Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 51111 

17 17 CFR 200.30–3(a)(12). 

1 15 U.S.C.78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4For purposes of this filing, the term 

‘‘Exchanges’’ refers collectively to BATS Exchange, 

Inc., BATS Y–Exchange, Inc., NASDAQ OMX BX, 

Inc., Chicago Board Options Exchange, Inc., 

Chicago Stock Exchange, Inc., EDGA Exchange, 

Inc., EDGX Exchange, Inc., International Securities 

Exchange LLC, The NASDAQ Stock Market LLC, 

New York Stock Exchange LLC, NYSE Amex LLC, 

NYSE Arca, Inc., National Stock Exchange, Inc., and 

NASDAQ OMX PHLX LLC. 

5See NYSE Amex Equities Rule 80C. The pauses 

under NYSE Amex Equities Rule 80C occur when 

a security’s price moves by the applicable 

percentage within a five minute period between 

9:45 a.m. and 3:35 p.m., or in the case of an early 

scheduled close, 25 minutes before the close of 

trading. Such pauses last for five minutes. At the 

conclusion of the pause period, the security is 

opened pursuant to NYSE Amex Equities Rule 

80C(b). 

6See Securities Exchange Act Release Nos. 62252 

(June 10, 2010), 75 FR 34186 (June 16, 2010) (File 

Nos. SR–BATS–2010–014; SR–EDGA–2010–01; SR– 

EDGX–2010–01; SR–BX–2010–037; SR–ISE–2010– 

48; SR–NYSE–2010–39; SR–NYSEAmex–2010–46; 

SR–NYSEArca–2010–41; SR–NASDAQ– 2010–061; 

SR–CHX–2010–10; SR–NSX–2010–05; and SR– 

CBOE–2010–047) and 62251 (June 10, 2010), 75 FR 

34183 (June 16, 2010) (SR–FINRA–2010–025). 

7See, e.g., Securities Exchange Act Release Nos. 

62884 (September 10, 2010), 75 FR 56618 

(September 16, 2010) (File Nos. SR–BATS–2010– 

018; SR–BX–2010–044; SR–CBOE–2010–065; SR– 

CHX–2010–14; SR–EDGA–2010–05; SR–EDGX– 

Continued 

All submissions should refer to File 

Number SR–BX–2011–056. 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 BX. 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 publicly available. All 

submissions should refer to File 

Number SR–BX–2011–056 and should 

be submitted on or before September 7, 

2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20906 Filed 8–16–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65102; File No. SR–NYSE 

Amex–2011–60] 

Self-Regulatory Organizations; NYSE 

Amex LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Amending NYSE Amex 

Equities Rule 128 so That Clearly 

Erroneous Executions Involving 

Securities Recently Added to the 

Individual Security Trading Pause Pilot 

Under NYSE Amex Equities Rule 80C 

Continue To Be Resolved in the Same 

Manner Before Being Added to the 

Pilot 

August 11, 2011. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that on August 9, 

2011, NYSE Amex LLC (the ‘‘Exchange’’ 

or ‘‘NYSE Amex’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II, 

below, which Items have been prepared 

by the self-regulatory organization. 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 Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

NYSE Amex Equities Rule 128 so that 

clearly erroneous executions involving 

securities recently added to the 

individual security trading pause pilot 

under NYSE Amex Equities Rule 80C 

continue to be resolved in the same 

manner as they were before being added 

to the pilot. The text of the proposed 

rule change is available at the Exchange, 

the Commission’s Public Reference 

Room, and http://www.nyse.com. 

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 those 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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

NYSE Amex Equities Rule 128 so that 

clearly erroneous executions involving 

securities recently added to the 

individual security trading pause pilot 

under NYSE Amex Equities Rule 80C 

continue to be resolved in the same 

manner as they were before being added 

to the pilot. 

