81130 Federal Register / Vol. 88, No. 223 / Tuesday, November 21, 2023 / Notices 

39 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 98621 

(September 28, 2023), 88 FR 68896 (‘‘Notice’’). 

4See Rule 4.13(e). 

5See Notice, supra note 3 at 68897. 

6See id. 

7See id. 

8See id. 

9See id. 

10For a more detailed description of the proposed 

Tuesday or Thursday expirations, see Notice, supra 

note 3. 

11 In approving this proposed rule change, the 

Commission has considered the proposed rule’s 

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 rule-comments@

sec.gov. Please include file number SR– 

PEARL–2023–63 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–PEARL–2023–63. 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–PEARL–2023–63 and should be 

submitted on or before December 12, 

2023. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.39

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–25669 Filed 11–20–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98957; File No. SR–CBOE– 

2023–054] 

Self-Regulatory Organizations; Cboe 

Exchange, Inc.; Order Approving a 

Proposed Rule Change To Amend Rule 

4.13 To Expand the Nonstandard 

Expirations Program To Include P.M.- 

Settled Options on Broad-Based 

Indexes That Expire on Tuesday or 

Thursday 

November 15, 2023. 

I. Introduction 

On September 28, 2023, Cboe 

Exchange, Inc. (‘‘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 Rule 4.13(e), which 

governs its Nonstandard Expirations 

Program (‘‘Program’’), to permit p.m.- 

settled options on any broad-based 

index eligible for standard options 

trading that expire on Tuesday or 

Thursday. The proposed rule change 

published for comment in the Federal 

Register on October 4, 2023.3 The 

Commission did not receive any 

comment letters and is approving the 

proposed rule change. 

II. Description of the Proposal 

The Exchange proposes to amend 

Rule 4.13(e), which governs its Program, 

to permit p.m.-settled options on any 

broad-based index eligible for standard 

options trading that expire on Tuesday 

or Thursday. Currently under the 

Program, the Exchange is permitted to 

list p.m.-settled options on any broadbased index eligible for standard trading 

that expire on: (1) any Monday, 

Wednesday, or Friday (other than the 

third Friday-of-the-month or days that 

coincide with an end-of-month 

expiration and, with respect to options 

on the S&P 500 Index (‘‘SPX options’’) 

and the Mini-S&P 500 Index (‘‘XSP 

options’’) any Tuesday or Thursday 

(‘‘Weekly Expirations’’) and (2) the last 

trading day of the month (‘‘End of 

Month Expirations’’ or ‘‘EOMs’’).4 The 

proposal expands the availability of 

Tuesday and Thursday Weekly 

Expirations to all broad-based indexes 

eligible for standard options trading.5

The Program for Weekly Expirations 

will apply to any broad-based index 

option with Tuesday and Thursday 

expirations in the same manner as it 

currently applies to all other p.m.- 

settled broad-based index options with 

Monday, Wednesday, and Friday 

expirations and to SPX and XSP options 

with Tuesday and Thursday 

expirations.6 Specifically, as set forth in 

Rule 4.13(e), Weekly Expirations, 

including the proposed Tuesday and 

Thursday expirations, are subject to all 

provisions of Rule 4.13 and treated the 

same as options on the same underlying 

index that expire on the third Friday of 

the expiration month; provided, 

however, that Weekly Expirations are 

p.m.-settled, and new series in Weekly 

Expirations may be added up to and 

including on the expiration date for an 

expiring Weekly Expiration.7

The maximum number of expirations 

that may be listed for each Weekly 

Expiration (i.e., a Monday expiration, 

Tuesday expiration, Wednesday 

expiration, Thursday expiration, or 

Friday expiration, as applicable) in a 

given class is the same as the maximum 

number of expirations permitted in Rule 

4.13(a)(2) for standard options on the 

same broad-based index.8 Weekly 

Expirations need not be for consecutive 

Monday, Tuesday, Wednesday, 

Thursday, or Friday expirations as 

applicable; 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.9 Weekly Expirations that 

are first listed in a given class may 

expire up to four weeks from the actual 

listing date.10 In addition, like all 

Weekly Expirations, pursuant to Rule 

4.13(e)(3), transactions in expiring 

broad-based index options with 

Tuesday and Thursday expirations may 

be effected on the Exchange between the 

hours of 9:30 a.m. and 4:00 p.m. eastern 

time on their last trading day. 

