Document ID: SEC-2009-1603-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Add 75 Classes to the Penny Pilot Program
Posted Date: 2009-11-13T05:00Z

[Federal Register: November 13, 2009 (Volume 74, Number 218)]
[Notices]               
[Page 58666-58668]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13no09-101]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60950; File No. SR-BX-2009-069]

 
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Add 75 
Classes to the Penny Pilot Program

November 6, 2009.
    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 October 27, 2009, NASDAQ OMX BX, Inc. (the ``Exchange'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I, II, and III below, which Items 
have been prepared by the self-regulatory organization. The Commission 
is publishing this notice to solicit comments on the proposed rule 
change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.

---------------------------------------------------------------------------

[[Page 58667]]

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

    NASDAQ OMX BX, Inc. (the ``Exchange'') proposes to designate 75 
options classes to be added to the Penny Pilot Program, as referenced 
in Chapter V, Section 33 of the Rules of the Boston Options Exchange 
Group, LLC (``BOX''). The Exchange intends to notify Participants of 
the classes to be added to the Penny Pilot Program via Regulatory 
Circular. The text of the proposed Regulatory Circular is attached as 
Exhibit 2.\3\
---------------------------------------------------------------------------

    \3\ The Commission notes that the text of the proposed 
Regulatory Circular is attached at Exhibit 2 to the Form 19b-4, but 
is not attached to this Notice.
---------------------------------------------------------------------------

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 these statements may be examined at 
the places specified in Item IV below. The self-regulatory organization 
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
    On Monday, October 19, 2009 the Exchange submitted a proposed rule 
change with the Securities and Exchange Commission (``Commission'') to 
(i) extend the Penny Pilot Program in options classes (``Penny Pilot 
Program'') previously approved by the Commission through December 31, 
2010; (ii) expand the number of classes included in the Penny Pilot 
Program; and (iii) replace on a semi-annual basis any Penny Pilot 
Program classes that have been delisted.\4\
---------------------------------------------------------------------------

    \4\ See Securities and Exchange Act Release No. 60886 (October 
27, 2009) (SR-BX-2009-067). This proposal was effective immediately 
upon filing.
---------------------------------------------------------------------------

    The top 300 most actively traded multiply listed options classes in 
the prior six calendar months \5\ preceding their addition to the Penny 
Pilot Program that are not yet included in the Penny Pilot Program will 
be phased-in to the Penny Pilot Program over four successive quarters 
with 75 classes added in each of November 2009, February 2010, May 
2010, and August 2010.\6\ Options classes with high premiums will be 
excluded for the quarterly additions.\7\
---------------------------------------------------------------------------

    \5\ For purposes of assessing national average daily volume the 
Exchange will use data compiled and disseminated by the Options 
Clearing Corporation.
    \6\ The quarterly additions will be effective on November 2, 
2009, February 1, 2010, May 3, 2010 and August 2, 2010, 
respectively. For purposes of identifying the classes to be added 
per quarter, the Exchange shall use data from the prior six calendar 
months preceding the implementation month, except that the month 
immediately preceding their addition to the Pilot would not be 
utilized for purposes of the six month analysis. For example, the 
quarterly additions to be added on November 2, 2009 shall be 
determined using data from the six month period ending September 30, 
2009.
    \7\ The threshold for designation as ``high priced'' at the time 
of selection of new classes to be included in the Penny Pilot 
Program is $200 per share or a calculated index value of 200. The 
determination of whether a security is trading above $200 or above a 
calculated index value of 200 shall be based on the price at the 
close of trading on the Expiration Friday prior to being added to 
the Penny Pilot Program.
---------------------------------------------------------------------------

    Based on trading activity for the six months ending September 30, 
2009, the Exchange proposes to add the following 75 classes to the 
Penny Pilot Program on November 2, 2009:

