Document ID: SEC-2014-1019-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2014-06-19T04:00Z

[Federal Register Volume 79, Number 118 (Thursday, June 19, 2014)]
[Notices]
[Pages 35205-35206]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-14316]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-72385; File No. SR-NYSEArca-2014-41)]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of 
Designation of a Longer Period for Commission Action on Proposed Rule 
Change, as Modified by Amendment Nos. 1 and 4 Thereto, Relating to 
Listing and Trading of Shares of the Reality Shares DIVS Index ETF 
Under NYSE Arca Equities Rule 5.2(j)(3)

June 13, 2014.
    On April 11, 2014, NYSE Arca, Inc. (``Exchange'') filed with the 
Securities and Exchange Commission (``Commission''), pursuant to 
Section

[[Page 35206]]

19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 
19b-4 thereunder,\2\ a proposed rule change to list and trade shares of 
the Reality Shares DIVS Index ETF (``Fund'') (formerly, Reality Shares 
Isolated Dividend Growth Index ETF) under NYSE Arca Equities Rule 
5.2(j)(3). The proposed rule change was published for comment in the 
Federal Register on April 30, 2014.\3\ On May 6, 2014, the Exchange 
filed Amendment No. 1 to the proposed rule change, which amended and 
replaced the proposed rule change in its entirety.\4\ On June 6, 2014, 
the Exchange filed Amendment No. 4 to the proposed rule change.\5\ The 
Commission received no comment letters on the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 72015 (Apr. 24, 
2014), 79 FR 24475.
    \4\ In Amendment No. 1, the Exchange clarifies the valuation of 
investments for purposes of calculating net asset value, provides 
additional details regarding the dissemination of the Disclosed 
Portfolio, and makes other minor technical edits to the proposed 
rule change.
    \5\ The Exchange filed Amendment No. 2 on June 4, 2014 and 
withdrew it on June 5, 2014, and filed Amendment No. 3 on June 5, 
2014 and withdrew it on June 6, 2014. Amendment No. 4 supersedes 
both Amendment Nos. 2 and 3. In Amendment No. 4, the Exchange amends 
the proposal to reflect a name change to the Fund and the underlying 
index. Specifically, the Exchange replaces each reference to 
``Reality Shares Isolated Dividend Growth Index ETF'' in the 
proposal with ``Reality Shares DIVS Index ETF,'' and replaces each 
reference to ``Reality Shares Isolated Dividend Growth Index'' in 
the proposal with ``Reality Shares DIVS Index.''
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    The proposed rule change would permit the listing and trading of 
shares of the Fund, which would seek long-term capital appreciation by 
tracking the performance of the Reality Shares DIVS Index (``Index'') 
(formerly, Reality Shares Isolated Dividend Growth Index). At least 80% 
of the Fund's total assets would be invested in the component 
securities of the Index, which would be calculated using a proprietary, 
rules-based methodology designed to track market expectations for 
dividend growth conveyed in real-time using the mid-point of the bid-
ask spread on U.S. exchange-listed S&P 500 Index options and U.S. 
exchange-listed options on exchange traded funds designed to track the 
S&P 500 Index. Under the proposal, the Fund would buy (i.e., hold a 
``long'' position in) and sell (i.e., hold a ``short'' position in) put 
and call options. The strategy of taking both a long position in a 
security through its ex-dividend date (the last date an investor can 
own the security and receive dividends paid on the security) and a 
corresponding short position in the same security immediately 
thereafter is designed to allow the Fund to isolate its exposure to the 
growth of the level of dividends expected to be paid on such security 
while minimizing its exposure to changes in the trading price of such 
security.
    Section 19(b)(2) of the Act \6\ provides that, within 45 days of 
the publication of notice of the filing of a proposed rule change, or 
within such longer period up to 90 days as the Commission may designate 
if it finds such longer period to be appropriate and publishes its 
reasons for so finding or as to which the self-regulatory organization 
consents, the Commission shall either approve the proposed rule change, 
disapprove the proposed rule change, or institute proceedings to 
determine whether the proposed rule change should be disapproved. The 
Commission is extending this 45-day time period.
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    \6\ 15 U.S.C. 78s(b)(2).
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    The Commission finds that it is appropriate to designate a longer 
period within which to take action on the proposed rule change so that 
it has sufficient time to consider the proposed rule change and the 
unique nature of the investment strategy of the proposed Fund.
    Accordingly, the Commission, pursuant to Section 19(b)(2) of the 
Act,\7\ designates July 29, 2014, as the date by which the Commission 
should either approve or disapprove or institute proceedings to 
determine whether to disapprove the proposed rule change (File Number 
SR-NYSEArca-2014-41).
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    \7\ Id.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(31).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-14316 Filed 6-18-14; 8:45 am]
BILLING CODE 8011-01-P