The proposed rule change clarifies in Rule 29.11(a)(3) that 
index options have expiration months and weeks, which expirations 
may occur in consecutive weeks as specified in Rule 29.11(h). This 
is merely a clarification, as Rule 29.11(h) currently permits weekly 
expirations. This language is consistent with Cboe Options Rule 
4.13(a)(2). Additionally, the proposed rule change adds to rule 
29.11(a)(3) that index options may expire more than 12 months out as 
specified elsewhere in the Rule. This is consistent with current 
Rule 29.11(b), which permits long term index options to expire 
between 12 and 180 months after issuance, as well as proposed Rule 
29.11(k)(2), as discussed above.
    \15\ The Exchange also proposes to make a non-substantive change 
to Rules 19.5, Interpretation and Policy .05 and 29.11(h) to change 
current references to ``monthly options series'' to ``standard 
expiration options series'' (i.e., series that expire on the third 
Friday of a month), to eliminate potential confusion. The current 
references to ``monthly options series'' are intended to refer to 
those series that expire on the third Friday of a month, which are 
generally referred to in the industry as standard expirations. The 
proposed rule change also adds a heading to Rule 19.5, 
Interpretation and Policy .05 for consistency with other 
Interpretations and Policies in that Rule.
    \16\ The Exchange notes this would not prevent the Exchange from 
listing a P.M.-settled Monthly Options Series on an index with the 
same expiration date as an A.M.-settled Short Term Option Series on 
the same index, both of which may expire on a Friday. In other 
words, the Exchange may list a P.M-settled Monthly Options Series on 
an index concurrent with an A.M.-settled Short Term Option Series on 
that index and both of which expire on a Friday. The Exchange 
believes this concurrent listing would provide investors with yet 
another hedging mechanism and is reasonable given these series would 
not be identical (unlike if they were both P.M-settled). This could 
not occur with respect to ETFs, as all Short Term Option Series on 
ETFs are P.M.-settled.
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    With respect to Monthly Options Series added pursuant to proposed 
Rules 19.5, Interpretation and Policy .08(a) through (f) and 
29.11(k)(1) through (6), the Exchange will, on a monthly basis, review 
series that are outside a range of five strikes above and five strikes 
below the current price of the underlying index or security, and delist 
series with no open interest in both the put and the call series having 
a: (i) strike higher than the highest strike price with open interest 
in the put and/or call series for a given expiration month; and (ii) 
strike lower than the lowest strike price with open interest in the put 
and/or call series for a given expiration month. Notwithstanding this 
delisting policy, customer requests to add strikes and/or maintain 
strikes in Monthly Options Series in series eligible for delisting will 
be granted. In connection with this delisting policy, if the Exchange 
identifies series for delisting, the Exchange will notify other options 
exchanges with similar delisting policies regarding eligible series for 
delisting and will work with such other exchanges to develop a uniform 
list of series to be delisted, so as to ensure uniform series delisting 
of multiply listed Monthly Options Series.\17\
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    \17\ See proposed Rules 19.5, Interpretation and Policy .08(g) 
and 22.11(k)(7).
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    The Exchange believes that Monthly Options Series will provide 
investors with another flexible and valuable tool to manage risk 
exposure, minimize capital outlays, and be more responsive to the 
timing of events affecting the securities that underlie option 
contracts. The Exchange believes limiting Monthly Options Series to 
five classes will ensure the addition of these new series will have a 
negligible impact on the Exchange's and the Options Price Reporting 
Authority's (``OPRA's'') quoting capacity. The Exchange represents it 