Background 

The Exchanges 4 and the Financial 

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’), in consultation with the 

Commission, have made changes to 

their respective rules in a concerted 

effort to strengthen the markets after the 

severe market disruption that occurred 

on May 6, 2010. One such effort by the 

Exchanges and FINRA was to adopt a 

uniform trading pause process during 

periods of extraordinary market 

volatility as a pilot in S&P 500 Index 

stocks (‘‘Pause Pilot’’),5 approved by the 

Commission on June 10, 2010.6 On 

September 10, 2010, the Commission 

approved the Exchanges’ and FINRA’s 

proposals to add the securities included 

in the Russell 1000 Index and specified 

Exchange-Traded Products (‘‘ETPs’’) to 

the Pause Pilot.7 On September 10, 


Emcdonald on DSK2BSOYB1PROD with NOTICES
51112 Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 

2010–05; SR–ISE–2010–66; SR–NASDAQ–2010– 

079; SR–NYSE–2010–49; SR–NYSEAmex–2010–63; 

SR–NYSEArca–2010–61; and SR–NSX–2010–08) 

and 62883 (September 10, 2010), 75 FR 56608 

(September 16, 2010) (SR–FINRA–2010–033). 

8See Securities Exchange Act Release No. 62886 

(September 10, 2010), 75 FR 56613 (September 16, 

2010) (File Nos. SR–BATS–2010–016; SR–BX– 

2010–040; SR–CBOE–2010–056; SR–CHX–2010–13; 

SR–EDGA–2010–03; SR–EDGX–2010–03; SR–ISE– 

2010–62; SR–NASDAQ–2010–076; SR–NSX–2010– 

07; SR–NYSE–2010–47; SR–NYSEAmex–2010–60; 

and SR–NYSEArca–2010–58). 

9Pursuant to NYSE Amex Equities Rule 128(c)(1), 

during regular trading hours a security with a 

Reference Price of greater than zero and up to an 

including $25 is subject to a 10% threshold; a 

security with a Reference Price of greater than $25 

and up to and including $50 is subject to a 5% 

threshold; and a security with a Reference Price of 

greater than $50 is subject to a 3% threshold. 

10See NYSE Amex Equities Rule 128(c)(4). 

11See Securities Exchange Act Release No. 64735 

(June 23, 2011), 76 FR 38243 (June 29, 2011) (File 

Nos. SR–BATS–2011–016; SR–BYX–2011–011; SR– 

BX–2011–025; SR–CBOE–2011–049; SR–CHX– 

2011–09; SR–EDGA–2011–15; SR–EDGX–2011–14; 

SR–FINRA–2011–023; SR–ISE–2011–028; SR– 

NASDAQ–2011–067; SR–NYSE–2011–21; SR– 

NYSEAmex–2011–32; SR–NYSEArca–2011–26; SR– 

NSX–2011–06; and SR–Phlx–2011–64). 

12See NYSEAmex–2011–57 (extending NYSE 

Amex Equities Rule 80C pilot until January 31, 

2012) and NYSEAmex–2011–58 (extending NYSE 

Amex Equities Rule 128 pilot until January 31, 

2012). 13See supra note 9. 

2010, the Commission also approved 

changes proposed by the Exchanges to 

amend certain of their respective rules 

to set forth clearer standards and curtail 

their discretion with respect to breaking 

erroneous trades.8 The changes, among 

other things, provided for uniform 

treatment of clearly erroneous execution 

reviews in the event of transactions that 

result in the issuance of an individual 

stock trading pause pursuant to the 

Pause Pilot on the primary listing 

market and those transactions that occur 

up to the time the trading pause 

message is received by the other markets 

from the single plan processor 

responsible for consolidation and 

dissemination of information for the 

security (‘‘Latency Trades’’). 

