[Federal Register Volume 89, Number 187 (Thursday, September 26, 2024)]
[Notices]
[Pages 78950-78955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-22026]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101120; File No. SR-CBOE-2024-043]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
the Exchange's Rules To Permit the Listing and Trading of Options Based 
on 1/100 of the Value of the Nasdaq-100 Index[supreg] (``Nasdaq-100'')

September 20, 2024.
    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 September 18, 2024, Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe 
Options'') 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

[[Page 78951]]

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)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes 
to amend the Exchange's rules to permit the listing and trading of 
options based on 1/100 of the value of the Nasdaq-100 Index[supreg] 
(``Nasdaq-100''). The text of the proposed rule change is provided in 
Exhibit 5.
    The text of the proposed rule change is also available on the 
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, 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 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 purpose of this proposed rule change is to amend certain rules 
to permit the Exchange to list and trade index options on Nasdaq 100 
Micro Index Options (``XND''). The XND options contract is the same in 
all respects as the current Nasdaq-100 Index options (``NDX'') \5\ 
contract listed on the Exchange, except that it is based on 1/100 of 
the value of the Nasdaq-100 Index, and will be P.M.-Settled with an 
exercise settlement value based on the closing index value of the 
Nasdaq-100 Index on the day of expiration.\6\ The Exchange believes 
that the proposed contract will be valuable for retail and other 
investors that wish to trade micro options on the Nasdaq-100 Index. 
Today, Nasdaq Phlx LLC (``Phlx'') \7\ and Nasdaq ISE, LLC (``ISE'') \8\ 
have approval to list and trade XND options. The proposed rules to list 
and trade XND options on the Exchange are substantially similar to 
those of Phlx and ISE.
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    \5\ See Rule 4.13(a)(3).
    \6\ In addition to the current Nasdaq-100 Index value, Nasdaq 
disseminates an index value for XND that is 1/100 of the value of 
the Nasdaq-100 Index.
    \7\ See Securities Exchange Act Release No. 98451 (September 20, 
2023), 88 FR 66088 (September 26, 2023) (SR-Phlx-2023-07) (Order 
Granting Approval of a Proposed Rule Change, as Modified by 
Amendment No. 1, To Make Permanent Certain P.M.-Settled Pilots).
    \8\ See Securities Exchange Act Release No. 98886 (November 8, 
2023), 88 FR 78417 (November 15, 2023) (SR-ISE-2023-24) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Permit 
the Listing and Trading of XND Options).
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Nasdaq-100 Index
    The Nasdaq-100 Index is a modified market capitalization-weighted 
index that includes 100 of the largest non-financial companies listed 
on The Nasdaq Stock Market LLC (``Nasdaq''), based on market 
capitalization.\9\ It does not contain securities of financial 
companies, including investment companies. Security types generally 
eligible for the Nasdaq-100 Index include common stocks, ordinary 
shares, American Depository Receipts, and tracking stocks. Security or 
company types not included in the Nasdaq-100 Index are closed-end 
funds, convertible debentures, exchange traded funds, limited liability 
companies, limited partnership interests, preferred stocks, rights, 
shares or units of beneficial interest, warrants, units and other 
derivative securities.\10\
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    \9\ The Nasdaq-100 Index is a broad-based index. See Rule 4.10.
    \10\ A description of the Nasdaq-100 Index is available on 
Nasdaq's website at https://indexes.nasdaqomx.com/docs/methodology_NDX.pdf.
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XND Options Contract
    Currently, the Exchange is permitted to list NDX options that are 
based on the full value of the Nasdaq-100 Index. The Exchange now 
proposes to amend its Rules to permit the listing of a new micro option 
contract based on this index. XND options will trade independently of 
and in addition to NDX options, and the XND options will be subject to 
the same rules that presently govern the trading of index options based 
on the Nasdaq-100 Index, including sales practice rules, margin 
requirements, trading rules, and position and exercise limits. Similar 
to NDX, XND options will be European-style and cash-settled, and will 
have a contract multiplier of 100. The contract specifications for XND 
options will mirror in all respects those of the NDX options contract 
already permitted to be listed on the Exchange, except that the 
Exchange proposes that XND options will be based on 1/100 of the value 
of the Nasdaq-100 Index, and will be P.M.-settled pursuant to proposed 
Rule 4.13, Interpretation and Policy .14. The Exchange also proposes to 
amend Rule 4.13(a)(4) to permit options on the Nasdaq 100 Micro Index 
to trade a.m.-settled.
    Pursuant to Rule 4.13(e), the Exchange would be permitted to open 
for trading Weekly Expirations on XND, as a broad-based index and part 
of the Nonstandard Expirations Program, to expire on any Monday, 
Tuesday, Wednesday, Thursday or Friday (other than the third Friday-of-
the-month or days that coincide with an EOM expiration). ISE's rules 
similarly permit XND to expire on any Monday, Tuesday, Wednesday, 
Thursday or Friday.\11\ Weekly Expirations in XND would be 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 shall be 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. 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.
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    \11\ See ISE Rules, Options 4A, Section 12, Supplementary 
Material .07.
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    Further, the Exchange may open for trading EOMs on any broad-based 
index eligible for standard options trading to expire on the last 
trading day of the month. EOMs shall be 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 EOMs shall be P.M.-settled and new series in EOMs may be 
added up to and including on the expiration date for an expiring 
EOM.\12\ Today, XND options on Phlx \13\ and ISE \14\ are part of the 
Nonstandard Program.
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    \12\ XND is a broad-based index.
    \13\ See Phlx Options 4A, Section 12(b)(5).
    \14\ See ISE Rules, Options 4A, Section 12, Supplementary 
Material .07.