III. Discussion and Commission 

Findings 

After careful review, the Commission 

finds that the proposed rule change is 

consistent with the Act and the rules 

and regulations thereunder applicable to 

a national securities exchange.11 In 


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Federal Register / Vol. 88, No. 223 / Tuesday, November 21, 2023 / Notices 81131 

impact on efficiency, competition, and capital 

formation. See 15 U.S.C. 78c(f). 

12 15 U.S.C. 78f(b)(5). 

13See Securities Exchange Act Release No. 98456 

(September 20, 2023), 88 FR 66091 (September 26, 

2023) (SR–CBOE–2023–020) (permanent approval 

of nonstandard expirations pilot program) 

(‘‘Nonstandard Approval Order’’). 

14See Notice, supra note 3 at 68898. 

15See id. 

16See id. 

17See Securities Exchange Act Release No. 65256 

(September 2, 2011), 76 FR 55969, at 55972 

(September 9, 2011) (SR–C2–2011–008) (Order 

approving proposed rule change to establish a pilot 

program to list and trade SPXPM options on the C2 

Options Exchange, Incorporated). 

18See, e.g., Securities Exchange Act Release Nos. 

98454 (September 20, 2023), 88 FR 66103 at 66103– 

04 (September 26, 2023) (SR–CBOE–2023–005) 

(Order approving p.m.-settled Third Friday SPX 

options); 98450 (September 20, 2023), 88 FR 66 111 

(September 26, 2023) (SR–ISE–2023–08) (Order 

Granting Approval of a Proposed Rule Change, as 

Modified by Amendment No. 1, to Make Permanent 

Certain P.M.-Settled Pilots); 98451 (September 20, 

2023), 88 FR 66088 (September 26, 2023) (SR–Phlx– 

203–07) (Order approving a nonstandard 

expirations pilot program and p.m.-settled XND 

options); and Nonstandard Approval Order. 

19See e.g., Nonstandard Approval Order, 88 FR 

at 66094. 

20See id. 

21See supra note 13. 

22See supra note 16 and accompanying text. 

23 15 U.S.C. 78f(b)(5). 

24 15 U.S.C. 78s(b)(2). 

25 17 CFR 200.30–3(a)(12). 

1On May 31, 2012, the Commission approved the 

Plan, as modified by Amendment No. 1. See 

Securities Exchange Act Release No. 67091, 77 FR 

33498 (June 6, 2012) (File No. 4–631) (‘‘Approval 

Order’’). On February 20, 2013, the Commission 

Continued 

particular, the Commission finds that 

the proposed rule change is consistent 

with Section 6(b)(5) of the Act,12 which 

requires, among other things, that the 

Exchange’s rules be designed to prevent 

fraudulent and manipulative acts and 

practices, 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. 