As part of the changes to the clearly 

erroneous process under NYSE Amex 

Equities Rule 128, the Exchange added 

new text to NYSE Amex Equities Rule 

128(c)(4) to provide clarity in the clearly 

erroneous process when a Pause Pilot 

trading pause is triggered. Pursuant to 

NYSE Amex Equities Rule 128(c)(4), 

Latency Trades will be broken by the 

Exchange if they exceed the applicable 

percentage from the Reference Price, as 

noted in the table found under NYSE 

Amex Equities Rule 128(c)(1).9 The 

Reference Price, for purposes of NYSE 

Amex Equities Rule 128(c)(4), is the 

price that triggered a trading pause 

pursuant to the Pause Pilot (the 

‘‘Trading Pause Trigger Price’’). As such, 

Latency Trades that occur on the 

Exchange would be broken by the 

Exchange pursuant to NYSE Amex 

Equities Rule 128(c)(4) if the transaction 

occurred at either three, five or ten 

percent above the Trading Pause Trigger 

Price.10

On June 23, 2011, the Commission 

approved a joint proposal to expand the 

respective Pause Pilot rules of the 

Exchanges and FINRA to include all 

remaining NMS stocks (‘‘Phase III 

Securities’’).11 The new pilot rules, 

which will be implemented on August 

8, 2011, not only expand the application 

of the Pause Pilot, but also apply larger 

percentage moves that trigger a pause to 

the Phase III Securities. The Exchange 

amended its Pause Pilot rule, NYSE 

Amex Equities Rule 80C, by adding 

three new subparagraphs to NYSE Amex 

Equities Rule 80C(a) to address the 

treatment of the Phase III Securities. The 

rule applicable to the original Pause 

Pilot securities was placed in new NYSE 

Amex Equities Rule 80C(a)(i). The rules 

applicable to the Phase III Securities 

were placed in new NYSE Amex 

Equities Rule 80C(a)(ii) and (iii). A 

pause under NYSE Amex Equities Rule 

80C(a)(ii) is triggered by a 30 percent 

price move within a five minute period 

in a Phase III Security that had a closing 

price on the previous trading day of $1 

or more. A pause under NYSE Amex 

Equities Rule 80C(a)(iii) is triggered by 

a 50 percent price move within a five 

minute period in a Phase III Security 

that had a closing price on the previous 

trading day of less than $1. If no prior 

day closing price is available, the last 

sale reported to the Consolidated Tape 

on the previous trading day is used. 

The Exchange has submitted 

immediately effective proposed rule 

changes to the Commission to extend 

both the Pause Pilot under NYSE Amex 

Equities Rule 80C and the clearly 

erroneous execution process pilot under 

NYSE Amex Equities Rule 128 until 

January 31, 2012.12

The Issue 

The recently-approved changes to the 

Pause Pilot will have the unintended 

effect of removing the Phase III 

Securities from the normal clearly 

erroneous process and potentially result 

in unfair outcomes in the face of severe 

volatility in such securities. Phase III 

Securities are currently subject to the 

clearly erroneous process under NYSE 

Amex Equities Rule 128(c)(1)–(3), which 

applies to all securities except the 

current Pause Pilot securities subject to 

a pause. For purposes of transactions in 

securities not involving Pause Pilot 

securities, or transactions involving 

Pause Pilot securities that occur when 

there is not a pause pursuant to the 

Pause Pilot, the Reference Price is the 

consolidated last sale price immediately 

prior to the execution(s) under review, 

subject to certain exceptions.13 As noted 

above, the Trading Pause Trigger Price 

is used as the Reference Price when a 

Pause Pilot pause is in effect. As a 

consequence, under the current rules a 

Latency Trade is subject to the clearly 

erroneous thresholds based on the 

Trading Pause Trigger Price, which 

represents a ten percent or greater move 

in the transacted price of the security in 

a five minute period. 

Under the amended Pause Pilot rule, 

a Latency Trade in a Phase III Security 

occurs only after either a 30 or 50 

percent (or greater) move in the 

transacted price of the security in a five 

minute period. As a result, a member 

organization that trades in a Phase III 

Security that triggers a clearly erroneous 

threshold of three, five or ten percent 

from the Reference Price, yet falls below 

the Pause Pilot trigger of either 30 or 50 

percent, would be able to avail 

themselves of a clearly erroneous 

review. A similarly situated member 

organization that transacts in the same 

security as a Latency Trade at a price 

equal to or greater than the Phase III 

Security thresholds, yet less than the 

clearly erroneous thresholds under 

NYSE Amex Equities Rule 128(c)(1), 

would not be able to avail themselves of 

the clearly erroneous process. Another 

member organization that transacts in 

the same security as a Latency Trade 

that exceeds three, five or ten percent 

from the Trading Pause Trigger Price 

would automatically receive clearly 

erroneous relief. The Exchange believes 

that this would be an inequitable result 

and an arbitrary application of the 

clearly erroneous process. Specifically, 

the Exchange believes that, since the 30 

and 50 percent triggers of the Pause 

Pilot are substantially greater than the 

10 percent threshold of the original 

Pause Pilot, the Phase III Securities 

should remain under the current clearly 

erroneous process of NYSE Rule 

128(c)(1)–(3). 

Applying the clearly erroneous 

process under NYSE Amex Equities 

Rule 128(c)(1)–(3) to the Phase III 

Securities would allow the Exchange to 

review all transactions that exceed the 

normal clearly erroneous thresholds and 

Reference Price, and, importantly, avoid 

arbitrary selection of ‘‘winners’’ and 

‘‘losers’’ in the face of severe volatile 

moves in a security of 30 or 50 percent 

over a five minute period. For example, 

a member organization that trades in a 


Emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 51113 

14NYSE Amex notes that the Exchanges are filing 

similar proposals to make the changes proposed 

herein. 

