[Federal Register Volume 63, Number 226 (Tuesday, November 24, 1998)]
[Notices]
[Pages 64980-64981]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31353]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-40680; File No. SR-ODD-98-1]
Self-Regulatory Organizations; The Options Clearing Corporation;
Order Granting Approval to Proposed Supplement to Options Disclosure
Document Regarding Options on Exchange-Traded Fund Shares
November 13, 1998.
On November 13, 1998, The Options Clearing Corporation (``OCC'')
submitted to the Securities and Exchange Commission (``SEC'' or
``Commission''), pursuant to Rule 9b-1 under the Securities Exchange
Act of 1934 (``Act''),\1\ five definitive copies of a Supplement to its
options disclosure document (``ODD''), which describes, among other
things, the risks and characteristics of trading in options on
interests in unit investment trusts, investment companies, and similar
entities holding portfolios of equity securities.\2\
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\1\ 17 CFR 240.9b-1.
\2\ See Letter from James C. Yong, First Vice President and
General Counsel, OCC, to Sharon Lawson, Division of Market
Regulation, Commission, dated November 12, 1998.
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The ODD currently contains general disclosures on the
characteristics and risks of trading options on equity securities. The
Commission has approved proposals by two options exchanges to list and
trade options on interests in unit investment trusts, investment
companies, and similar entities holding portfolios of equity
securities.\3\ The proposed Supplement to the ODD provides for
disclosures to accommodate the introduction of these options. Pursuant
to Rule 9b-1, the Supplement will have to be provided to investors in
options on Exchange-Traded Fund Shares before their accounts are
approved for trading options on these products.
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\3\ See Securities Exchange Act Release Nos. 40157 (July 1,
1998) 63 FR 37426 (July 10, 1998) (order approving File No. SR-Amex-
96-44); and 40166 (July 2, 1998) 63 FR 37430 (July 10, 1998) (order
approving File No. SR-CBOE-97-03).
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The Commission has reviewed the ODD Supplement and finds that it
complies with Rule 9b-1 under the Act.\4\ The Supplement is intended to
be read in conjunction with the ODD, which discusses the
characteristics and risks of options generally. The Supplement provides
additional information regarding options on interests in unit
investment trusts, investment companies, and similar entities holding
portfolios of equity
[[Page 64981]]
securities sufficient to further describe the special characteristics
of these products.
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\4\ 17 CFR 240.9b-1.
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Rule 9b-1 provides that an options market must file five
preliminary copies of an amended ODD with the Commission at least 30
days prior to the date definitive copies of the ODD are furnished to
customers, unless the Commission determines otherwise, having due
regard for the adequacy of information disclosed and the protection of
investors.\5\ The Commission has reviewed the Supplement, and finds
that it is consistent with the protection of investors and in the
public interest to allow the distribution of the Supplement as of the
date of this order.
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\5\ This provision is intended to permit the Commission either
to accelerate or extend the time period in which definitive copies
of a disclosure document may be distributed to the public.
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It is therefore ordered, pursuant to Rule 9b-1 under the Act,\6\
that the proposed Supplement regarding options on interests in unit
investment trusts, investment companies, and similar entities holding
portfolios of equity securities (SR-ODD-98-1) is approved.
\6\ 17 CFR 240.9b-1.
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For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\7\
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\7\ 17 CFR 200.30-3(a)(39).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-31353 Filed 11-23-98; 8:45 am]
BILLING CODE 8010-01-M
