20658 Federal Register / Vol. 77, No. 66 / Thursday, April 5, 2012 / Notices 

5See Securities Exchange Act Release No. 58375 

(August 18, 2008) 73 FR 49498 (August 21, 2008); 

see also Securities Exchange Act Release No. 57322 

(February 13, 2008), 73 FR 9370 (February 20, 

2008). 

6BATS Rule 11.9(c)(8). 

7 15 U.S.C. 78f(b). 

8 15 U.S.C. 78f(b)(5). 

9 Id. 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 12 17 CFR 200.30–3(a)(12). 

problem. Rapid updates to displayed 

Primary Pegged Orders may still occur, 

but are more likely to be the result of 

rapid trading. Market Pegged Orders, in 

contrast to Primary Pegs with an offset 

amount, are typically priced to execute 

and rarely post, and thus also do not 

present the excessive messaging 

problem. 

The Commission approved the nondisplay of Pegged Orders when it 

approved the application of BATS 

Exchange, Inc. (‘‘BATS’’), for 

registration as a national securities 

exchange and found BATS’ proposed 

rules consistent with Section 6 of the 

Act.5 BATS Rule 11.9(c)(8) provides that 

Pegged Orders ‘‘are not displayed on the 

Exchange.’’ 6

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the Act,7

in general, and furthers the objectives of 

Section 6(b)(5),8 in particular, in that it 

is 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 

facilitating transactions in securities, 

and to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. Non-display of Primary Pegged 

Orders with an offset amount will 

minimize excess messaging that 

distracts from, rather than improves 

transparency and stability. Market 

participants can elect to display orders 

by using other available order types. 

The Exchange believes that the 

proposed change to Rule 3301(f)(4) 

meets the requirements of Section 

6(b)(5) of the Act 9 in that it will 

improve the stability, quality and 

transparency of the national market 

system. 

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. Specifically, 

the Exchange believes that providing for 

non-display of Primary Pegged Orders 

will not burden competition since at 

least one other exchange currently offers 

the same attribute for pegged orders. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days after the date of 

the filing, or such shorter time as the 

Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 10 and Rule 19b– 

4(f)(6) thereunder.11

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rulecomments@sec.gov. Please include File 

Number SR–Phlx–2012–39 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. 

All submissions should refer to File 

Number SR–Phlx–2012–39. 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 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 the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. All comments received will 

be posted without change; 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 

Number SR–Phlx–2012–39 and should 

be submitted on or before April 26, 

2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–8168 Filed 4–4–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66699; File No. SR– 

NASDAQ–2012–041] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Related to NonDisplay of Primary Pegged Orders With 

an Offset Amount 

March 30, 2012. 

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

Securities Exchange Act of 1934 


Tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 66 / Thursday, April 5, 2012 / Notices 20659 

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

2 17 CFR 240.19b–4. 

3 17 CFR 240.19b–4(f)(6). 

4See Securities Exchange Act Release No. 58375 

(August 18, 2008) 73 FR 49498 (August 21, 2008) 

(File No. 10–182); see also Securities Exchange Act 

Release No. 57322 (February 13, 2008), 73 FR 9370 

(February 20, 2008) (File No. 10–182). 

5BATS Rule 11.9(c)(8). 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(5). 

8 Id. 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 240.19b–4(f)(6). 

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

notice is hereby given that on March 23, 

2012, The NASDAQ Stock Market LLC 

(‘‘NASDAQ’’ or ‘‘Exchange’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II and III below, which Items 

have been prepared by the Exchange. 

The Exchange has designated the 

proposed rule change as constituting a 

rule change under Rule 19b–4(f)(6) 

under the Act,3 which renders the 

proposal effective upon filing with the 

Commission. 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 provide 

that Primary Pegged Orders with an 

offset amount will never be displayed. 

The text of the proposed rule change is 

available on the Exchange’s Web site at 

http://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 

NASDAQ proposes to amend Rule 

4751(f)(4) to provide that Primary 

Pegged Orders with an offset amount 

will be non-displayed, a change that 

will improve system and inter-market 

price stability. Pegged Orders are orders 

that, once entered, adjust in price 

automatically, in response to changes in 

the inside bids or offers of the Nasdaq 

Market Center or the national market 

system, depending upon the type of 

Pegged Order. A Primary Pegged Order 

specifies that its price will equal the 

inside quote on the same side of the 

market; a Market Pegged Order will 

equal the inside quote on the opposite 

side of the market. A Midpoint Peg 

Order will equal the midpoint of the 

national best bid and offer (‘‘NBBO’’), 

excluding the effect that the Midpoint 

Peg Order itself has on the inside bid or 

inside offer. As the bids and offers 

change, so move the Pegged Orders. A 

Pegged Order may have a limit price 

beyond which the order shall not be 

executed. Primary Peg and Market Peg 

Orders may establish their pricing 

relative to the appropriate bids or offers 

by selecting one or more offset amounts 

that will adjust the price of the order by 

the offset amount selected. 

Under the Exchange’s current rule, 

Midpoint Pegged Orders are not 

displayed, while Primary and Market 

Pegged Orders may be displayed or not 

displayed, at the option of the person 

placing the order. The display of 

Primary Pegs with an offset amount can 

potentially result in excessive 

messaging when multiple venues 

display Pegged non-marketable Orders. 

In these scenarios, it is possible for the 

Primary Pegged Orders on each venue to 

react to and change in relation to each 

other, resulting in excessive messaging 

and ‘‘quote flickering’’. A rule change to 

eliminate display of Primary Pegged 

Orders with an offset amount will 

prevent this feedback loop, adding to 

system stability and improving market 

quality. 