has the necessary systems capacity to support new options series that 
will result from the introduction of Monthly Options Series.
    The Exchange notes that Rules 18.7 and 29.5 through 29.7 regarding 
position limits will apply to Monthly Options Series. These Rules 
provide that the position limits fixed by MEMX Options \18\ and Cboe 
Options \19\ apply to options contracts traded on MEMX Options, which 
would include Monthly Options Series.\20\ As noted above, Cboe Options 
recently received Commission approval to adopt a substantively 
identical Monthly Options Series Program as the one proposed in this 
rule filing.\21\ Pursuant to those recently approved Cboe Options 
rules, Monthly Options Series will be aggregated with positions in 
options contracts on the same underlying security or index.\22\ This is 
consistent with how position (and exercise) limits are currently 
imposed on series with other expirations (Short Term Option Series and 
Quarterly Options Series). Therefore, positions in options within a 
class of index or ETF options, regardless of their expirations, would 
continue to be subject to existing position (and exercise) limits. The 
Exchange believes this will address potential manipulative schemes and 
adverse market impacts surrounding the use of options.
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    \18\ See MEMX Rule 18.7.
    \19\ See MEMX Rule 29.5.
    \20\ The Exchange issued Regulatory Notice 23-12 on September 
14, 2023 which clarified its specific position limits applicable to 
options on the Exchange are those calculated and disseminated by the 
Options Clearing Corporation (``OCC''). See: https://info.memxtrading.com/wp-content/uploads/2023/09/RegNotice-23-12-Options-Position-Limits.pdf.
    \21\ See Cboe Options Approval Order.
    \22\ See id.; see also Cboe Options Rules 8.30, Interpretation 
and Policy .09 (regarding position limits for options on stocks and 
ETFs), 8.31(e) (regarding position limits for broad-based index 
options), 8.32(f) (regarding position limits for industry index 
options), 8.33(c) (regarding position limits for micro and narrow-
based indexes), and 8.34(c) (regarding position limits for 
individual stock or ETF based volatility index options). Pursuant to 
Cboe Options Rule 8.42 (and Exchange Rules 18.9 and 29.9), exercise 
limits for impacted index and ETF classes would be equal to the 
applicable position limits.
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    The Exchange also represents its current surveillance programs will 
apply to Monthly Options Series and will properly monitor trading in 
the proposed Monthly Options Series. The Exchange currently lists 
Quarterly Options Series in certain ETF classes, which expire at the 
close of business at the end of four calendar months (i.e., the end of 
each calendar quarter), and has not experienced any market disruptions 
nor issues with capacity. The Exchange's surveillance programs 
currently in place to support and properly monitor trading in these 
Quarterly Options Series, as well as Short Term Option Series and 
standard expiration series, will apply to the proposed Monthly Options 
Series. The Exchange believes its surveillances continue to be designed 
to deter and detect violations of its Rules, including position and 
exercise limits and possible manipulative behavior, and these 
surveillances will apply to Monthly Options Series that the Exchange 
determines to list for trading. Ultimately, the Exchange does not 
believe the proposed rule change raises any unique regulatory concerns 
because existing safeguards--such as position and exercise limits (and 
the aggregation of options overlying the same index or ETF) and 
reporting requirements--would continue to apply.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the Securities Exchange Act of 1934 (the ``Act'') and the rules 
and regulations thereunder applicable to the Exchange and, in 
particular, the requirements of Section 6(b) of the Act.\23\ 
Specifically, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \24\ requirements that the rules of 
an exchange be designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, 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 of a free and

