[Federal Register Volume 61, Number 187 (Wednesday, September 25, 1996)]
[Notices]
[Pages 50358-50361]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24493]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37696; File No. SR-CBOE-96-44]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Inc.; Order Approving Proposed Rule Change and Notice of Filing and
Order Granting Accelerated Approval of Amendment No. 1 Thereto Relating
to the Listing and Trading of Options on the Goldman, Sachs Technology
Composite Sub-Indexes
September 17, 1996.
On July 2, 1996, the Chicago Board Options Exchange, Inc. (``CBOE''
or ``Exchange'') submitted to the Securities and Exchange Commission
(``SEC'' or ``Commission''), pursuant to Section 19(b) of the
Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to list and trade options on six
different narrow-based indexes, each of which is composed of components
from the GSTI Composite Index (``GSTI Composite Index'').\3\ The six
sub-indexes are: the GSTI Internet Index (``Internet Index''), the GSTI
Software Index (``Software Index''), the GSTI Semiconductor Index
(``Semiconductor Index''), the GSTI Hardware Index (``Hardware
Index''), the GSTI Services Index (``Services Index''), and the GSTI
Multimedia Networking Index (``Multimedia Index'') (collectively ``GSTI
Sub-Indexes'' or ``Sub-Indexes''). Notice of the proposed rule change
appeared in the Federal Register on August 8, 1996.\4\ No comments were
received on the proposal. On September 16, 1996, CBOE filed Amendment
No. 1 to the proposal to address issues related to index maintenance
criteria.\5\ This order approves the proposal, as amended, and solicits
comments on Amendment No. 1.
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\1\ 15 U.S.C. Sec. 78s(b)(1) (1988 & Supp. V 1993).
\2\ 17 CFR 240.19b-4 (1994).
\3\ Concurrent with this order, the Commission is approving a
CBOE proposal to list and trade options on the Goldman Sachs
Technology Composite Index, a broad-based, capitalization weighted
index composed of the universe of technology-related company stocks
meeting certain objective criteria, as amended. See Securities
Exchange Act Release No. 37693 (``SR-CBOE-96-43''). A list of
components for the Composite Index or any of the Sub-Indexes is
available at the Commission or CBOE.
\4\ Securities Exchange Act Release No. 37509 (July 31, 1996),
61 FR 41434.
\5\ Letter from Eileen Smith, CBOE, to Stephen M. Youhn, SEC,
dated September 16, 1996.
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I. Description of the Proposal
The purpose of the proposal is to permit the Exchange to list and
trade cash-settled, European-style index options on the GSTI Sub-
Indexes. Each GSTI Sub-Index is narrow-based, modified-capitalization
weighted, and composed of components of the GSTI Composite Index.
Goldman, Sachs & Co. has designated a GSTI Committee (``Committee'') to
oversee the selection of GSTI Sub-Index components, as discussed below.
Index Design. As discussed in greater detail in SR-CBOE-96-43, the
GSTI Composite Index is comprised of the universe of securities that
satisfy objective criteria (GSTI Index Rules'').\6\ Upon inclusion in
the GSTI Composite Index, the Committee then selects and assigns stocks
to the GSTI Sub-Indexes based upon relevant qualitative criteria.
Furthermore, any stock in a Sub-Index must appear in the GSTI Composite
Index. Stocks may be represented in one or more GSTI Sub-Indexes,
however, not all GSTI Composite Index components necessarily will be
assigned to a GSTI Sub-Index. All of the components of the GSTI
Composite Index currently trade on the New York Stock Exchange
(``NYSE''), the American Stock Exchange or Nasdaq.
