Document ID: SEC-2010-0044-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change ToPermit Concurrent Listing of $2.50 and $1 Strikes on MNX Options
Posted Date: 2010-01-11T05:00Z

[Federal Register: January 11, 2010 (Volume 75, Number 6)]
[Notices]               
[Page 1444-1445]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11ja10-103]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61270; File No. SR-CBOE-2009-099]

 
Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Permit Concurrent Listing of $2.50 and $1 Strikes on MNX 
Options

December 31, 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 December 23, 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 Exchange has designated this proposal as one 
constituting a stated policy, practice, or interpretation with respect 
to the meaning, administration, or enforcement of an existing rule 
under Section 19(b)(3)(A)(i) of the Act, and Rule 19b-4(f)(1) 
thereunder, which renders the proposal effective upon filing with the 
Commission.\3\ 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\ 17 CFR 240.19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    CBOE proposes to clarify that the Exchange may concurrently list 
$2.50 and $1 strikes on Mini-Nasdaq-100 Index (``MNX'') options, and 
that certain listing parameters only apply to $1 strikes on MNX 
options. 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

[[Page 1445]]

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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to clarify that the 
Exchange may concurrently list $2.50 and $1 strikes on Mini-Nasdaq-100 
Index (``MNX'') options, and that certain listing parameters only apply 
to $1 strikes on MNX options. The Exchange believes that the 
availability of $2.50 and $1 strike price intervals in MNX option 
series will provide investors with greater flexibility by allowing them 
to establish positions that are better tailored to meet their 
investment objectives.
    Since November 2008, the Exchange has had the ability to list $1 
strikes on MNX options.\4\ In connection with the proposal to permit $1 
strikes for MNX options, the Exchange established parameters subject to 
which $1 strikes may be added and delisted. For example, the number of 
initial series that the Exchange may add is limited to 11 series.\5\ 
Also, the total number of additional series that may be added for $1 
strikes is sixty (60) per expiration month for each series in MNX 
options.\6\
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    \4\ See Securities Exchange Act Release No. 58924 (November 10, 
2008), 73 FR 68464 (November 18, 2008) (SR-CBOE-2008-96) (order 
approving rule change to permit $1 strikes for MNX options).
    \5\ See Interpretation and Policy .01(j)(i).
    \6\ See Interpretation and Policy .01(j)(ii) to Rule 24.9.
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    Similar parameters do not exist with regard to the listing of $2.50 
strikes, and the Exchange now seeks to clarify that the parameters 
adopted with the proposal to permit $1 strikes for MNX options do not 
apply to the listing of $2.50 strikes for MNX options.\7\ In addition, 
the Exchange is proposing to codify a bracketing provision that 
prohibits the Exchange from listing strike prices with $1 intervals 
within $0.50 of an existing strike price in the same series. This 
bracketing provision is identical to an existing provision in effect 
for the $1 Strike Program, which permits the concurrent listing of 
$2.50 and $1 strikes.
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    \7\ See Interpretation and Policy .01(a) to Rule 24.9.
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2. Statutory Basis
    The Exchange believes this rule proposal is consistent with the Act 
and the rules and regulations under the Act applicable to a national 
securities exchange and, in particular, the requirements of Section 
6(b) of the Act.\8\ Specifically, the Exchange believes that the 
proposed rule change is consistent with the Section 6(b)(5) Act \9\ 
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 allowing the Exchange to list MNX options at $2.50 and $1 
strike price intervals.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 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 foregoing proposed rule change will take effect upon filing 
with the Commission pursuant to Section 19(b)(3)(A)(i) of the 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 rule.
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    \10\ 15 U.S.C. 78s(b)(3)(A)(i).
    \11\ 17 CFR 240.19b-4(f)(1).
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    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.

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-2009-099 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-2009-099. 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 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; 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-2009-099 and should be 
submitted on or before February 1, 2010.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-189 Filed 1-8-10; 8:45 am]
BILLING CODE 8011-01-P