In support of its proposal, the 

Exchange notes that the Commission 

recently approved the listing of Tuesday 

and Thursday expirations for SPX and 

XSP options in addition to Monday, 

Wednesday, and Friday expirations for 

options on any broad-based index 

eligible for standard options trading.13

The Exchange states that the 

introduction of Tuesday and Thursday 

expirations for all broad-based index 

options (rather than offering those 

expirations for just two indexes) will 

provide investors with expanded 

hedging tools and greater trading 

opportunities and flexibility, and will 

allow market participants to trade in a 

manner more aligned with specific 

timing needs and more effectively tailor 

their investment and hedging strategies 

and manage their portfolios.14 The 

Exchange further believes that the 

listing of additional p.m.-settled options 

on other broad-based indexes will not 

have any significant economic impact 

on the underlying component securities 

surrounding the close as a result of 

expiring p.m.-settled options or impact 

market quality.15 Finally, the Exchange 

represents it has sufficient capacity to 

handle additional traffic associated with 

trading of broad-based index options 

with Tuesday and Thursday expirations, 

and will monitor the trading volume 

associated with any possible additional 

options series listed as a result of this 

proposal and the effect (if any) of these 

additional series on market 

fragmentation and on the capacity of the 

Exchange’s automated systems.16

The Commission has had concerns 

about the adverse effects and impact of 

p.m.-settlement upon market volatility 

and the operation of fair and orderly 

markets on the underlying cash market 

at or near the close of trading on 

expiration days.17 However, the 

Commission recently approved 

proposals from several exchanges, 

including the Exchange, to permanently 

establish programs permitting the listing 

and trading of certain p.m.-settled 

broad-based index options.18 In 

approving these proposals, the 

Commission reviewed data provided by 

the exchanges in their filings, the 

exchanges’ pilot data and reports, as 

well as an analysis conducted at the 

direction of Staff from the Commission’s 

Division of Economic and Risk Analysis 

and concluded that analysis of the pilot 

data did not identify any significant 

economic impact on the underlying 

component securities surrounding the 

close as a result of expiring p.m.-settled 

options nor did it indicate a 

deterioration in market quality for an 

existing product when a new p.m.- 

settled expiration was introduced.19

Further, the Commission stated that 

significant changes in closing 

procedures in the decades since index 

options moved to a.m. settlement may 

also serve to mitigate the potential 

impact of p.m.-settled index options on 

the underlying cash markets.20

As noted above, the Exchange 

currently may list Tuesday and 

Thursday expirations for SPX and XSP 

options in addition to Monday, 

Wednesday, and Friday expirations for 

options on any broad-based index 

eligible for standard options trading.21

The Exchange’s proposal, which would 

permit Tuesday and Thursday 

expirations for options on any broadbased index, is reasonably designed as 

a limited expansion of existing p.m.- 

settled broad-based index option 

programs and may provide the investing 

public and other market participants 

more flexibility to closely tailor their 

investment and hedging decisions. The 

Exchange has represented that it has 

adequate systems capacity and that it 

will monitor trading of broad-based 

index options with Tuesday and 

Thursday expirations.22 The 

Commission expects the Exchange to 

continue to monitor any potential risks 

from large p.m.-settled positions and 

take appropriate action on a timely basis 

if warranted. 

Accordingly, the Commission finds 

that the proposed rule change is 

consistent with Section 6(b)(5) of the 

Act 23 and the rules and regulations 

thereunder applicable to a national 

securities exchange. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,24 that the 

proposed rule change (SR–CBOE–2023– 

054) be, and hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.25

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–25670 Filed 11–20–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98928; File No. 4–631] 

Joint Industry Plan; Notice of Filing of 

the Twenty-Third Amendment to the 

National Market System Plan To 

Address Extraordinary Market 

Volatility by Cboe BYX Exchange, Inc., 

Cboe BZX Exchange, Inc., Cboe EDGA 

Exchange, Inc., Cboe EDGX Exchange, 

Inc., Financial Industry Regulatory 

Authority, Inc., Investors Exchange 

LLC, Long-Term Stock Exchange, Inc., 

MEMX LLC, MIAX Pearl, LLC, NASDAQ 

BX, Inc., NASDAQ PHLX LLC, The 

NASDAQ Stock Market LLC, New York 

Stock Exchange LLC, NYSE American 

LLC, NYSE Arca, Inc., NYSE Chicago, 

Inc., and NYSE National, Inc. 

November 14, 2023. 

I. Introduction 

On October 24, 2023, NYSE Group, 

Inc., on behalf of the following parties 

to the National Market System Plan to 

Address Extraordinary Market Volatility 

(‘‘the Plan’’): 1 Cboe BZX Exchange, Inc., 


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