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\6\ All securities satisfying the following criteria are
automatically included in the GSTI Composite Index: First, a
company's stock must trade on the New York Stock Exchange, the
American Stock Exchange or through the facilities of the Nasdaq, and
be a ``reported security'' under rule 11Aa3-1. Only outstanding
common shares are eligible for inclusion. Additionally, only foreign
companies whose primary market is in the United States will be
eligible for the Index; American Depositary Receipts are not
eligible. Second, the total market capitalization of the company's
stock must be equal to or greater than the capitalization ``cutoff''
value. The initial base period ``cutoff'' value will be $600
million, but this value will be adjusted on each semiannual
rebalancing date (as described below) to reflect the price
performance of the Index since the base period and rounded up to the
nearest $50 million. Index constituents with capitalization below
50% of the ``cutoff'' value on a semiannual rebalancing date shall
be removed after the close on the effective date of the rebalancing.
Third, company stocks with a public float below 20% of shares issued
and outstanding are not eligible for inclusion in the Index. Fourth,
the company stock must have annualized share turnover of 30% or
more, based on its average daily share volume for the six calendar
months prior to inclusion in the Index. Fifth, the components must
be from a group of Standard Industrial Classification codes or
Russell Industry codes.
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Calculation. The Sub-Index will be calculated by CBOE on a real-
time basis using last-sale prices and will be disseminated every 15
seconds by CBOE.\7\ If a component security is not currently being
traded on its primary market, the most recent price at which the
security traded on such market will be used in the Index calculation.
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\7\ Telephone conversation between Eileen Smith, CBOE and Sharon
Lawson, SEC, on September 17, 1996. The original filing proposed
that the Sub-Index values be calculated by CBOE or a designee of
Goldman, Sachs.
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The Sub-Indexes are calculated on a ``modified capitalization-
weighted'' method, which is a hybrid between equal weighting (which may
impose liquidity concerns for smaller-cap stocks) and capitalization
weighting (which may result in two or three stocks dominating an
index's performance). Under the method employed for each of the sub-
indexes, the maximum weight for the largest stock in the sub-index will
be set to no higher than 25% on the semiannual rebalancing date. The
maximum weight for the second largest stock will be set to no higher
than 20% of the maximum weight for the third largest stock and any
stock thereafter will be set to no higher than 15% on the rebalancing
date. The weight of all the remaining Sub-Index stocks shall be market
capitalization weighted. Thus, the weights of these remaining stocks
[[Page 50359]]
are not ``capped.'' At the time of semi-annual rebalancing, stocks with
Sub-Index weights in excess of their capped weight in that Sub-Index,
will be restored to the appropriate capped weight.
For stocks which are not ``capped,'' the number of index shares
will equal the company's outstanding common shares. For stocks which
are capped, index shares will equal its maximum weight, multiplied by
the adjusted total market capitalization of the sub-index, divided by
the stock's closing price on the rebalancing date. The index's adjusted
total market capitalization is the total outstanding market
capitalization adjusted to reflect the number of ``capped'' stocks.
The divisor for each Sub-Index was initially calculated to yield a
benchmark value of 100.00 at the close of trading on April 30, 1996.
The divisor for each Sub-Index will be adjusted as needed to ensure
continuity in each index whenever there are additions or deletions from
an index, share changes, or adjustments to a component's price to
reflect rights offerings, spinoffs, and special cash dividends.
Maintenance. The Sub-Indexes will be maintained by CBOE and the
GSTI Committee. The GSTI Composite Index will be adjusted on each semi-
annual rebalancing date by adding or deleting stocks according to the
inclusion criteria detailed in SR-CBOE-96-43.\8\ All changes to the
GSTI Composite Index will then be implemented after the close of
trading on the effective date, which will be the third Friday of
January and July. The rebalancing date will be 7 business days prior to
the effective date.
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\8\ See supra note 6. The GSTI Composite Index is comprised of
the universe of technology stocks and all securities that meet the
previously established inclusion criteria are added to the Index at
the time of semi-annual rebalancing. CBOE maintains the GSTI
Composite Index.
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As soon after the close of trading on the day following the
rebalancing date for the GSTI Composite Index, the Exchange will
provide to the Committee a list of all constituent changes to the GSTI
Composite Index. Upon receipt of this list from the Exchange, the
Committee will meet to determine any changes to the GSTI Sub-Indexes.