15 15 U.S.C. 78f(b)(5). 

16 15 U.S.C. 78k–1(a)(1). 

17 15 U.S.C. 78s(b)(3)(A). 

18 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 

19b–4(f)(6)(iii) requires that a self-regulatory 

organization 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 filing of the proposed rule change, or 

such shorter time as designated by the Commission. 

The Commission is waiving the five day written 

notice requirement in this case. Therefore, the 

Commission notes that the Exchange has satisfied 

this requirement. 

19For 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). 

security subject to NYSE Amex Equities 

Rule 80C(a)(ii) and (iii) that triggers a 

clearly erroneous threshold of three, five 

or ten percent, yet falls below the Pause 

Pilot trigger threshold trading at 29 

percent from the prior day’s closing 

price, would be potentially entitled to a 

clearly erroneous break pursuant NYSE 

Amex Equities Rule 128(c)(1). Should 

trading in that same security trigger a 

trading pause at a price of 30 or 50 

percent greater than the prior day’s 

close, the member organization would 

not be entitled to a clearly erroneous 

trade break unless that trade exceeded 

three, five or ten percent beyond the 

price that triggered the pause. This 

scenario causes an inequity among a 

group of member organizations that 

have transactions in the Phase III 

Securities falling between the three, five 

and ten percent thresholds from the 

Reference Price under the normal NYSE 

Amex Equities Rule 128(c)(1) clearly 

erroneous process and the Pause Pilot 

clearly erroneous triggers of three, five 

or ten percent away from the Trading 

Pause Trigger Price. Such member 

organizations would not be provided 

relief under the clearly erroneous rules 

merely due to the imposition of a Pause 

Pilot halt, notwithstanding that other 

member organizations with transactions 

that occur at the same rolling five 

minute percentage difference. The 

Exchange believes a better outcome is to 

afford all member organizations 

transacting in Phase III Securities the 

opportunity of having such trades 

reviewed. 

Summary 

The expansion of the Pause Pilot to 

the Phase III Securities will have the 

unintended consequence of setting the 

point at which a clearly erroneous 

transaction occurs once a Pause Pilot 

pause is initiated far beyond the triggers 

applied prior to the expansion, which 

will, in turn, prevent certain market 

participants from availing themselves of 

the clearly erroneous rules, 

notwithstanding that other similarly 

situated participants are able to do so. 

The Exchange believes that this would 

be an arbitrary application of the clearly 

erroneous process in a manner that is 

unfair and not consistent with the spirit 

and purpose of the rule. Accordingly, 

the Exchange is proposing to amend 

NYSE Amex Equities Rule 128(c)(1)–(4) 

to specify that NYSE Amex Equities 

Rule 128(c)(4) applies only to the 

current securities of the Pause Pilot, as 

found under NYSE Amex Equities Rule 

80C(a)(i).14

2. Statutory Basis 

The statutory basis for the proposed 

rule change is Section 6(b)(5) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),15 which requires the rules of an 

exchange 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 proposed rule 

change also is designed to support the 

principles of Section 11A(a)(1) of the 

Act 16 in that it seeks to assure fair 

competition among brokers and dealers 

and among exchange markets. The 

Exchange believes that the proposed 

rule meets these requirements in that it 

promotes transparency and uniformity 

across markets concerning decisions to 

break erroneous trades, yet also ensures 

fair application of the process so that 

similarly situated member organizations 

are provided the same opportunity of a 

clearly erroneous review. The Exchange 

notes that the changes proposed herein 

will in no way interfere with the 

operation of the Pause Pilot process, as 

amended. 

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. 

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 

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) of the Act 17 and Rule 19b– 

4(f)(6)(iii) thereunder.18 The Exchange 

has asked the Commission to waive the 

30-day operative delay so that the 

proposal may become operative 

immediately upon filing. The 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest because such waiver will 

allow the clearly erroneous rules to 

continue to operate as they did prior to 

the effectiveness of the Pause Pilot 

expansion to Phase III Securities so that 

similarly situated member organizations 

are provided the same opportunity of a 

clearly erroneous review. Accordingly, 

the Commission waives the 30-day 

operative delay requirement and 

designates the proposed rule change as 

operative upon filing with the 

Commission.19

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 rulecomments@sec.gov. Please include File 

Number SR–NYSEAmex–2011–60 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. 


