Document ID: SEC-2019-1515-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Cboe Exchange, Inc.
Posted Date: 2019-10-17T04:00Z

[Federal Register Volume 84, Number 201 (Thursday, October 17, 2019)]
[Notices]
[Pages 55671-55675]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-22591]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87273; File No. SR-CBOE-2019-091]

Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
the Name of a Reporting Authority for Certain Indexes on Which the 
Exchange May List Options

October 10, 2019.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on October 3, 2019, Cboe Exchange, Inc. (the ``Exchange'' or 
``Cboe Options'') 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.
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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

    The Exchange proposes to amend the name of a reporting authority 
for certain indexes on which the Exchange may list options. The text of 
the proposed rule change is provided below.

[[Page 55672]]

 
 
 
          (additions are italicized; deletions are [bracketed])
                                * * * * *
                      Rules of Cboe Exchange, Inc.
                                * * * * *
Rule 24.1. Definitions
No change.
. . . Interpretations and Policies:
.01 The reporting authorities designated by the Exchange in respect of
 each index underlying an index option contract traded on the Exchange
 are as follows:
Index                                    Reporting Authority
S&P 100................................  Standard & Poor's.
S&P 500................................  Standard & Poor's.
Cboe Bio Tech..........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
FTSE 100 Index (1/10th)................  FTSE International Limited.
FT-SE 200 Eurotrack....................  London Stock Exchange.
Russell 2000...........................  Frank Russell Co.
S&P Transportation.....................  Standard & Poor's.
S&P Retail.............................  Standard & Poor's.
S&P Health Care........................  Standard & Poor's.
S&P Entertainment & Leisure............  Standard & Poor's.
S&P Banking............................  Standard & Poor's.
S&P Insurance..........................  Standard & Poor's.
S&P Chemical...........................  Standard & Poor's.
Cboe Options Software..................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Environmental.............  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
S&P 500/Barra Growth...................  Standard & Poor's.
S&P 500/Barra Value....................  Standard & Poor's.
Nasdaq 100.............................  Nasdaq, Inc.
Cboe Options Gaming....................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Global Telecommunications.  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Mexico....................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Israeli...................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe REIT Index........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Nikkei Stock Index 300.................  Nihon Keizai Shimbun, Inc.
Cboe Options Emerging Asian Markets....  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Emerging Markets..........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
S&P SmallCap 600 Index.................  Standard & Poor's.
Cboe Options Latin 15..................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Technology Index..................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Germany 25 Index..................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Mexico 30 Index........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Options Automotive................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Internet Index....................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Oil Index.........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Gold Index........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Computer Networking Index.........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PC Index..........................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
IPC....................................  Mexican Stock Exchange.
GSTI Composite Index...................  Goldman, Sachs & Co.
GSTI Internet Index....................  Goldman, Sachs & Co.
GSTI Software Index....................  Goldman, Sachs & Co.
GSTI Semiconductor Index...............  Goldman, Sachs & Co.
GSTI Hardware Index....................  Goldman, Sachs & Co.
GSTI Multimedia Networking Index.......  Goldman, Sachs & Co.
GSTI Services Index....................  Goldman, Sachs & Co.
Morgan Stanley Multinational Company     Morgan Stanley.
 Index.
Reduced Value NYSE Composite Index.....  Dow Jones & Company, Inc.
Dow Jones Industrial Average...........  Dow Jones & Company, Inc.
Dow Jones Transportation Average.......  Dow Jones & Company, Inc.
Dow Jones Utility Average..............  Dow Jones & Company, Inc.
Lipper Analytical/Salomon Bros. Growth   Lipper Analytical Services,
 Fund Index.                              Inc.
Lipper Analytical/Salomon Bros. Growth   Lipper Analytical Services,
 & Income Fund Index.                     Inc.
Dow Jones High Yield Select 10 Index...  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Dow Jones Equity REIT Index............  Dow Jones & Company, Inc.
Dow Jones E*Commerce Index.............  Dow Jones & Company, Inc.
Cboe Euro 25 Index.....................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Asian 25 Index....................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Russell 1000 Index.....................  Frank Russell Co.