The Committee will notify CBOE of any change in composition for any
of the GSTI Sub-Indexes before trading starts on the trading day after
the Exchange has provided the Composite Index component list to the
Committee.\9\ The Exchange, in turn, will disseminate the information
concerning the components of the GSTI Sub-Indexes to the public at
least five days before the effective date, wherever possible. The
Committee retains discretion to add or delete stocks from the GSTI Sub-
Indexes at the rebalancing or to change a stock's industry
classification. A stock must appear in the GSTI Composite Index to be
eligible for inclusion in a Sub-Index. At the discretion of the
Committee, a stock may also be removed from a Sub-Index due to lack of
industry representation in the Sub-Index.
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\9\ For example, if CBOE provides to the Committee a list of
composition changes to the GSTI Composite Index after the close of
trading on Friday, the Committee would in turn inform CBOE of any
corresponding changes to the GSTI Sub-Indexes before trading
commences on Monday. CBOE would then disseminate such changes to the
public at least five business days prior to the effective date,
wherever possible. Telephone Conversation between Eileen Smith,
CBOE, and Steve Youhn, SEC, on July 24, 1996.
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The maintenance criteria applicable to the GSTI Composite Index, as
described in SR-CBOE-96-43, also will apply to the GSTI Sub-Indexes.
First, at least 75% of the weight of any Sub-Index must be options
eligible pursuant to CBOE Rule 5.3. Second, Sub-Index constituents with
capitalization below 50% of the ``cutoff'' value on a semiannual
rebalancing date shall be removed after the close on the effective date
of the rebalancing. Third, if the market capitalization of any
component drops below $75 million at the time of the semiannual
rebalancing, it must be options eligible.\10\ Fourth, no more than 10%
of the weight of a Sub-Index may be composed of stocks with average
daily trading volume for the previous six-month period of less than
20,000 shares. Finally, at no time will a Sub-Index fall to less than 6
stocks.\11\ In the event that a Sub-Index does not comply with these
maintenance criteria, CBOE will notify Commission staff to determine
the appropriate regulatory response. Such responses could include, but
are not limited to, the removal of securities from a Sub-Index,
prohibiting opening transactions, or discontinuing the listing of new
series in any Sub-Index.\12\
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\10\ See Amendment No. 1.
\11\ Currently, the Sub-Indexes range from 9 to 45 components.
\12\ See Amendment No. 1.
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When a stock is ``Fast Added'' to the GSTI Composite Index, as
described in SR-CBOE-96-43, the stock may be ``Fast Added'' to one or
more GSTI Sub-Indexes at the same time. If added to a Sub-Index, the
stock's weight cannot exceed the appropriate cap for that Sub-Index. If
a stock is ``Fast Deleted'' from the GSTI Composite Index, it will be
removed from all GSTI Sub-Indexes at the same time.
In the case of a merger, the Committee will decide the Sub-Index
classification of the merged company. If the weight of the merged
company would exceed the relevant cap for the Sub-Index to which it is
assigned, the weight of the company will be capped at the time that the
merger is completed. The index shares of all other stocks in the
effected Sub-Index will remain unchanged.
As discussed above, the Committee is responsible for making
component changes to the Sub-Indexes. Accordingly, a ``chinese wall''
has been erected around the personnel at Goldman, Sachs who have access
to information concerning changes and adjustments to the GSTI Composite
Index and Sub-Indexes. Details of Goldman, Sachs ``chinese wall''
procedures, which are closely modeled on existing procedures for other
Goldman, Sachs derivative products, have been submitted to the
Commission under separate cover.