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[[Page 78952]]

    The Exchange does not believe that the introduction of a new P.M.-
settled Nasdaq-100 Index contract will cause any market disruptions, as 
noted herein, because the proposed rule change is substantially similar 
in all material respects to a proposal submitted by Phlx \15\ that was 
previously approved by the Commission, as well as a proposal submitted 
by ISE \16\ that was subject to Commission review. The Exchange will 
monitor for any disruptions caused by P.M.-settlement of the proposed 
XND options contract or the development of any factors that could cause 
such disruptions. P.M.-settled options predominate in the over-the-
counter (``OTC'') market, and the Exchange is not aware of any adverse 
effects in the OTC market attributable to the P.M.-settlement feature. 
The Exchange is merely proposing to offer a P.M.-settled product in an 
exchange environment, which offers the additional benefits of added 
transparency, price discovery, and stability.
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    \15\ See Securities Exchange Act Release No. 98451 (September 
20, 2023), 88 FR 66088 (September 26, 2023) (SR-Phlx-2023-07) (Order 
Granting Approval of a Proposed Rule Change, as Modified by 
Amendment No. 1, To Make Permanent Certain P.M.-Settled Pilots).
    \16\ See Securities Exchange Act Release No. 98886 (November 8, 
2023), 88 FR 78417 (November 15, 2023) (SR-ISE-2023-24) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Permit 
the Listing and Trading of XND Options).
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    Additionally, the Exchange proposes to amend Rule 4.12(c) to add 
the Nasdaq 100 Mirco [sic] Index to the table regarding reporting 
authorities for indexes. The Exchange notes the Nasdaq 100 Index 
currently has the same reporting authority, i.e., Nasdaq, Inc.
Trading Hours, Minimum Increments, Expirations and Strike Prices
    XND options will be available for trading during the Exchange's 
standard trading hours for index options, i.e., from 9:30 a.m. to 4:15 
p.m. (Eastern time),\17\ except that that on the last trading day, 
transactions in expiring p.m.-settled broad-based index options may be 
effected on the Exchange between the hours of 9:30 a.m. (Eastern time) 
and 4 p.m. (Eastern time).\18\ The trading hours for XND options will 
be the same as the trading hours for options on Nasdaq-100 Index.
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    \17\ See Rule 5.1(b)(2).
    \18\ See Rule 4.13(e)(3).
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    XND options will be permitted to trade with a minimum trading 
increment of $0.01 for all options series \19\ similar to Phlx \20\ and 
ISE.\21\ The Exchange proposes to amend Rule 5.4(a) to state that for 
so long as Invesco QQQ Trust Series 1 (``QQQ'') options participate in 
the Penny Interval Program, the minimum increments for XND options 
shall be the same as QQQ for all options series (including LEAPS), 
which shall be $0.01 for options for all other series.
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    \19\ This is the case as long as QQQ options (``QQQ'') 
participate in the Penny Interval Program.
    \20\ See Phlx Supplementary Material .03 to Options 3, Section 
3.
    \21\ See ISE Rules, Options 3, Section 3.
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    The Exchange proposes that XND options will have monthly expiration 
dates on the third Friday of each month (i.e., Expiration Friday), and 
the Exchange proposes to list XND options in expiration months 
consistent with those of other index option products available on the 
Exchange.\22\ In addition, the Exchange may list long-term index 
options series (``LEAPS'') that expire from twelve (12) to one-hundred 
eighty (180) months from the date of issuance.\23\ There may be up to 
ten (10) expiration months, none further out than one-hundred eighty 
(180) months. Continuity Rules shall not apply to such options series 
until the time to expiration is less than 270 days.\24\ Further, the 
Exchange proposes to add ``Nasdaq 100 Micro Index'' to the list of 
stock indices for which reduced-value LEAPS are approved for trading on 
the Exchange, set forth in Rule 4.13(b)(2)(A). Pursuant to Rule 
4.13(b)(2)(B), reduced-value LEAPS may expire at six-month intervals. 