[[Page 55673]]

 
Russell 1000 Growth Index..............  Frank Russell Co.
Russell 1000 Value Index...............  Frank Russell Co.
Russell 2000 Growth Index..............  Frank Russell Co.
Russell 2000 Value Index...............  Frank Russell Co.
Russell 3000 Index.....................  Frank Russell Co.
Russell 3000 Growth Index..............  Frank Russell Co.
Russell 3000 Value Index...............  Frank Russell Co.
Russell Midcap Index...................  Frank Russell Co.
Russell Midcap Growth Index............  Frank Russell Co.
Russell Midcap Value Index.............  Frank Russell Co.
Russell Top 200 Index..................  Frank Russell Co.
Russell Top 200 Growth Index...........  Frank Russell Co.
Russell Top 200 Value Index............  Frank Russell Co.
Cboe China Index.......................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Volatility Index[supreg]            Cboe [Exchange, Inc.]Global
 (VIX[supreg]).                           Indices, LLC.
Cboe Nasdaq 100[supreg] Volatility       Cboe [Exchange, Inc.]Global
 Index (VXN[supreg]).                     Indices, LLC.
Cboe Dow Jones Industrial                Cboe [Exchange, Inc.]Global
 Average[supreg] Volatility Index         Indices, LLC.
 (VXD[supreg]).
Cboe Increased-Value Volatility          Cboe [Exchange, Inc.]Global
 Index[supreg].                           Indices, LLC.
Cboe Increased-Value Nasdaq 100[supreg]  Cboe [Exchange, Inc.]Global
 Volatility Index.                        Indices, LLC.
Cboe Increased-Value Dow Jones           Cboe [Exchange, Inc.]Global
 Industrial Average[supreg] Volatility    Indices, LLC.
 Index.
Cboe PowerPacksSM Bank Index...........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Biotechnology Index..  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Gold Index...........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Internet Index.......  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Iron & Steel Index...  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Oil Index............  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Oil Services Index...  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Pharmaceuticals Index  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Retail Index.........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Semiconductor Index..  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Technology Index.....  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe PowerPacksSM Telecom Index........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Russell 2000 Volatility IndexSM     Cboe [Exchange, Inc.]Global
 (``RVXSM'').                             Indices, LLC.
Cboe S&P 500 Three-Month Realized        Cboe [Exchange, Inc.]Global
 Variance.                                Indices, LLC.
Cboe S&P 500 Three-Month Realized        Cboe [Exchange, Inc.]Global
 Volatility.                              Indices, LLC.
Cboe S&P 500 BuyWrite Index (1/10th      Cboe [Exchange, Inc.]Global
 value).                                  Indices, LLC.
S&P 500 Dividend Index.................  Standard & Poor's .01.
Cboe Gold ETF Volatility Index.........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Equity VIX on Apple...............  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Equity VIX on Amazon..............  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Equity VIX on Goldman Sachs.......  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Equity VIX on Google..............  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Equity VIX on IBM.................  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Crude Oil ETF Volatility Index....  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Emerging Markets ETF Volatility     Cboe [Exchange, Inc.]Global
 Index.                                   Indices, LLC.
Cboe China ETF Volatility Index........  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Brazil ETF Volatility Index.......  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Gold Miners ETF Volatility Index..  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Energy Sector ETF Volatility Index  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe Silver ETF Volatility Index.......  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
Cboe S&P 500 AM/PM Basis...............  Cboe [Options] Global Indices,
                                          LLC.
Cboe Short-Term Volatility Index.......  Cboe [Exchange, Inc.]Global
                                          Indices, LLC.
MSCI EAFE Index (EAFE).................  MSCI Inc.
MSCI Emerging Markets Index (EM).......  MSCI Inc.
FTSE China 50 Index (1/100th)..........  FTSE International Limited.
FTSE Emerging Index....................  FTSE International Limited.
FTSE Developed Europe Index............  FTSE International Limited.
S&P Financial Select Sector Index (IXM)  S&P Dow Jones Indices.
S&P Energy Select Sector Index (IXE)...  S&P Dow Jones Indices.
S&P Technology Select Sector Index       S&P Dow Jones Indices.
 (IXT).
S&P Health Care Select Sector Index      S&P Dow Jones Indices.
 (IXV).
S&P Utilities Select Sector Index (IXU)  S&P Dow Jones Indices.
S&P Consumer Staples Select Sector       S&P Dow Jones Indices.
 Index (IXR).
S&P Industrials Select Sector Index      S&P Dow Jones Indices.
 (IXI).
S&P Consumer Discretionary Select        S&P Dow Jones Indices.
 Sector Index (IXY).
S&P Materials Select Sector Index (IXB)  S&P Dow Jones Indices.
S&P Real Estate Select Sector Index      S&P Dow Jones Indices.
 (IXRE).
S&P Communication Services Select        S&P Dow Jones Indices.
 Sector Index (IXC).