Index Option Trading. The Exchange proposes to base trading in
options on the GSTI Sub-Indexes on the full value of the relevant Sub-
Index. The Exchange may list full-value long-term index option series
(``LEAPS''), as provided in Rule 24.9. The Exchange also may
provide for the listing of reduced-value LEAPS, for which the
underlying value would be computed at one-tenth of the value of the
appropriate Sub-Index (all such LEAPS series are hereinafter referred
to as ``LEAPS''). The current and closing index value of any such
reduced-value LEAPS will, after such initial computation, be rounded to
the nearest one-hundredth. Strike prices will be set to bracket the
index in a minimum of 2\1/2\ point increments for strikes below 200 and
5 point increments above 200. The minimum tick size for series trading
below $3 will be \1/16\th and for series trading above $3 the minimum
tick will be \1/8\th. The trading hours for options on the Index will
be from 8:30 a.m. to 3:10 p.m. Chicago time.
Exercise and Settlement. GSTI Sub-Index options will have European-
style exercise and will be ``A.M.-settled index options'' within the
meaning of the Rules in Chapter XXIV, including Rule 24.9, which is
being amended to refer specifically to GSTI Sub-Index options. The last
reported sale price of such a component security shall be used in any
case where that component security does not open for trading on that
day.\13\
[[Page 50360]]
The proposed options will expire on the Saturday following the third
Friday of the expiration month. Thus, the last day for trading in an
expiring series will be the second business day (ordinarily a Thursday)
preceding the expiration date.
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\13\ The Commission notes that pursuant to Article XVII, Section
4 of the Options Clearing Corporation's (``OCC'') by-laws, OCC is
empowered to fix an exercise settlement amount in the event it
determines a current index value is unreported or otherwise
unavailable. Further, OCC has the authority to fix an exercise
settlement amount whenever the primary market for the securities
representing a substantial part of the value of an underlying index
is not open for trading at the time when the current index value
(i.e., the value used for exercise settlement purposes) ordinarily
would be determined. See Securities Exchange Act Release No. 37315
(June 17, 1996), 61 FR 42671 (Aug. 16, 1996) (order approving SR-
OCC-95-19).
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Exchange Rules Applicable. Except as modified herein, the Rules in
Chapter XXIV will be applicable to GSTI Sub-Index options. Index option
contracts based on the GSTI Sub-Indexes will be subject to the position
limit requirements of Rule 24.4A.\14\ Ten reduced-value options will
equal one full-value contract for such purposes.
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\14\ CBOE Rule 24.4A sets position and exercise limits for
narrow-based index options under a tiering approach based on the
applicable concentration of the component securities. Each of the
Sub-Indexes is subject to a position limit of 9,000 contracts on the
same side of the market.
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CBOE represents that it has the necessary systems capacity to
support new series that would result from the introduction of the GSTI
Sub-Index options. CBOE has also been informed that the Options Price
Reporting Authority (``OPRA'') has the capacity to support such new
series.
II. Findings and Conclusions
The Commission finds that the proposed rule change is consistent
with the requirements of the Act and the rules and regulations
thereunder applicable to a national securities exchange, and,
particular, the requirements of Section 6(b)(5).\15\ Specifically, the
Commission finds that the trading of options on the GSTI Sub-Indexes,
including LEAPS, will serve to promote the public interest and help to
remove impediments to a free and open securities market by providing
investors with additional means to hedge exposure to market risk
associated with stocks in the various high technology sub-sectors.\16\
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\15\ U.S.C. Sec. 78f(b)(5) (1988).
\16\ Pursuant to Section 6(b)(5) of the Act, the Commission must
predicate approval of any new option proposal upon a finding that
the introduction of such new derivative instrument is in the public
interest. Such a finding would be difficult for a derivative
instrument that served no hedging or other economic function,
because any benefits that might be derived by market participants
likely would be outweighed by the potential for manipulation,
diminished public confidence in the integrity of the markets, and
other valid regulatory concerns. In this regard, the trading of
listed options on the Sub-Indexes will provide investors with a
hedging vehicle that should reflect the overall movement of the
stocks representing companies in the high technology sub-industries
in the U.S. stock markets.
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The trading of options on the GSTI Sub-Indexes and on reduced-value
Indexes, however, raises several issues relating to index design,
customer protection, surveillance, and market impact. The Commission
believes, for the reasons discussed below, that CBOE adequately has
addressed these issues.
