5600 Federal Register / Vol. 80, No. 21 / Monday, February 2, 2015 / Notices 

18 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3STOs, also known as ‘‘weekly options’’ as well 

as ‘‘Short Term Options’’, are series in an options 

class that are approved for listing and trading on the 

Exchange in which the series are opened for trading 

on any Thursday or Friday that is a business day 

and that expire on the Friday of the next business 

week. If a Thursday or Friday is not a business day, 

the series may be opened (or shall expire) on the 

first business day immediately prior to that 

Thursday or Friday, respectively. STOs are listed 

and traded pursuant to the STO Series Program. For 

STO Series Program rules regarding non-index 

options, see Rule 1000(b)(44) and Commentary .11 

to Rule 1012. For STO Series Program rules 

regarding index options, see Rule 1000A(b)(16) and 

Rule 1101A(b)(vi). 

4See Securities Exchange Act Release No. 73999 

(January 6, 2015), 80 FR 1559 (January 12, 2015) 

(SR–ISE–2014–52) (order approving). 

5See Commentary .11(a) to Rule 1012. 

6See Commentary .11 to Rule 1012. 

7See Commentary .11(e) to Rule 1012. 

8 Id. 

9See Commentary .05(b) to Rule 1012. 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549–1090. 

All submissions should refer to File No. 

SR–BYX–2015–06. 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 

10:00 a.m. and 3:00 p.m. Copies of such 

filing will also 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 No. 

SR–BYX–2015–06 and should be 

submitted on or before February 23, 

2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2015–01868 Filed 1–30–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74145; File No. SR–Phlx– 

2015–09] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX LLC; Notice of 

Filing and Immediate Effectiveness of 

a Proposed Rule Change Regarding 

the Short Term Option Series Program 

January 27, 2015. 

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 January 

21, 2015, NASDAQ OMX PHLX LLC 

(‘‘Phlx’’ 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 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 is filing with the 

Commission a proposal to amend Rule 

1012 (Series of Options Open for 

Trading) to introduce finer $.50 strike 

price intervals in non-index Short Term 

Options with strike prices less than 

$100. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://nasdaqomxphlx.cchwall

street.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 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 Rule 1012 governing 

the Short Term Option (‘‘STO’’) 3 Series 

Program to introduce finer strike price 

intervals for certain STOs. In particular, 

the Exchange proposes to amend 

Commentary .11(e) to Rule 1012 to 

extend $0.50 strike price intervals in 

non-index options to STOs with strike 

prices less than $100 instead of the 

current $75. This proposed change is 

intended to eliminate gapped strikes 

between $75 and $100 that result from 

conflicting strike price parameters 

under the STO Series Program and the 

$2.50 Strike Price Program, as described 

in more detail below. 

This is a competitive filing that is 

based on a recent STO proposal of the 

International Securities Exchange, LLC 

(‘‘ISE’’).4

Under the Exchange’s rules, the 

Exchange may list STOs in up to fifty 

option classes in addition to option 

classes that are selected by other 

securities exchanges that employ a 

similar program under their respective 

rules.5 On any Thursday or Friday that 

is a business day, the Exchange may list 

STO series in designated option classes 

that expire at the close of business on 

each of the next five Fridays that are 

business days and are not Fridays in 

which monthly or quarterly options 

expire.6 These STO series trade in 

$0.50, $1, or $2.50 or greater strike price 

intervals depending on the strike price 

and whether the option trades in dollar 

increments in the related monthly 

expiration.7 Specifically, STOs in nonindex option classes admitted to the 

STO Series Program currently trade in: 

(1) $0.50 or greater intervals for strike 

prices less than $75, or for option 

classes that trade in one dollar 

increments in the related monthly 

expiration option; (2) $1 or greater 

intervals for strike prices that are 

between $75 and $150; and (3) $2.50 or 

greater intervals for strike prices above 

$150.8

The Exchange also operates a $2.50 

Strike Price Program that permits the 

Exchange to select up to sixty options 

classes on individual stocks to trade in 

$2.50 strike price intervals, in addition 

to option classes selected by other 

securities exchanges that employ a 

similar program under their respective 

rules.9 Monthly expiration options in 

classes admitted to the $2.50 Strike 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 80, No. 21 / Monday, February 2, 2015 / Notices 5601 

10 Id. For a definition of ‘‘primary market’’, see 

Rule 1000(b)31. 