[[Page 55674]]

 
                                * * * * *
 

    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
    Cboe Options currently operates a business, separate from its 
operation of an options exchange, in which it creates, administers, and 
distributes proprietary financial and benchmarks, calculates index 
values and benchmarks for third-party customers, and calculates and 
licenses indexes for third-party derivative indexes and products, among 
other things. Cboe Options calculates and disseminates the values of 
these indexes to market participants. Pursuant to the Cboe Options 
Rules, the Exchange is also authorized to list options on certain of 
these indexes, for which Cboe Options acts as the reporting 
authority.\5\ The reporting authority in respect of a particular index 
means the institution or reporting service designated by the Exchange 
as the official source for calculating the level of the index from the 
reporting prices of the underlying securities that are the basis of the 
index and reporting such level.\6\ Recently, Cboe Options determined to 
conduct an internal reorganization, pursuant to which it created a new 
entity, called Cboe Global Indices, LLC (which is a direct, wholly 
owned subsidiary of the Exchange's parent company, Cboe Global Markets, 
Inc.), into which it transferred its assets related to this index 
business. This transfer is expected to be effective as of September 30, 
2019.\7\ As a result, the Exchange designates Cboe Global Indices, LLC 
as the reporting authority for the indexes on which the Exchange may 
list options, and amends Rule 24.1, Interpretation and Policy .01.\8\ 
The Exchange represents this will have no impact on the dissemination 
of index values for any of these indexes. Values for these indexes will 
continue to be disseminated and available to market participants in the 
same manner and in the same intervals.\9\
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    \5\ See Rule 24.1, Interpretation and Policy .01 in the current 
Rulebook.
    \6\ See Rule 24.1(h).
    \7\ The Exchange initially filed the proposed change to the 
reporting authority name on September 30, 2019 (SR-CBOE-2019-074). 
On October 3, 2019, the Exchange withdrew that filing and submitted 
this filing.
    \8\ The Exchange notes it currently only lists options on the 
Cboe Volatility Index (VIX).
    \9\ Pursuant to Rule 24.2(b)(10), (d)(8), (e)(7), and (f)(11), 
the current value of an index must be disseminated at least once 
every 15 seconds by one or more major market data vendors. That will 
continue to be the case.
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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.\10\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \11\ 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) \12\ requirement that the rules of an exchange not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers. The proposed rule change removes impediments to 
and perfects the mechanism of a free and open market a national market 
system, and protects investors and the public interest, by updating its 
rules to reflect the current name of a reporting authority for various 
indexes on which the Exchange is authorized to list options. The 
Exchange believes this promotes transparency in its Rules and may 
eliminate any potential confusion among market participants. The 
proposed rule change has no impact on trading on the Exchange, or on 
the dissemination of index values, but merely reflects a change to the 
name of a reporting authority for various indexes on which the Exchange 
is authorized to list options due to a recent internal reorganization 
and transfer of assets.
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    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
    \12\ Id.
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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. The proposed rule change is 
not intended to be a competitive rule filing. Rather, the proposed rule 
change merely reflects a change to the name of a reporting authority 
for various indexes on which the Exchange is authorized to list options 
due to a recent internal reorganization and transfer of assets. The 
proposed rule change has no impact on trading on the Exchange, or on 
the dissemination of index values.

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

    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) of the Act \13\ and Rule 19b-
4(f)(6) thereunder.\14\
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its 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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[[Page 55675]]

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \15\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \16\ permits the 
Commission to 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 as the 
proposed rule change only updates its rules to reflect the current name 
of a reporting authority for various indexes on which the Exchange is 
authorized to list options. The Exchange believes that waiver of the 
operative delay is appropriate because, as the Exchange discussed 
above, its proposal does not make any substantive changes to the 
Exchange's rules. The Commission believes that waiver of the 30-day 
operative delay is consistent with the protection of investors and the 
public interest because the proposal does not raise any new or novel 
issues and makes only non-substantive changes to the rules. Therefore, 
the Commission hereby waives the operative delay and designates the 
proposal as operative upon filing.\17\
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    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
    \17\ For purposes only of waiving the 30-day operative delay, 
the Commission also 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 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 will institute proceedings to 
determine whether the proposed rule change 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 rule-comments@sec.gov. Please include 
File Number SR-CBOE-2019-091 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-CBOE-2019-091. 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 (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 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 10:00 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. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-CBOE-2019-091 and should be submitted on 
or before November 7, 2019.
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    \18\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-22591 Filed 10-16-19; 8:45 am]
 BILLING CODE 8011-01-P