When a new expiration month is listed, series may be near or bracketing 
the current index value. Additional series may be added when the value 
of the underlying index increases or decreases by 10 to 15%. XND 
options would also be eligible to be added to the Short Term Option 
Series Program (``Weeklies'') and/or Quarterly Options Series Program 
(``Quarterlies'') if designated by the Rules 4.13(a)(2)(A) and 
(a)(2)(B), respectively.
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    \22\ See Rule 4.13(a)(2).
    \23\ See Rule 4.13(b).
    \24\ See Rule 5.52(d)(2).
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    Further, as noted herein, the Exchange proposes to permit XND 
options to be listed and traded in accordance with the Nonstandard 
Expirations Program, which permits broad-based indexes to list standard 
options trading to expire on any Monday, Tuesday, Wednesday, Thursday, 
or Friday (other than the third Friday-of-the-month or days that 
coincide with an EOM expiration). Weekly Expirations would be subject 
to all provisions of Rule 4.13 and would be treated the same as options 
on the same underlying index that expire on the third Friday of the 
expiration month. New series in Weekly Expirations could be added up to 
and including on the expiration date for an expiring Weekly Expiration. 
The maximum number of expirations that could 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 would be the same as the maximum number of expirations 
permitted for standard options on the same broad-based index.\25\ 
Further, the Exchange could open for trading EOMs on any broad-based 
index eligible for standard options trading to expire on last trading 
day of the month. EOMs would be 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. However, the EOMs 
would be P.M.-settled and new series in EOMs could be added up to and 
including on the expiration date for an expiring EOM.\26\ Today, XND 
options on Phlx \27\ and ISE \28\ are part of the Nonstandard Program 
of each of those exchanges.
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    \25\ Weekly Expirations need not be for consecutive Monday, 
Tuesday, Wednesday, Thursday, or Friday expirations as applicable; 
however, the expiration date of a non-consecutive expiration may not 
be beyond what would be considered the last expiration date if the 
maximum number of expirations were listed consecutively. Weekly 
Expirations that are first listed in a given class may expire up to 
four weeks from the actual listing date. If the Exchange lists EOMs 
and Weekly Expirations as applicable in a given class, the Exchange 
will list an EOM instead of a Weekly Expiration that expires on the 
same day in the given class. Other expirations in the same class are 
not counted as part of the maximum number of Weekly Expirations for 
an applicable broad-based index class. If the Exchange is not open 
for business on a respective Monday, the normally Monday expiring 
Weekly Expirations will expire on the following business day. If the 
Exchange is not open for business on a respective Tuesday, 
Wednesday, Thursday, or Friday, the normally Tuesday, Wednesday, 
Thursday, or Friday expiring Weekly Expirations will expire on the 
previous business day. If two different Weekly Expirations would 
expire on the same day because the Exchange is not open for business 
on a certain weekday, the Exchange will list only one of such Weekly 
Expirations. See Rule 4.13(e)(1).
    \26\ The maximum number of expirations that may be listed for 
EOMs 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. EOM expirations need not be for consecutive 
end of month expirations; however, the expiration date of a non-
consecutive expiration may not be beyond what would be considered 
the last expiration date if the maximum number of expirations were 
listed consecutively. EOMs that are first listed in a given class 
may expire up to four weeks from the actual listing date. Other 
expirations in the same class are not counted as part of the maximum 
numbers of EOM expirations for a broad-based index class. See Rule 
4.13(e)(2).
    \27\ See Phlx Options 4A, Section 12(b)(5).
    \28\ See ISE Rules, Options 4A, Section 12, Supplementary 
Material .07.
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    Generally, pursuant to Rule 4.13, Interpretation and Policy .01, 
except as provided in Rule 4.13, Interpretation

