Document ID: SEC-2009-1577-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Penny Pilot Program
Posted Date: 2009-11-09T05:00Z

[Federal Register: November 9, 2009 (Volume 74, Number 215)]
[Notices]               
[Page 57721-57722]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09no09-94]                         

[[Page 57721]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60919; File No. SR-CBOE-2009-079]

 
 Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to the Penny Pilot Program

November 3, 2009.
    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 28, 2009, the Chicago Board Options Exchange, 
Incorporated (``Exchange'' or ``CBOE'') filed with the Securities and 
Exchange Commission (the ``Commission'') the 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 
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

    CBOE proposes to amend proposes to amend its rules relating to the 
Penny Pilot Program. The text of the rule proposal is available on the 
Exchange's Web site (http://www.cboe.org/legal), 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 self-regulatory organization 
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 those 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 parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    CBOE proposes to identify the 75 option classes that will be added 
to the Penny Pilot Program beginning on November 2, 2009. CBOE recently 
received approval to extend and expand the Penny Pilot Program through 
December 31, 2010.\3\ As described in its filing, the Pilot Program 
will be expanded by adding 300 option classes, in groups of 75 classes 
each quarter beginning on the following dates: November 2, 2009, 
February 1, 2010, May 3, 2010, and August 2, 2010.\4\ The option 
classes will be identified based on national average daily volume in 
the six calendar months preceding their addition to the Pilot Program 
using data compiled by The Options Clearing Corporation, except that 
the month immediately preceding their addition to the Pilot Program 
would not be utilized for purposes of the six month analysis.
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    \3\ See Securities Exchange Act Release No. 60864 (October 22, 
2009), granting immediate effectiveness to SR-CBOE-2009-76.
    \4\ The classes to be added are among the most actively-traded, 
multiply-listed option classes that are not currently in the Pilot 
Program, excluding option classes with high premiums. An option 
class would be designated as ``high premium'' if, at the time of 
selection, the underlying security was priced at $200 per share or 
above, or the underlying index level was at 200 or above.
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    The following 75 option classes will be added to the Pilot Program 
beginning on November 2, 2009:

------------------------------------------------------------------------
               Symbol                            Company name
------------------------------------------------------------------------
ABX.................................  Barrick Gold Corp
AXP.................................  American Express Co
AUY.................................  Yamana Gold Inc
BA..................................  Boeing Co/The
BBT.................................  BB&T Corp
BBY.................................  Best Buy Co Inc
BP..................................  BP PLC
CHK.................................  Chesapeake Energy Corp
CIT.................................  CIT Group Inc
COF.................................  Capital One Financial Corp
CVX.................................  Chevron Corp
DE..................................  Deere & Co
DOW.................................  Dow Chemical Co/The
DRYS................................  DryShips Inc
EFA.................................  iShares MSCI EAFE Index Fund
ETFC................................  E*Trade Financial Corp
EWZ.................................  iShares MSCI Brazil Index Fund
FAS.................................  Direxion Daily Financial Bull 3X
                                       Shares
FAZ.................................  Direxion Daily Financial Bear 3X
                                       Shares
FITB................................  Fifth Third Bancorp
FSLR................................  First Solar Inc
FXI.................................  iShares FTSE/Xinhua China 25 Index
                                       Fund
GDX.................................  Market Vectors--Gold Miners ETF
GG..................................  Goldcorp Inc
GLD.................................  SPDR Gold Trust
HGSI................................  Human Genome Sciences Inc
HIG.................................  Hartford Financial Services Group
                                       Inc
HPQ.................................  Hewlett-Packard Co
IBM.................................  International Business Machines
                                       Corp
IYR.................................  iShares Dow Jones US Real Estate
                                       Index Fund
JNJ.................................  Johnson & Johnson
JNPR................................  Juniper Networks Inc
KO..................................  Coca-Cola Co/The
LVS.................................  Las Vegas Sands Corp
MCD.................................  McDonald's Corp
MGM.................................  MGM Mirage
MON.................................  Monsanto Co
MOS.................................  Mosaic Co/The
MRK.................................  Merck & Co Inc/NJ
MS..................................  Morgan Stanley
NLY.................................  Annaly Capital Management Inc
NOK.................................  Nokia OYJ
NVDA................................  Nvidia Corp
ORCL................................  Oracle Corp
PALM................................  Palm Inc
PBR.................................  Petroleo Brasileiro SA
PG..................................  Procter & Gamble Co/The
POT.................................  Potash Corp of Saskatchewan Inc
RF..................................  Regions Financial Corp
RIG.................................  Transocean Ltd
RMBS................................  Rambus Inc
S...................................  Sprint Nextel Corp
SDS.................................  ProShares UltraShort S&P500
SKF.................................  ProShares UltraShort Financials
SLB.................................  Schlumberger Ltd
SLV.................................  iShares Silver Trust
SRS.................................  ProShares UltraShort Real Estate
SSO.................................  ProShares Ultra S&P500
STI.................................  SunTrust Banks Inc
SVNT................................  Savient Pharmaceuticals Inc
TBT.................................  ProShares UltraShort 20+ Year
                                       Treasury
UNG.................................  United States Natural Gas Fund LP
UNH.................................  UnitedHealth Group Inc
UPS.................................  United Parcel Service Inc
USB.................................  US Bancorp
USO.................................  United States Oil Fund LP
UYG.................................  ProShares Ultra Financials
V...................................  Visa Inc
WFC.................................  Wells Fargo & Co
WYNN................................  Wynn Resorts Ltd
X...................................  United States Steel Corp
XHB.................................  SPDR S&P Homebuilders ETF
XLI.................................  Industrial Select Sector SPDR Fund
XLU.................................  Utilities Select Sector SPDR Fund
XRT.................................  SPDR S&P Retail ETF
------------------------------------------------------------------------

    The minimum increments for all classes in the Penny Pilot, except 
for the QQQQs, continue to be $0.01 for all option series below $3 
(including LEAPS), and $0.05 for all option series $3 and above 
(including LEAPS). For QQQQs, the minimum increment remains $0.01 for 
all option series.
 2. Statutory Basis
    The Exchange believes the rule proposal is consistent with the 
Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations under the Act applicable to a national

[[Page 57722]]

securities exchange and, in particular, the requirements of Section 
6(b) of the Act.\5\ Specifically, the Exchange believes that the 
proposed rule change is consistent with the Section 6(b)(5) Act \6\ 
requirements that the rules of an exchange be designed to promote just 
and equitable principles of trade, to prevent fraudulent and 
manipulative acts and, in general, to protect investors and the public 
interest by identifying the option classes to be added to the Pilot 
Program in a manner consistent with CBOE's prior rule filing SR-CBOE-
2009-76 to extend and expand the Pilot Program.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE does not believe that the proposed rule change will impose any 
burden on competition not necessary or appropriate in furtherance of 
the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The proposed rule change is filed for immediate effectiveness 
pursuant to Section 19(b)(3)(A) \7\ of the Securities Exchange Act of 
1934 and Rule 19b-4(f)(1) \8\ thereunder as it constitutes a stated 
policy, practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule. At any time within 
60 days of the filing of the proposed rule change, the Commission may 
summarily abrogate 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.
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(1).
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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

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-CBOE-2009-079 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2009-079. This file 
number should be included on the subject line if e-mail 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 inspection and 
copying 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 such filing also will be available for 
inspection and copying at the principal office of the CBOE. 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-CBOE-2009-079 and should be 
submitted on or before November 30, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-26883 Filed 11-6-09; 8:45 am]

BILLING CODE 8011-01-P