[[Page 493]]

open market and a national market system, and, in general, to protect 
investors and the public interest. Additionally, the Exchange believes 
the proposed rule change is consistent with the Section 6(b)(5) \25\ 
requirement that the rules of an exchange not be designed to permit 
unfair discrimination between customers, issuers, brokers, or dealers.
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    \23\ 15 U.S.C. 78f(b).
    \24\ 15 U.S.C. 78f(b)(5).
    \25\ Id.
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    In particular, the Exchange believes the introduction of Monthly 
Options Series will remove impediments to and perfect the mechanism of 
a free and open market and a national market system by expanding 
hedging tools available to market participants. The Exchange believes 
the proposed monthly expirations will allow market participants to 
transact in the index and ETF options listed pursuant to the proposed 
rule change based on their timing as needed and allow them to tailor 
their investment and hedging needs more effectively. Further, the 
Exchange believes the availability of Monthly Options Series would 
protect investors and the public interest by providing investors with 
more flexibility to closely tailor their investment and hedging 
decisions in these options, thus allowing them to better manage their 
risk exposure.
    The Exchange believes the Quarterly Options Series Program has been 
successful to date and the proposed Monthly Options Series program 
simply expands the ability of investors to hedge risk against market 
movements stemming from economic releases or market events that occur 
at months' ends in the same way the Quarterly Options Series Program 
has expanded the landscape of hedging for quarter-end news. Monthly 
Options Series will also complement Short Term Option Series, which 
allow investors to hedge risk against events that occur throughout a 
month. The Exchange believes the availability of additional expirations 
should create greater trading and hedging opportunities for investors, 
as well as provide investors with the ability to tailor their 
investment objectives more effectively.
    The Exchange notes the proposed terms of Monthly Options Series, 
including the limitation to five index and ETF option classes, are 
substantively the same as the current terms of Quarterly Options 
Series.\26\ Quarterly Options Series expire on the last business day of 
a calendar quarter, which is the last business day of every third 
month. The proposed Monthly Options Series would fill the gaps between 
Quarterly Options Series expirations by permitting series to expire on 
the last business day of every month, rather than every third month. 
The proposed Monthly Options Series may be listed in accordance with 
the same terms as Quarterly Options Series, including permissible 
strikes.\27\ As is the case with Quarterly Options Series, no Short 
Term Option Series may expire on the same day as a Monthly Options 
Series. Similarly, as proposed, no Monthly Options Series may expire on 
the same day as a Quarterly Options Series. The Exchange believes 
preventing listing series with concurrent expirations in a class will 
eliminate potential investor confusion and thus protect investors and 
the public interest. Given that Quarterly Options Series the Exchange 
currently lists are essentially Monthly Options Series that can expire 
at the end of only certain calendar months, the Exchange believes it is 
reasonable to list Monthly Options Series in accordance with the same 
terms, as it will promote just and equitable principles of trade. The 
Exchange believes limiting Monthly Options Series to five classes will 
ensure the addition of these new series will have a negligible impact 
on the Exchange's and OPRA's quoting capacity. The Exchange represents 
it has the necessary systems capacity to support new options series 
that will result from the introduction of Monthly Options Series.
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    \26\ Compare proposed Rules 19.5, Interpretation and Policy .08 
and 29.11(k) to Rules 19.5, Interpretation and Policy .04 and 
29.11(g), respectively.
    \27\ The Exchange notes the proposed maximum number of 
expirations is consistent with the maximum number of expirations 
permitted for end-of-month series in index classes. See Rule 
29.11(j)(2) (which references Rule 29.11(a)(3), which permits up to 
12 standard monthly expirations on the majority of index options 
currently listed on the Exchange).
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    The Exchange further believes the proposed rule change regarding 
the treatment of Monthly Options Series with respect to determining 
compliance with position and exercise limits is designed to prevent 
fraudulent and manipulative acts and practices and promote just and 
equitable principles of trade. Monthly Options Series will be 
aggregated with options overlying the same ETF or index for purposes of 
compliance with position (and exercise) limits, which is consistent 
with how position (and exercise) limits are currently imposed on series 
with other expirations (Short Term Option Series and Quarterly Options 
Series).\28\ Therefore, options positions within ETF or index option 
classes for which Monthly Options Series are listed, regardless of 
their expirations, would continue to be subject to existing position 
(and exercise) limits. The Exchange believes this will address 
potential manipulative schemes and adverse market impacts surrounding 
the use of options. The Exchange also represents its current 
surveillance programs will apply to Monthly Options Series and will 
properly monitor trading in the proposed Monthly Options Series. The 
Exchange currently trades Quarterly Options Series in certain ETF 
classes, which expire at the close of business at the end of four 
calendar months (i.e., the end of each calendar quarter), and has not 
experienced any market disruptions nor issues with capacity. The 
Exchange's surveillance programs currently in place to support and 
properly monitor trading in these Quarterly Options Series, as well as 
Short Term Option Series and standard expiration series, will apply to 
the proposed Monthly Options Series. The Exchange believes its 
surveillances continue to be designed to deter and detect violations of 
its Rules, including position and exercise limits and possible 
manipulative behavior, and these surveillances will apply to Monthly 
Options Series that the Exchange determines to list for trading. 
Ultimately, the Exchange does not believe the proposed rule change 
raises any unique regulatory concerns because existing safeguards--such 
as position and exercise limits (and the aggregation of options 
overlying the same ETF or index) and reporting requirements--would 
continue to apply.
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    \28\ See Cboe Options Approval Order; see also Cboe Options 
Rules 8.30, Interpretation and Policy .09 (regarding position limits 
for options on stocks and ETFs), 8.31(e) (regarding position limits 
for broad-based index options), 8.32(f) (regarding position limits 
for industry index options), 8.33(c) (regarding position limits for 
micro narrow-based indexes), and 8.34(c) (regarding position limits 
for individual stock or ETF based volatility index options). 
Pursuant to Cboe Options Rule 8.42 (and Exchange Rules 18.9 and 
29.9), exercise limits for impacted index and ETF classes would be 
equal to the applicable position limits.
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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 does not 
believe the proposed rule change to list Monthly Options Series will 
impose any burden on intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act, as any Monthly 
Options Series the Exchange lists for trading will be available in the 
same manner for all market participants