[[Page 78953]]

and Policy .01(h), the exercise (strike) price intervals will be no 
less than $5, provided that, in the case of certain classes of index 
options noted in Rule 4.13, Interpretation and Policy .01(a), the 
Exchange may determine to list strike prices at no less than $2.50 
intervals. The Exchange proposes to amend Rule 4.13, Interpretation and 
Policy .01(a) add XND options to the list of classes where strike price 
intervals of no less than $2.50 are generally permitted and note, ``if 
the strike price is less than $200.'' \29\ Further, the Exchange 
proposes to amend Rule 4.13, Interpretation and Policy .01(h) which 
currently provides that the Exchange may also list series at $1 strike 
intervals for Mini-Nasdaq-100 Index (``MNX'' or ``Mini-NDX''). 
Specifically, the Exchange proposes to amend Rule 4.13, Interpretation 
and Policy .01(h) to adopt the same strike price intervals for XND 
options as are listed for XND options on ISE \30\ and currently 
approved for MNX options within Rule 4.13, Interpretation and Policy 
.01(h). Thus, notwithstanding 4.13, Interpretation and Policy .01(a), 
the interval between strike prices of series of XND options may be $1 
(or greater), subject to the conditions described in Rule 4.13, 
Interpretation and Policy .01(h). The Exchange will not list LEAPS on 
XND options at intervals less than $2.50. If the Exchange determines to 
add XND options to the Weeklies or Quarterlies programs such options 
will be listed with expirations and strike prices described in Rule 
4.13, Interpretation and Policy .01(h).
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    \29\ Reduced-value Nasdaq 100 Index options are currently 
included in the list of classes where strike price intervals of no 
less than $2.50 are generally permitted. As part of the proposed 
changes, the Exchange also proposes to add the same ``if the strike 
price is less than $200'' language to the Reduced-value Nasdaq 100 
Index, as this language was inadvertently omitted.
    \30\ See ISE Rules, Options 4A, Section 12(c)(5).
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Position and Exercise Limits; Margin
    The Exchange proposes to amend Rule 8.31(a). As with NDX, in 
determining compliance with Rule 8.31 (Position Limits for Broad-Based 
Index Options), there will be no position limits for broad-based index 
option contracts in the XND class.\31\ Since the Exchange is proposing 
to list a micro index contract that is based on 1/100 of the value of 
the Nasdaq-100 Index, Rule 8.31(f) would apply. The Exchange proposes 
to apply broad-based index margin requirements for the purchase and 
sale of XND options that are the same as margin requirements currently 
in place for NDX options.
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    \31\ See proposed changes to Rule 8.31(a).
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    Further, the Exchange proposes to amend Rule 8.35(b) to add XND to 
the list of broad-based FLEX index options for which there are no 
position limits.
    In addition, there would be no exercise limits for XND. As such, 
the Exchange proposes to amend Rule 8.42(b) to include XND in the list 
of broad-based index options for which there are no exercise limits and 
Rule 8.42(g) to include XND in the list broad-based FLEX index options 
for which there are no exercise limits. The same rules for position and 
exercise limits to XND options on ISE.\32\
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    \32\ See ISE Rules, Options 4A, Section 6 (Position Limits) and 
Section 10 (Exercise Limits).
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Surveillance and Capacity
    The Exchange represents that it has sufficient capacity to handle 
additional quotations and message traffic associated with the proposed 
listing and trading of XND options. Further, the Exchange has analyzed 
its capacity and represents that it believes the Exchange and the 
Options Price Reporting Authority (``OPRA'') have the necessary systems 
capacity to handle any additional traffic associated with the listing 
of the maximum number nonstandard expirations permitted pursuant to 
Rule 4.13(e).
    Index options are integrated into the Exchange's existing 
surveillance system architecture, as well as the Financial Industry 