11 15 U.S.C. 78f(b). 

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

13See Commentary .05(a)(vii) to Rule 1012. 

14 15 U.S.C. 78s(b)(3)(A). 

15 17 CFR 240.19b–4(f)(6). As required under Rule 

19b–4(f)(6)(iii), the Exchange provided the 

Commission with written notice of its intent to file 

the proposed rule change, along with a brief 

description and the 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. 

16For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

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

Price Program trade in $2.50 intervals 

where the strike price is (1) greater than 

$25 but less than $50; or (2) between 

$50 and $100 if the strikes are no more 

than $10 from the closing price of the 

underlying stock in its primary market 

on the preceding day.10 These strike 

price parameters conflict with strike 

prices allowed for STOs as dollar strikes 

between $75 and $100 otherwise 

allowed under the STO Series Program 

may be within $0.50 of strikes listed 

pursuant to the $2.50 Strike Price 

Program. In order to remedy this 

conflict, the Exchange proposes to 

extend the $0.50 strike price intervals 

currently allowed for STOs with strike 

prices less than $75 to STOs with strike 

prices less than $100. 

With this proposed change, STOs in 

non-index option classes will trade in: 

(1) $0.50 or greater intervals for strike 

prices less than $100, or for option 

classes that trade in one dollar 

increments in the related monthly 

expiration option; (2) $1 or greater 

intervals for strike prices that are 

between $100 and $150; and (3) $2.50 

or greater intervals for strike prices 

above $150. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 

and the rules and regulations 

thereunder, including the requirements 

of Section 6(b) of the Act.11 In 

particular, the Exchange believes the 

proposed rule change is consistent with 

the Section 6(b)(5) 12 requirements that 

the rules of an exchange be designed to 

promote just and equitable principles of 

trade, to prevent fraudulent and 

manipulative acts, to foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities, 

to remove impediments to and to perfect 

the mechanism for a free and open 

market and a national market system, 

and, in general, to protect investors and 

the public interest. 

During the month prior to expiration, 

the Exchange is permitted to list related 

monthly option contracts in the 

narrower strike price intervals available 

for STO series.13 After transitioning to 

short term strike price intervals, 

however, monthly options that trade in 

$2.50 intervals between $50 and $100 

under the $2.50 Strike Price Program, 

trade with dollar strikes between $75 

and $150. Due to the overlap of $1 and 

$2.50 intervals, the Exchange cannot list 

certain dollar strikes between $75 and 

$100 that conflict with the prior $2.50 

strikes. For example, if the Exchange 

initially listed monthly options on ABC 

with $75, $77.50, and $80 strikes, the 

Exchange could list the $76 and $79 

strikes when these transition to short 

term intervals. The Exchange would not 

be permitted to list the $77 and $78 

strikes, however, as these are $0.50 

away from the $77.50 strike already 

listed on the Exchange. This creates 

gapped strikes between $75 and $100, 

where investors are not able to trade 

otherwise allowable dollar strikes on the 

Exchange. Similarly, these conflicting 

strike price parameters create issues for 

investors who want to roll their 

positions from monthly to weekly 

expirations. In the example above, for 

instance, an investor that purchased a 

monthly ABC option with a $77.50 

strike price would not be able to roll 

that position into a later short term 

expiration with the same strike price as 

that strike is unavailable under current 

STO Series Program rules. Permitting 

$0.50 intervals for STOs up to $100 

would remedy both of these issues as 

strikes allowed under the $2.50 Strike 

Price Program would not conflict with 

the finer $0.50 strike price interval. 

The STO Series Program has been 

well-received by market participants 

and the Exchange believes that 

introducing finer strike price intervals 

for STOs with strike prices between $75 

and $100, and thereby eliminating the 

gapped strikes described above, will 

benefit these market participants by 

giving them more flexibility to closely 

tailor their investment and hedging 

decisions. 