Market participants retain the ability 

to display orders through other order 

options available under the Exchange 

rules, including by using Primary 

Pegged Orders without an offset amount 

or Market Pegged Orders. Because 

Primary Pegged Orders without an offset 

amount are priced at the inside quote, 

they do not present the same messaging 

problem. Rapid updates to displayed 

Primary Pegged Orders may still occur, 

but are more likely to be the result of 

rapid trading. Market Pegged Orders, in 

contrast to Primary Pegs with an offset 

amount, are typically priced to execute 

and rarely post, and thus also do not 

present the excessive messaging 

problem. 

The Commission approved the nondisplay of Pegged Orders when it 

approved the application of BATS 

Exchange, Inc. (‘‘BATS’’), for 

registration as a national securities 

exchange and found BATS’ proposed 

rules consistent with Section 6 of the 

Act.4 BATS Rule 11.9(c)(8) provides that 

Pegged Orders ‘‘are not displayed on the 

Exchange.’’ 5

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the Act,6

in general, and furthers the objectives of 

Section 6(b)(5),7 in particular, in that it 

is 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 

facilitating transactions in securities, 

and to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. Non-display of Primary Pegged 

Orders with an offset amount will 

minimize excess messaging that 

distracts from, rather than improves 

transparency and stability. Market 

participants can elect to display orders 

by using other available order types. 

The Exchange believes that the 

proposed change to Rule 4751(f)(4) 

meets the requirements of Section 

6(b)(5) of the Act 8 in that it will 

improve the stability, quality and 

transparency of the national market 

system. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

NASDAQ 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, as amended. 

Specifically, the Exchange believes that 

providing for non-display of Primary 

Pegged Orders will not burden 

competition since at least one other 

exchange currently offers the same 

attribute for pegged orders. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The proposed rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) of the Act 9 and Rule 19b– 

4(f)(6) 10 thereunder in that the proposed 

rule change: (i) Does not significantly 

affect the protection of investors or the 

public interest; (ii) does not impose any 


Tkelley on DSK3SPTVN1PROD with NOTICES
20660 Federal Register / Vol. 77, No. 66 / Thursday, April 5, 2012 / Notices 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3A Managed Fund Share is a security that 

represents an interest in an investment company 

registered under the Investment Company Act of 

1940 (15 U.S.C. 80a–1) (‘‘1940 Act’’) organized as 

an open-end investment company or similar entity 

that invests in a portfolio of securities selected by 

its investment adviser consistent with its 

investment objectives and policies. In contrast, an 

open-end investment company that issues 

Investment Company Units, listed and traded on 

the Exchange under NYSE Arca Equities Rule 

5.2(j)(3), seeks to provide investment results that 

correspond generally to the price and yield 

performance of a specific foreign or domestic stock 

index, fixed income securities index or combination 

thereof. 

4The Commission has previously approved 

listing and trading on the Exchange of a number of 

actively managed funds under Rule 8.600. See, e.g., 

Securities Exchange Act Release Nos. 57801 (May 

8, 2008), 73 FR 27878 (May 14, 2008) (SR– 

NYSEArca–2008–31) (order approving Exchange 

listing and trading of twelve actively-managed 

funds of the WisdomTree Trust); 60460 (August 7, 

2009), 74 FR 41468 (August 17, 2009) (SR– 

NYSEArca–2009–55) (order approving listing of 

Dent Tactical ETF); 63076 (October 12, 2010), 75 FR 

63874 (October 18, 2010) (SR–NYSEArca–2010–79) 

(order approving Exchange listing and trading of 

Cambria Global Tactical ETF); 63802 (January 31, 

2011), 76 FR 6503 (February 4, 2011) (SR– 

NYSEArca–2010–118) (order approving Exchange 

listing and trading of the SiM Dynamic Allocation 

significant burden on competition; and 

(iii) by its terms, does not become 

operative for 30 days after the date of 

the filing, or such shorter time as the 

Commission may designate if consistent 

with the protection of investors and the 

public interest. NASDAQ believes that 

the proposed rule change does not 

significantly affect the protection of 

investors or the public interest because 

it adopts a provision that is already in 

effect on another market; will operate to 

minimize excessive messaging and 

therefore maximize system and intermarket stability; and is an order type 

that participants may elect to use but are 

not mandated to use. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rulecomments@sec.gov. Please include File 

Number SR–NASDAQ–2012–041 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. 

All submissions should refer to File 

Number SR–NASDAQ–2012–041. 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 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 the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. All comments received will 

be posted without change; 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 

Number SR–NASDAQ–2012–041 and 

should be submitted on or before April 

26, 2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–8150 Filed 4–4–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66696; File No. SR– 

NYSEArca–2012–24] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing of Proposed 

Rule Change Relating to Listing and 

Trading of AdvisorShares Global Echo 

ETF Under NYSE Arca Equities Rule 

8.600 

March 30, 2012. 

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

Securities Exchange Act of 1934 

(‘‘Exchange Act’’ or ‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 notice is hereby 

given that, on March 16, 2012, NYSE 

Arca, Inc. (‘‘Exchange’’ or ‘‘NYSE Arca’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been substantially prepared by the 

Exchange. 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 list and 

trade the following under NYSE Arca 

Equities Rule 8.600 (‘‘Managed Fund 

Shares’’): AdvisorShares Global Echo 

ETF. The text of the proposed rule 

change is available at the Exchange, 

www.nyse.com, and 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 

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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to list and 

trade shares (‘‘Shares’’) of the following 

under NYSE Arca Equities Rule 8.600, 

which governs the listing and trading of 

Managed Fund Shares: 3 AdvisorShares 

Global Echo ETF (‘‘Fund’’).4 The Shares 


Tkelley on DSK3SPTVN1PROD with NOTICES