Regulatory Authority's (FINRA'') (which performs certain regulatory 
services for the Exchange pursuant to a regulatory services agreement), 
and are thus subject to the relevant surveillance processes. The 
Exchange represents that it has adequate surveillance procedures to 
monitor trading in XND options thereby aiding in the maintenance of a 
fair and orderly market.
    The Exchange notes that it is amending Rule 4.13 to include the 
Nasdaq 100 Micro Index Options within the Rule to conform to the 
amendments proposed herein.
2. Statutory Basis
    The Exchange believes 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.\33\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \34\ 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 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) \35\ requirement that the rules of an exchange not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
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    \33\ 15 U.S.C. 78f(b).
    \34\ 15 U.S.C. 78f(b)(5).
    \35\ Id.
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    The Exchange believes that the proposed rule change will further 
the Exchange's goal of introducing new and innovative products to the 
marketplace. Specifically, the Exchange believes that XND options would 
provide additional opportunities for market participants to trade and 
hedge exposure to the Nasdaq-100 Index as it does today on ISE and 
Phlx. The proposed XND options product is identical to XND options on 
ISE and Phlx. Additionally, the proposed XND options product is similar 
to NDX options that are currently permitted to be listed and traded on 
the Exchange with two important differences: (1) XND options will be 
based on 1/100 the value of the Nasdaq-100 Index, and (2) XND options 
will be P.M.-settled (in addition to being A.M.-settled). These 
differences are based on the Exchanges experience listing NDX options 
and are designed to attract additional participation from retail and 
other investors.
    The Exchange believes that the proposed contract specifications 
will be attractive to market participants and will remove impediments 
to and perfect the mechanism of a free and open market and a national 
market system. The nonstandard expirations would expand the ability of 
investors to hedge risks against market movements stemming from 
economic releases or market events that occur during the month and at 
the end of the month. Accordingly, the Exchange believes that weekly 
expirations and EOMs should create greater trading and hedging 
opportunities and flexibility, and provide customers with the ability 
to tailor their investment objectives more closely.
    The Exchange believes that a micro index option would allow 
additional participation from investors. Specifically, the Exchange 
believes that basing the contract on a micro value of the Nasdaq-100 
Index will encourage

[[Page 78954]]

additional participation by retail and other investors due to the 
reduced capital outlay needed to trade these options.
    XND options will be subject to the same rules that presently govern 
the trading of index options based on the Nasdaq-100 Index, including 
sales practice rules, margin requirements, trading rules, and position 
and exercise limits. The Exchange therefore believes that the rules 
applicable to trading in XND options are consistent with the protection 
of investors and the public interest. Furthermore, the Exchange 
represents that it has sufficient systems capacity and adequate 
surveillance procedures to handle trading in XND options.
    With respect to the Exchange's proposal to provide that minimum 
increments for bids and offers for XND options be the same as those for 
QQQ, regardless of the value at which the option series is quoted, may 
promote competition and benefit investors. This proposal aligns the 
minimum increments for XND options with those for QQQ options in order 
to allow market participants to quote in minimum increments of $0.01 is 
consistent with the Act because allowing participants to quote in 
smaller increments may provide the opportunity for reduced spreads, 
thereby lowering costs to investors. In addition, because both XND and 
QQQ are based on the Nasdaq-100 Index it would be reasonable for the 
minimum increments of bids and offers to be the same for both types of 
options.

