Options Exchange Filings 


FINRA Rule 2630 (Options) and FINRA Rule 2359 (Position and Exercise Limits; Liquidations) incorporate certain option exchanges' requirements for options and warrant position and exchange limits. Changes to an options exchange rules could affect a FINRA-regulated firm’s compliance with the FINRA rules. Accordingly, FINRA will provide updates when an options exchange proposes or receives approval of an amendment to its rules for options and warrant position and exercise limits.

 

FINRA provisions that incorporate by reference the options exchanges’ position and exercise limit requirements include the following. 

FINRA Rule 2360(b)(3)(B) provides that "...no member shall effect for any account in which such member has an interest, or for the account of any partner, officer, director or employee therof, or for the account of any customer, an opening transaction in an option contract of any class of index options dealt in on an exchange if the member has reason to believe that as a result of such transaction the member or partner, officer, director, or employee therof, or customer, would, acting alone or in concert with others directly or indirectly, hold or control or be obligated in respect of an aggregate position in excess of position limits established by the exchange on which the option trades."

Changes to an exchange rule regarding equity option position limits could have an impact on a FINRA-regulated firm’s compliance with FINRA Rule 2360(b)(3)(A)(i). Accordingly, FINRA is providing information about the pending rule filings with the SEC seeking to amend position limits as well as any SEC orders approving or disapproving those rule filings.

Accordingly, below are links to pending rule filings with the SEC seeking to amend index option position limits as well as any SEC orders approving or disapproving those rule filings.

  • NYSE MKT 2013-83
    A proposed rule change filed by NYSE MKT LLC amending commentary .07 to Rule 904 to extend the pilot program that eliminated the position limits for options on SPDR S&P 500 ETF (SR-NYSEMKT-2013-83). The filing has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/nysemkt/2013/34-70734.pdf
  • CBOE 2013-106
    A proposed rule change filed by the Chicago Board Options Exchange, Incorporated relating to fourteen month extension of pilot program that eliminates position and exercise limits for physically-settled SPDR S&P 500 ETF Trust (“SPY”) options (SR-CBOE-2013-106) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/cboe/2013/34-70878.pdf
  • PHLX 2013-108
    A proposed rule change filed by NASDAQ OMX PHLX LLC relating to an extension of a pilot program for SPY position and exercise limits (SR-Phlx-2013-108) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/phlx/2013/34-70879.pdf
  • NYSE Arca 2013-130
    A proposed rule change filed by NYSE Arca, Inc. amending Commentary .06 to Rule 6.8 to extend the pilot program that eliminated the position limits for options on SPDR S&P 500 ETF (SR-NYSEArca-2013-130). The filing has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/nysearca/2013/34-70968.pdf
  • ISE 2013-62
    A proposed rule change filed by the International Securities Exchange, LLC to extend the pilot program that eliminated position and exercise limits for options on SPDR S&P 500 ETF (SR-ISE-2013-62). The filing has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/ise/2013/34-70967.pdf
  • BOX-2013-53
    A proposed rule change filed by BOX Options Exchange LLC to amend IM-3120-2 to Rule 3120 to extend the pilot program that eliminated the position limits for options on SPDR S&P 500 ETF (SR-BOX-2013-53). The filing has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/box/2013/34-70970.pdf
  • MIAX-2013-53
    A proposed rule change filed by Miami International Securities Exchange LLC for the extension of a pilot program for SPY options and exercise limits (SR-MIAX-2013-53) The filing has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. http://www.sec.gov/rules/sro/miax/2013/34-71014.pdf

FINRA Rule 2360(b)(3)(B) provides that “…no member shall effect for any account in which such member has an interest, or for the account of any partner, officer, director or employee thereof, or for the account of any customer, an opening transaction in an option contract of any class of index options dealt in on an exchange if the member has reason to believe that as a result of such transaction the member or partner, officer, director or employee thereof, or customer, would, acting alone or in concert with others, directly or indirectly, hold or control or be obligated in respect of an aggregate position in excess of position limits established by the exchange on which the option trades.”

Changes to an exchange rule regarding index option position limits could affect a FINRA-regulated firm’s compliance with FINRA Rule 2360(b)(3)(B). Accordingly, FINRA is providing information about the pending rule filings with the SEC seeking to amend index option position limits as well as any SEC orders approving or disapproving those rule filings.

  • No currently pending filings

FINRA Rule 2360(b)(2) provides that “[t]he position and exercise limits for FLEX Equity Options for members that are not also members of the exchange on which FLEX Equity Options trade shall be the same as the position and exercise limits as applicable to members of the exchange on which such FLEX Equity Options are traded.”

Changes to an exchange rule regarding FLEX Equity Options position and exercise limits could affect a FINRA-regulated firm’s compliance with FINRA Rule 2360(b)(2). Accordingly, FINRA is providing information about the pending rule filings with the SEC seeking to amend FLEX Equity Option position and exercise limits as well as any SEC orders approving or disapproving those rule filings.

  • No currently pending filings

FINRA Rule 2359(a) provides that “…no member shall effect for any account in which such member has an interest, or for the account of any partner, officer, director or employee thereof, or for the account of any customer, a purchase or sale transaction in an index warrant listed on a national securities exchange if the member has reason to believe that as a result of such transaction the member, or partner, officer, director or employee thereof, or customer would, acting alone or in concert with others, directly or indirectly, hold or control an aggregate position in an index warrant issue on the same side of the market, combining such index warrant position with positions in index warrants overlying the same index on the same side of the market, in excess of the position limits established by the exchange on which the index warrant is listed.”

FINRA Rule 2359(b) provides that “…no member or person associated with a member shall exercise, for any account in which such member or person associated with such member has an interest, or for the account of any partner, officer, director or employee thereof, or for the account of any customer, a long position in any index warrant if as a result thereof such member or partner, officer, director or employee thereof or customer, acting alone or in concert with others, directly or indirectly, has or will have exceeded the applicable exercise limit fixed from time to time by an exchange for an index warrant.”

Changes to an exchange rule regarding index warrants position and exercise limits could affect a FINRA-regulated firm’s compliance with FINRA Rule 2339(a) and (b). Accordingly, FINRA is providing information about the pending rule filings with the SEC seeking to amend position and exercise limits as well as any SEC orders approving or disapproving those rule filings.

  • No currently pending filings