With regard to the impact of this 

proposal on system capacity, the 

Exchange has analyzed its capacity and 

represents that it and the Options Price 

Reporting Authority (‘‘OPRA’’) have the 

necessary systems capacity to handle 

any potential additional traffic 

associated with this proposed rule 

change. The Exchange believes that its 

members will not have a capacity issue 

as a result of this proposal. The 

Exchange also represents that it does not 

believe this expansion will cause 

fragmentation of liquidity. 

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. To the 

contrary, the Exchange believes that the 

proposed rule change will result in 

additional investment options and 

opportunities to achieve the investment 

objectives of market participants seeking 

efficient trading and hedging vehicles, 

to the benefit of investors, market 

participants, and the marketplace in 

general. 

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 

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 for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, the 

proposed rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 14 and Rule 19b–4(f)(6) 

thereunder.15

The Exchange has asked the 

Commission to waive the 30-day 

operative delay so that the proposal may 

become operative immediately upon 

filing. The Exchange stated that waiver 

of this requirement will ensure fair 

competition among exchanges by 

allowing the Exchange to open 

additional series of individual stocks 

and ETF options in $.50 strike price 

intervals up to $100 in the same manner 

as ISE. For this reason, the Commission 

believes that the proposed rule change 

presents no novel issues and that waiver 

of the 30-day operative delay is 

consistent with the protection of 

investors and the public interest; and 

will allow the Exchange to remain 

competitive with other exchanges. 

Therefore, the Commission designates 

the proposed rule change to be operative 

upon filing.16

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 

mstockstill on DSK4VPTVN1PROD with NOTICES

5602 Federal Register / Vol. 80, No. 21 / Monday, February 2, 2015 / Notices 

17 17 CFR 200.30–3(a)(12). 

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). 

5See Securities Exchange Act Release No. 73999 

(January 6, 2015), 80 FR 1559 (January 12, 2015) 

(Order Granting Approval of Proposed Rule Change 

Regarding the Short Term Option Series Program) 

(SR–ISE–2014–52). 

6See Rule 5.5(d)(1). 

7See Rule 5.5(d). 

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–2015–09 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–Phlx–2015–09. 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 

10:00 a.m. and 3:00 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– 

2015–09 and should be submitted on or 

before February 23, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2015–01863 Filed 1–30–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74144; File No. SR–CBOE– 

2015–009] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Regarding the Short 

Term Option Series Program 

January 27, 2015. 

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 January 

21, 2015, Chicago Board Options 

Exchange, Incorporated (the ‘‘Exchange’’ 

or ‘‘CBOE’’) 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 Exchange. The Exchange filed the 

proposal as a ‘‘non-controversial’’ 

proposed rule change pursuant to 

Section 19(b)(3)(A)(iii) of the Act 3 and 

Rule 19b–4(f)(6) thereunder.4 The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

CBOE proposes to amend Rule 5.5(d) 

(Short Term Option Series Program) to 

extend current $0.50 strike price 

intervals in non-index options to short 

term options with strike prices less than 

$100. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

(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 Exchange proposes to amend its 

rules governing the Short Term Option 

Series Program to introduce finer strike 

price intervals for certain short term 

options. In particular, the Exchange 

proposes to amend Rule 5.5(d) to extend 

$0.50 strike price intervals in non-index 

options to short term options with strike 

prices less than $100 instead of the 

current $75. This proposed change is 

intended to eliminate gapped strikes 

between $75 and $100 that result from 

conflicting strike price parameters 

under the Short Term Option Series and 

$2.50 Strike Price Programs as described 

in more detail below. This is a 

competitive filing that is based on a 

recently approved filing by the 

International Securities Exchange, LLC 

(‘‘ISE’’).5

Under CBOE’s rules, the Exchange 

may list short term options in up to fifty 

option classes in addition to option 

classes that are selected by other 

securities exchanges that employ a 

similar program under their respective 

rules.6 On any Thursday or Friday that 

is a business day, the Exchange may list 

short term option series in designated 

option classes that expire at the close of 

business on each of the next five Fridays 

that are business days and are not 

Fridays in which monthly or quarterly 

options expire.7 These short term option 

series trade in $0.50, $1, or $2.50 strike 

price intervals depending on the strike 

price and whether the option trades in 

dollar increments in the related monthly 

mstockstill on DSK4VPTVN1PROD with NOTICES