Emcdonald on DSK2BSOYB1PROD with NOTICES
51114 Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 

20 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3The ETFS is physically-backed by gold bullion 

which are held in Switzerland. 

All submissions should refer to File 

Number SR–NYSEAmex–2011–60. 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 NYSE 

Amex. 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 publicly available. All 

submissions should refer to File 

Number SR–NYSEAmex–2011–60 and 

should be submitted on or before 

September 7, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20903 Filed 8–16–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65099; File No. SR– 

NASDAQ–2011–109] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Options on ETFS Gold Trust 

August 11, 2011. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 2 thereunder, 

notice is hereby given that on August 2, 

2011, the NASDAQ Stock Market LLC 

(‘‘NASDAQ’’ or ‘‘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 NASDAQ. 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 Substance of 

the Proposed Rule Change 

The NASDAQ Stock Market LLC 

proposes to list and trade options on the 

ETFS Gold Trust. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http:// 

www.nasdaq.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. 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 purpose of the proposed rule 

change is to amend certain rules to 

enable the listing and trading on the 

Exchange of options on the ETFS Gold 

Trust (‘‘SGOL’’).3 Specifically, the 

Exchange proposes to amend Chapter 

IV, entitled ‘‘Securities Traded on 

NOM,’’ at Sec. 3 entitled ‘‘Criteria for 

Underlying Securities’’ to add SGOL to 

the list of products deemed appropriate 

for options trading. 

Exchange Rules at Chapter IV, Section 

3 list the securities deemed appropriate 

for options trading, which shall include 

shares or other securities (‘‘ExchangeTraded Fund Shares’’ or ‘‘ETFS’’), 

including but not limited to Partnership 

Units, as defined in Section 3, that are 

principally traded on a national 

securities exchange and are defined as 

an ‘‘NMS stock’’ under Rule 600 of 

Regulation NMS, and that (i) Represent 

interests in registered investment 

companies (or series thereof) organized 

as open-end management investment 

companies, unit investment trusts or 

similar entities, and that hold portfolios 

of securities comprising or otherwise 

based on or representing investments in 

indexes or portfolios of securities (or 

that hold securities in one or more other 

registered investment companies that 

themselves hold such portfolios of 

securities) (‘‘Funds’’) and/or financial 

instruments including, but not limited 

to, stock index futures contracts, options 

on futures, options on securities and 

indexes, equity caps, collars and floors, 

swap agreements, forward contracts, 

repurchase agreements and reverse 

repurchase agreements (the ‘‘Financial 

Instruments’’), and money market 

instruments, including, but not limited 

to, U.S. government securities and 

repurchase agreements (the ‘‘Money 

Market Instruments’’) constituting or 

otherwise based on or representing an 

investment in an index or portfolio of 

securities and/or Financial Instruments 

and Money Market Instruments, or (ii) 

represent commodity pool interests 

principally engaged, directly or 

indirectly, in holding and/or managing 

portfolios or baskets of securities, 

commodity futures contracts, options on 

commodity futures contracts, swaps, 

forward contracts and/or options on 

physical commodities and/or non-U.S. 

currency (‘‘Commodity Pool ETFs’’) or 

(iii) represent interests in a trust or 

similar entity that holds a specified nonU.S. currency or currencies deposited 

with the trust or similar entity when 

aggregated in some specified minimum 

number may be surrendered to the trust 

by the beneficial owner to receive the 

specified non-U.S. currency or 

currencies and pays the beneficial 

owner interest and other distributions 

on the deposited non-U.S. currency or 

currencies, if any, declared and paid by 

the trust (‘‘Currency Trust Shares’’), or 

(iv) represent interests in the SPDR Gold 

Trust or are issued by the iShares 

COMEX Gold Trust or iShares Silver 

Trust. This rule change proposes to 

expand the types of ETFs that may be 

approved for options trading to include 

SGOL. 

Apart from allowing SGOL to be an 

underlying for options traded in the 

Exchange as described above, the listing 

standards for ETFs will remain 

unchanged from those that apply under 

current Exchange Rules. ETFs on which 

options may be listed and traded must 

still be listed and traded on a national 


Emcdonald on DSK2BSOYB1PROD with NOTICES