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[Federal Register Volume 89, Number 232 (Tuesday, December 3, 2024)]
[Notices]
[Pages 95865-95867]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-28344]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101776; File No. SR-Phlx-2024-63]

Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Remove Rules 
Related to the Nasdaq-100[supreg] Volatility Index

November 27, 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 November 21, 2024, Nasdaq PHLX LLC (``Phlx'' or ``Exchange'') filed 
with the Securities and Exchange Commission (``Commission'') a proposed 
rule change as described in Items I, II, and III below, which Items 
have been prepared by the Exchange. The Commission is publishing this 
notice to solicit

[[Page 95866]]

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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to remove rule text related to the listing of 
options on the Nasdaq-100[supreg] Volatility Index.
    The text of the proposed rule change is available on the Exchange's 
website at https://listingcenter.nasdaq.com/rulebook/phlx/rules, 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 Exchange proposes to amend various rules to remove references 
to the listing of options on the Nasdaq-100[supreg] Volatility 
Index.\3\
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    \3\ VOLQ is a proprietary index product. The VOLQ options index 
product measured ``at-the-money'' volatility, a precise measure of 
volatility used by investors. Specifically, VOLQ options measured 
changes in 30-day implied volatility of the Nasdaq-100 Index 
(commonly known as and referred to by its ticker symbol, NDX).
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    In 2021, Phlx received approval \4\ to list and trade options on 
VOLQ. Phlx subsequently received approval \5\ to amend the calculation 
of its final settlement price for options on VOLQ. Phlx launched VOLQ 
options on June 14, 2022.\6\ On May 18, 2023, Phlx delisted options on 
VOLQ and the Exchange does not have plans to re-list VOLQ options in 
the foreseeable future. There is no open interest in VOLQ at this time. 
The Exchange proposes to delete all references to VOLQ options to 
provide greater clarity to members and member organizations and the 
public regarding the Exchange's offerings and Rulebook.
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    \4\ See Securities Exchange Act Release No. 91781 (May 5, 2021), 
86 FR 25918 (May 11, 2021) (SR-Phlx-2020-41) (Notice of Filing of 
Amendment Nos. 1 and 2 and Order Granting Accelerated Approval of a 
Proposed Rule Change, as Modified by Amendment Nos. 1 and 2, To List 
and Trade Options on a Nasdaq-100 Volatility Index) (``VOLQ Options 
Approval Order'').
    \5\ See Securities Exchange Act Release No. 93628 (November 19, 
2021), 86 FR 67555 (November 26, 2021) (SR-Phlx-2021-56) (Order 
Approving a Proposed Rule Change To Amend Options 4A, Section 12 
Regarding the Calculation of the Closing Volume Weighted Average 
Price for Options on the Nasdaq-100 Volatility Index in Certain 
Circumstances) (``Amendment to VOLQ Options'').
    \6\ See Options Trader Alert #2022-16 (http://www.nasdaqtrader.com/MicroNews.aspx?id=OTA 2022-16).
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    Specifically, the Exchange proposes to delete references to the 
Nasdaq-100 [supreg] Volatility Index or ``VOLQ'' in Options 3, Section 
1, Hours of Business; and Options 4A Rules at: Section 2, Definitions; 
\7\ Section 6, Position Limits; and Section 12, Terms of Index Options 
Contracts. The Exchange also proposes to remove pricing in Options 7, 
Pricing Schedule, at Section 5, Index and Singly Listed Options 
(Includes options overlying FX Options, equities, ETFs, ETNs, and 
indexes not listed on another exchange).
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    \7\ The Exchange proposes to remove a stray period after the 
title ``Definitions.''
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\8\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\9\ in particular, in that it is designed 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.
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    \8\ 15 U.S.C. 78f(b)
    \9\ 15 U.S.C. 78f(b)(5).
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    Phlx's proposal to remove references to the Nasdaq-100 [supreg] 
Volatility Index or ``VOLQ'' in Phlx Rules is consistent with the Act 
as Phlx delisted options on VOLQ in 2023 and there is no open interest 
in VOLQ options at this time. Further, the Exchange does not have plans 
to re-list VOLQ options in the foreseeable future. The Exchange 
proposes to delete all references to VOLQ options to provide greater 
clarity to members and member organizations and the public regarding 
the Exchange's offerings and Rulebook.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act.
    The Exchange's proposal to remove references to the Nasdaq-100 
[supreg] Volatility Index or ``VOLQ'' in Phlx Rules does not impose an 
undue burden on intra-market competition as, today, no member or member 
organization is able to options on VOLQ or will be able to trade 
options on VOLQ in the future.
    The Exchange's proposal to remove references to the Nasdaq-100 
[supreg] Volatility Index or ``VOLQ'' in Phlx Rules does not impose an 
undue burden on inter-market competition as VOLQ options was a 
proprietary product of Nasdaq, Inc. and singly listed on Phlx. Other 
options markets can develop a similar index options product on their 
market.

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 foregoing proposed rule change does not: (i) 
significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \10\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\11\
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    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \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.
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    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:

[[Page 95867]]

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-Phlx-2024-63 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-Phlx-2024-63. 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-Phlx-2024-63 and should be 
submitted on or before December 24, 2024.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Stephanie J. Fouse,
Assistant Secretary.
[FR Doc. 2024-28344 Filed 12-2-24; 8:45 am]
BILLING CODE 8011-01-P
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