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. XND options would be 
available for trading to all market participants. The proposed rule 
change will facilitate the listing and trading of a new option product 
that will enhance competition among market participants, to the benefit 
of investors and the marketplace. The listing of XND will enhance 
competition by providing investors with an additional investment 
vehicle, in a fully-electronic trading environment, through which 
investors can gain and hedge exposure to the Nasdaq-100 Index. 
Furthermore, this product could offer a competitive alternative to 
other existing investment products that seek to allow investors to gain 
broad market exposure. Finally, two other exchanges currently list the 
same product for trading in accordance with substantially similar 
rules.

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 \36\ and Rule 19b-4(f)(6) thereunder.\37\ 
Because the 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 prior to 
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, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act \38\ and Rule 19b-
4(f)(6)(iii) thereunder.\39\
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    \36\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \37\ 17 CFR 240.19b-4(f)(6).
    \38\ 15 U.S.C. 78s(b)(3)(A).
    \39\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's 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 under Rule 19b-4(f)(6) \40\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\41\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative immediately upon filing. As discussed above, the 
Exchange states that this proposed rule change is substantially similar 
to a proposal submitted by Phlx \42\ that was previously approved by 
the Commission, as well as a proposal submitted by ISE \43\ that was 
subject to Commission review. The Exchange also stated that the two 
other exchanges currently list the same product for trading in 
accordance with substantially similar rules. The Exchange believes that 
the waiver of the operative delay will protect investors by allowing 
the Exchange to implement the proposal expeditiously, and it will 
promote competition by providing an additional venue upon which to 
trade this product. The Commission believes that waiver of the 
operative delay is consistent with the protection of investors and the 
public interest because it will permit the Exchange to remain 
competitive with other exchanges and provide immediate choice to market 
participants to readily direct order flow to competing venues who offer 
similar functionality. Accordingly, the Commission hereby waives the 
30-day operative delay and designates the proposal operative upon 
filing.\44\
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    \40\ 17 CFR 240.19b-4(f)(6).
    \41\ 17 CFR 240.19b-4(f)(6)(iii).
    \42\ See Securities Exchange Act Release No. 98451 (September 
20, 2023), 88 FR 66088 (September 26, 2023) (SR-Phlx-2023-07) (Order 
Granting Approval of a Proposed Rule Change, as Modified by 
Amendment No. 1, To Make Permanent Certain P.M.-Settled Pilots).
    \43\ See Securities Exchange Act Release No. 98886 (November 8, 
2023), 88 FR 78417 (November 15, 2023) (SR-ISE-2023-24) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Permit 
the Listing and Trading of XND Options).
    \44\ For 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).
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    At any time within 60 days of the filing of this 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 under 
Section 19(b)(2)(B) \45\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \45\ 15 U.S.C. 78s(b)(2)(B).
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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

    <bullet> Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#295b5c454c044a4644444c475d5a695a4c4a074e465f"><span class="__cf_email__" data-cfemail="9ae8eff6ffb7f9f5f7f7fff4eee9dae9fff9b4fdf5ec">[email protected]</span></a>. Please include 
file number SR-CBOE-2024-043 on the subject line.

Paper Comments

    <bullet> Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.


[[Page 78955]]


All submissions should refer to file number SR-CBOE-2024-043. 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-CBOE-2024-043 and should be 
submitted on or before October 17, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\46\
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    \46\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2024-22026 Filed 9-25-24; 8:45 am]
BILLING CODE 8011-01-P


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