[[Page 494]]

who wish to trade such options. The Exchange notes the proposed terms 
of Monthly Options Series, including the limitation to five index and 
ETF option classes, are substantively the same as the current terms of 
Quarterly Options Series.\29\ Quarterly Options Series expire on the 
last business day of a calendar quarter, which is the last business day 
of every third month, making the concept of Monthly Options Series in a 
limited number of index and ETF options not novel. The proposed Monthly 
Options Series will fill the gaps between Quarterly Options Series 
expirations by permitting series to expire on the last business day of 
every month, rather than every third month. The proposed Monthly 
Options Series may be listed in accordance with the same terms as 
Quarterly Options Series, including permissible strikes.\30\ Monthly 
Options Series will trade on the Exchange in the same manner as other 
options in the same class.
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    \29\ See Rules 19.5, Interpretation and Policy .04 and 29.11(g).
    \30\ See supra note 27.
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    The Exchange does not believe the proposed rule change to list 
Monthly Options Series will impose any burden on intermarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act, as nothing prevents other options exchanges from 
proposing similar rules.\31\ As discussed above, the proposed rule 
change would permit listing of Monthly Options Series in five index or 
ETF options, as well as any other classes that other exchanges may list 
under similar programs. To the extent that the availability of Monthly 
Options Series makes the Exchange a more attractive marketplace to 
market participants at other exchanges, market participants are free to 
elect to become market participants on the Exchange.
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    \31\ As noted above, at least one other options exchange 
recently adopted a substantively identical Monthly Options Series 
program. See Cboe Options Approval Order.
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    The Exchange believes that the proposed rule change may relieve any 
burden on, or otherwise promote, competition. Similar to Short Term 
Option Series and Quarterly Options Series, the Exchange believes the 
introduction of Monthly Options Series will not impose an undue burden 
on competition. The Exchange believes that it will, among other things, 
expand hedging tools available to market participants. The Exchange 
believes Monthly Options Series will allow market participants to 
purchase options based on their timing as needed and allow them to 
tailor their investment and hedging needs more effectively.
    The Exchange does not believe the proposed rule change regarding 
aggregation of positions for purposes of determining compliance with 
position (and exercise) limits will impose any burden on intramarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act, because it will apply in the same manner to all 
market participants. The Exchange proposes to apply position (and 
exercise) limits to Monthly Options Series in the same manner it 
applies position limits to series with other expirations (Short Term 
Option Series and Quarterly Options Series). Therefore, positions in 
options in a class of ETF or index options, regardless of their 
expirations, would continue to be subject to existing position (and 
exercise) limits. Additionally, the Exchange does not believe this 
proposed rule change will impose any burden on intermarket competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act, because it will address potential manipulative schemes and 
adverse market impacts surrounding the use of options.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \32\ and Rule 19b-4(f)(6) thereunder.\33\ 
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 \34\ and subparagraph (f)(6) of 
Rule 19b-4 thereunder.\35\
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    \32\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \33\ 17 CFR 240.19b-4(f)(6).
    \34\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \35\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
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 pursuant to Rule 19b-4(f)(6) under the 
Act \36\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \37\ permits the 
Commission to designate a shorter time if such action is consistent 
with the protection of investors and the public interest. The Exchange 
has requested that the Commission waive the 30-day operative delay so 
that the Exchange may list Monthly Options Series immediately, which 
the Exchange believes will benefit investors by promoting competition 
in Monthly Options Series. The Exchange notes that its proposal is 
substantively identical to the proposal submitted by Cboe Exchange, 
Inc. for its Monthly Options Series program.\38\ The Commission 
believes that the proposed rule change presents no novel issues and 
that waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest. Accordingly, the 
Commission hereby waives the operative delay and designates the 
proposed rule change operative upon filing.\39\
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    \36\ 17 CFR 240.19b-4(f)(6).
    \37\ 17 CFR 240.19b-4(f)(6)(iii).
    \38\ See Cboe Monthly Approval Order, supra note 7.
    \39\ For purposes only of waiving the 30-day operative delay, 
the Commission has also 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

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-MEMX-2023-37 on the subject line.

[[Page 495]]

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-MEMX-2023-37. 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 (https://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 
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. 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-MEMX-2023-37 and should be 
submitted on or before January 25, 2023.
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    \40\ 17 CFR 200.30-3(a)(12), (59).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\40\
Christina Z. Milnor,
Assistant Secretary.
[FR Doc. 2023-28950 Filed 1-3-24; 8:45 am]
BILLING CODE 8011-01-P