----------------------------------------------------------------------------------------------------------------
   Nat'l ranking          Symbol          Company name      Nat'l ranking          Symbol         Company name
----------------------------------------------------------------------------------------------------------------
118...............  ABX...............  Barrick Gold      120..............  MRK..............  Merck & Co Inc/
                                         Corp.                                                   NJ.
134...............  AUY...............  Yamana Gold Inc.  35...............  MS...............  Morgan Stanley.
48................  AXP...............  American Express  73...............  NLY..............  Annaly Capital
                                         Co.                                                     Management Inc.
93................  BA................  Boeing Co/The...  99...............  NOK..............  Nokia OYJ.
115...............  BBT...............  BB&T Corp.......  121..............  NVDA.............  Nvidia Corp.
111...............  BBY...............  Best Buy Co Inc.  80...............  ORCL.............  Oracle Corp.
94................  BP................  BP PLC..........  61...............  PALM.............  Palm Inc.
67................  CHK...............  Chesapeake        37...............  PBR..............  Petroleo
                                         Energy Corp.                                            Brasileiro SA.
58................  CIT...............  CIT Group Inc...  85...............  PG...............  Procter & Gamble
                                                                                                 Co/The.
78................  COF...............  Capital One       41...............  POT..............  Potash Corp of
                                         Financial Corp.                                         Saskatchewan
                                                                                                 Inc.
68................  CVX...............  Chevron Corp....  74...............  RF...............  Regions
                                                                                                 Financial Corp.
130...............  DE................  Deere & Co......  124..............  RIG..............  Transocean Ltd.
104...............  DOW...............  Dow Chemical Co/  132..............  RMBS.............  Rambus Inc.
                                         The.
49................  DRYS..............  DryShips Inc....  103..............  S................  Sprint Nextel
                                                                                                 Corp.
88................  EFA...............  iShares MSCI      83...............  SDS..............  ProShares
                                         EAFE Index Fund.                                        UltraShort
                                                                                                 S&P500.
64................  ETFC..............  E*Trade           122..............  SKF..............  ProShares
                                         Financial Corp.                                         UltraShort
                                                                                                 Financials.
32................  EWZ...............  iShares MSCI      107..............  SLB..............  Schlumberger
                                         Brazil Index                                            Ltd.
                                         Fund.
25................  FAS...............  Direxion Daily    91...............  SLV..............  iShares Silver
                                         Financial Bull                                          Trust.
                                         3X Shares.
33................  FAZ...............  Direxion Daily    84...............  SRS..............  ProShares
                                         Financial Bear                                          UltraShort Real
                                         3X Shares.                                              Estate.
112...............  FITB..............  Fifth Third       119..............  SSO..............  ProShares Ultra
                                         Bancorp.                                                S&P500.
70................  FSLR..............  First Solar Inc.  101..............  STI..............  SunTrust Banks
                                                                                                 Inc.
26................  FXI...............  iShares FTSE/     125..............  SVNT.............  Savient
                                         Xinhua China 25                                         Pharmaceuticals
                                         Index Fund.                                             Inc.
82................  GDX...............  Market Vectors--  92...............  TBT..............  ProShares
                                         Gold Miners ETF.                                        UltraShort 20+
                                                                                                 Year Treasury.
127...............  GG................  Goldcorp Inc....  14...............  UNG..............  United States
                                                                                                 Natural Gas
                                                                                                 Fund LP.
18................  GLD...............  SPDR Gold Trust.  117..............  UNH..............  UnitedHealth
                                                                                                 Group Inc.
129...............  HGSI..............  Human Genome      110..............  UPS..............  United Parcel
                                         Sciences Inc.                                           Service Inc.
62................  HIG...............  Hartford          81...............  USB..............  US Bancorp.
                                         Financial
                                         Services Group
                                         Inc.
72................  HPQ...............  Hewlett-Packard   44...............  USO..............  United States
                                         Co.                                                     Oil Fund LP.
59................  IBM...............  International     60...............  UYG..............  ProShares Ultra
                                         Business                                                Financials.
                                         Machines Corp.
45................  IYR...............  iShares Dow       96...............  V................  Visa Inc.
                                         Jones US Real
                                         Estate Index
                                         Fund.
105...............  JNJ...............  Johnson &         10...............  WFC..............  Wells Fargo &
                                         Johnson.                                                Co.
131...............  JNPR..............  Juniper Networks  133..............  WYNN.............  Wynn Resorts
                                         Inc.                                                    Ltd.

[[Page 58668]]

98................  KO................  Coca-Cola Co/The  52...............  X................  United States
                                                                                                 Steel Corp.
39................  LVS...............  Las Vegas Sands   114..............  XHB..............  SPDR S&P
                                         Corp.                                                   Homebuilders
                                                                                                 ETF.
87................  MCD...............  McDonald's Corp.  86...............  XLI..............  Industrial
                                                                                                 Select Sector
                                                                                                 SPDR Fund.
71................  MGM...............  MGM Mirage......  79...............  XLU..............  Utilities Select
                                                                                                 Sector SPDR
                                                                                                 Fund.
113...............  MON...............  Monsanto Co.....  54...............  XRT..............  SPDR S&P Retail
                                                                                                 ETF.
63................  MOS...............  Mosaic Co/The...                                        ................
----------------------------------------------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\8\ in general, and Section 
6(b)(5) of the Act,\9\ in particular, in that it is designed 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 for a free and open market and a national market 
system and, in general, to protect investors and the public interest, 
by identifying the options classes added to the Pilot in a manner 
consistent with prior rule changes.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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 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

    The Exchange has neither solicited nor received comments on the 
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(i) of the Exchange Act \10\ and Rule 19b-4(f)(1) 
thereunder,\11\ because it constitutes a stated policy, practice, or 
interpretation with respect to the meaning, administration, or 
enforcement of an existing BOX rule. At any time within 60 days of the 
filing of the proposed rule change, the Commission may summarily 
abrogate the rule change if it appears to the Commission that the 
action is necessary or appropriate in the public interest, for the 
protection of investors, or would otherwise further the purposes of the 
Act.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A)(i).
    \11\ 17 CFR 240.19b-4(f)(1).
---------------------------------------------------------------------------

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-BX-2009-069 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-BX-2009-069. 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 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-BX-2009-069 and should be 
submitted on or before December 4, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
---------------------------------------------------------------------------

    \12\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-27256 Filed 11-12-09; 8:45 am]

BILLING CODE 8011-01-P