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###### Securities and Exchange Commission

          - [Release No. 34-64243; File No. SR-CBOE-2011-038]

                    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 April 6, 2011, the Chicago Board Options Exchange, Incorporated (“Exchange” or “CBOE”) 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.                

## I. Self-Regulatory Organization's Statement of the Terms of the Substance of the Proposed Rule Change

                    CBOE proposes to amend Rule 24.9 to change the close of trading hours from 3:15 p.m. (Chicago time) to 3 p.m. (Chicago time) on the last day of trading in expiring End-of-Week and End-of Month Expirations. The text of the rule proposal is available on the Exchange's Web site (                    *http://www.cboe.org/​legal*), at the Exchange's Office of the Secretary and at the Commission's Public Reference Room.                          ( print page 20772)    

## 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

                    The Exchange proposes to amend Rule 24.9 to change the close of trading hours from 3:15 p.m. (Chicago time) to 3 p.m. (Chicago time) on the last day of trading in expiring End-of-Week Expirations and End-of-Month Expirations. On September 14, 2010, the Securities and Exchange Commission (“Commission”) approved the implementation of a pilot program that permits P.M.-settled options on broad-based indexes to expire on (a) any Friday of the month, other than the third Friday-of-the-month (“End-of-Week Expirations” or “EOWs”) and (b) the last trading day of the month (“End-of-Month Expirations” or “EOMs”).[5] 

                    EOWs and EOMs are treated the same as traditional options on the same underlying index that expire on the Saturday following the third Friday of the month; provided, however, that EOWs and EOMs are P.M.-settled.[6]                                          EOWs and EOMs are subject to the same rules that currently govern the trading of traditional index options, including sales practice rules, margin requirements, and floor trading procedures. Contract terms for EOWs and EOMs are similar to regular index options, with one general exception: The exercise settlement value is based on the index value derived from the closing prices of component stocks.[7] 

Generally, EOWs and EOMs are priced in the market based on corresponding futures values. On the last day of trading, the closing prices of the component stocks (which are used to derive the exercise settlement value) are known at 3 p.m. (Chicago time) (or soon after) when the equity markets close. Despite the fact that the exercise settlement value is fixed at or soon after 3 p.m. (Chicago time), trading in expiring EOWs and EOMs continues, however, for an additional fifteen minutes until 3:15 p.m. (Chicago time) and are not priced on corresponding futures values, but rather the known cash value. At the same time, the prices of non-expiring EOW and EOM series continue to move and be priced in response to changes in corresponding futures prices.

                    Because of the potential pricing divergence that could occur between 3:00 and 3:15 pm on the final trading day in expiring EOWs and EOMs (                    *e.g.,*                     switch from pricing off of futures to cash), the Exchange believes that, in order to mitigate potential investor confusion, it is appropriate to cease trading in expiring EOWs and EOMs at 3 p.m. on the last day of trading. The proposed change to the close of trading hours will apply to all outstanding expiring EOW and EOM Expirations listed on or before the effective date of this proposal and to all EOWs and EOMs listed thereafter under the EOW/EOM Pilot Program.                

#### 2. Statutory Basis

                    The Exchange believes the proposed rule change is consistent with the Act [8]                                          and the rules and regulations thereunder and, in particular, the requirements of Section 6(b) of the Act.[9]                                          Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) [10]                                          requirements that the rules of an exchange be designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts, to remove impediments to and to perfect the mechanism for a free and open market and a national market system, and, in general, to protect investors and the public interest. Preventing continued trading on a product after the exercise settlement value has been fixed eliminates potential confusion and thereby protects investors and the public interest.                

### B. Self-Regulatory Organization's Statement on Burden on Competition

CBOE 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

No written comments were solicited or received with respect to the proposed rule change.

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

                    Because the foregoing proposed rule 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 if consistent with the protection of investors and the public interest, provided that the self-regulatory organization has given 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,[11]                                          the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act [12]                                          and Rule 19b-4(f)(6) thereunder.[13] 

At any time within 60 days of the filing of such 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 rule-comments@sec.gov.                      Please include File No. SR-CBOE-2011-038 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       ( print page 20773)                          20549-1090. All submissions should refer to File No. SR-CBOE-2011-038. 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 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 such filing also will be available for inspection and copying at the principal office of the CBOE. 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 No. SR-CBOE-2011-038 and should be submitted on or before May 4, 2011.                

                        For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.[14] 

Cathy H. Ahn,

Deputy Secretary. 

# Footnotes

1.                             15 U.S.C. 78s(b)(1).                    
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2.                             17 CFR 240.19b-4.                    
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3.                             15 U.S.C. 78s(b)(3)(A)(iii).                    
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4.                             17 CFR 240.19b-4(f)(6).                    
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5.                                                     *See*                         Securities Exchange Act Release No. 34-62911 (September 14, 2010), 75 FR 57539 (September 21, 2010) (SR-CBOE-2009-075).                    
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6.                                                     *See*                         CBOE Rule 24.9(e).                    
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7.                                                     *See*                         supra note 5.                    
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8.                             15 U.S.C. 78s(b)(1).                    
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9.                             15 U.S.C. 78f(b).                    
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10.                             15 U.S.C. 78f(b)(5).                    
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11.                             The Exchange has satisfied this requirement.                    
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12.                             15 U.S.C. 78s(b)(3)(A).                    
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13.                             17 CFR 240.19b-4(f)(6).                    
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14.                                 17 CFR 200.30-3(a)(12).                        
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[FR Doc. 2011-8804 Filed 4-12-11; 8:45 am]

BILLING CODE 8011-01-P