A. Index Design and Structure
The Commission believes it is appropriate for the Exchange to
designate the Sub-Indexes as narrow-based for purposes of index options
trading. The Sub-Indexes are comprised of a smaller number of stocks
from the GSTI Composite Index and are intended to trade specific sub-
industries of the high capitalization technology sector of the equities
market. Accordingly, the Commission believes it is appropriate for CBOE
to apply its rules governing narrow-based index options to trading in
the GSTI Sub-Index options.\17\
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\17\ The Commission also believes that each of the reduced value
Sub-Indexes are narrow-based because they are composed of the same
component securities as the Sub-Indexes, and merely dividing a Sub-
Index value by ten will not alter its basic character.
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The Commission believes that the large capitalizations, liquid
markets, and relative weightings of the component stocks for each Sub-
Index significantly minimizes the potential for manipulation of the
Sub-Index. As discussed above, each of the Sub-Indexes must be composed
only of components of the GSTI Composite Index. Accordingly, the
inclusion standards applicable to the GSTI Composite Index will apply
to each of the Sub-Indexes.\18\
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\18\ See supra note 6 for the inclusion standards. In approving
the GSTI Composite Index (SR-CBOE-96-43), the Commission makes a
concurrent finding that the GSTI Composite Index is broad-based
because it represents a substantial segment of the U.S. equities
market. In addition, the Commission finds that the general broad
diversification, capitalization, and relatively liquid markets of
the GSTI Composite Index's component stocks significantly minimize
the potential for manipulation of that Index.
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In this regard, the Commission notes that the market
capitalizations of the stocks in the Sub-Indexes are very large,
ranging from a high of $67 billion to a low of $636 million. Because
the Sub-Indexes are modified capitalization-weighted, as described
above, no one stock or group of stocks dominates a particular Sub-
Index.
Second, the proposed maintenance criteria will serve to ensure
that: (A) the Sub-Indexes are not dominated by one or several
securities that do not satisfy the Exchange's options listing criteria;
(B) the Sub-Indexes remain composed substantially of liquid highly
capitalized securities. Specifically, all components must have a
minimum market capitalization of $75 million and be options eligible;
(C) the Sub-Indexes remain composed of actively traded securities.
Specifically, the Commission notes that no more than 10% of the
capitalization of a Sub-Index may be represented by stocks with average
daily volume for the previous six-month period of less than 20,000
shares; and (D) the Sub-Indexes are comprised of no less than six
components at all times.\19\ In the event a Sub-Index fails to comply
with these criteria, CBOE will notify Commission staff to determine the
appropriate regulatory response. Such responses could include, but are
not limited to, the removal of components from a Sub-Index, prohibiting
opening transactions, or discontinuing the listing of new series in any
Sub-Index.
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\19\ See supra note 11.
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Third, CBOE and the Committee will be required to ensure that each
component of a Sub-Index is subject to last sale reporting requirements
in the U.S. pursuant to Rule 11Aa3-1 of the Act. This will further
reduce the potential for manipulation of the value of the Index.
Finally, the Commission believes that the existing mechanisms to
monitor trading activity in the component stocks of the Index, or
options on those stocks, will help deter as well as detect any illegal
activity.
B. Customer Protection
The Commission believes that a regulatory system designed to
protect public customers must be in place before the trading of
sophisticated financial instruments, such as Sub-Index options
(including full-value and reduced-value long-term Index options), can
commence on a national securities exchange. The Commission notes that
the trading of standardized exchange-traded options occurs in an
environment that is designed to ensure, among other things, that: (1)
The special risks of options are disclosed to public customers; (2)
only investors capable of evaluating and bearing the risks of options
trading are engaged in such trading; and (3) special compliance
procedures are applicable to options accounts. Accordingly, because the
Sub-Index options will be subject to the same regulatory regime as the
other standardized index options currently traded on CBOE, the
Commission believes that adequate safeguards are in place to ensure the
protection of investors in Sub-Index options and LEAPS.
[[Page 50361]]
C. Surveillance
The Commission believes that a surveillance sharing agreement
between an exchange proposing to list a stock index derivative product
and the exchange(s) trading the stocks underlying the derivative
product is an important measure for surveillance of the derivative and
underlying securities markets. Such agreements ensure the availability
of information necessary to detect and deter potential manipulations
and other trading abuses, thereby making the stock index product less
readily susceptible to manipulation.\20\ In this regard, CBOE, Amex,
NYSE, and the NASD, on whose markets the component securities of the
Sub-Indexes trade, are all members of the Intermarket Surveillance
Group (``ISG'').\21\ Options on the individual component securities
also trade on markets which are ISG members. In addition, CBOE will
apply the same surveillance procedures as those used for existing
narrow-based index options trading on CBOE.
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\20\ See Securities Exchange Act Release No. 31243 (September
28, 1992), 57 FR 45849 (October 5, 1992).
\21\ The ISG was formed on July 14, 1983 to, among other things,
coordinate more effectively surveillance and investigative
information sharing arrangements in the stock and options markets.
See Intermarket Surveillance Group Agreement, dated July 14, 1983,
amended January 29, 1990. The members of the ISG are the following:
American Stock Exchange; Boston Stock Exchange, Inc.; CBOE; Chicago
Stock Exchange, Inc.; National Association of Securities Dealers,
Inc.; New York Stock Exchange, Inc.; Pacific Stock Exchange Inc.;
and Philadelphia Stock Exchange, Inc. The major stock index futures
exchanges (including the Chicago Merchantile Exchange and the
Chicago Board of Trade) joined the ISG as affiliate members in 1990.
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The Commission notes that certain concerns are raised when a
broker-dealer, such as Goldman, Sachs, is involved in the development
and maintenance of a stock index that underlies an exchange-traded
derivative product. For several reasons, however, the Commission
believes that CBOE has adequately addressed this concern with respect
to options on the Sub-Indexes.
First, the value of the Sub-Indexes, including the final settlement
values, are to be calculated and disseminated independent of Goldman,
Sachs by CBOE. Accordingly, neither Goldman, Sachs nor any of its
affiliates or other persons (except CBOE) will be in receipt of the
values prior to their public dissemination. Second, the Commission
believes that the procedures Goldman, Sachs has established to detect
and prevent material non-public information concerning the Sub-Indexes
from being improperly used by members of the Committee, as well as
other persons within Goldman, Sachs, as discussed above, adequately
serve to minimize the susceptibility to manipulation of the Sub-Indexes
and the securities in the Sub-Indexes. Finally, the Exchange's existing
surveillance procedures for stock index options will apply to the
options on the Sub-Indexes and should provide CBOE with adequate
information to detect and deter trading abuses that may occur. In
summary, the Commission believes that the procedures outlined above
help to ensure that Goldman, Sachs will not have any informational
advantages concerning modifications to the composition of the Sub-
Indexes due to its role in the maintenance of the Sub-Indexes.
D. Market Impact
The Commission believes that the listing and trading of options on
the Sub-Indexes, including LEAPS, on CBOE will not adversely impact the
underlying securities markets.\22\ First, as described above, due to
the modified capitalization weighting method, no one stock or group of
stocks dominates a Sub-Index. Second, because at each semi-annual
rebalancing of a Sub-Index, at least 75% of the weight of the Sub-
Indexes must be accounted for by stocks that meet CBOE's options
listing standards, the component stocks generally will be actively-
traded, highly-capitalized stocks.\23\ Third, CBOE's existing position
and exercise limits will serve to minimize potential manipulation and
market impact concerns. Fourth, the risk to investors of contra-party
non-performance will be minimized because Sub-Index options and Sub-
Index LEAPS will be issued and guaranteed by the OCC just like any
other standardized option traded in the United States.
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\22\ In addition, CBOE has represented that it and OPRA have the
necessary systems capacity to support those new series of index
options that would result from the introduction of Sub-Index options
and LEAPS.
\23\ See Amendment No. 1.
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Lastly, the Commission believes that settling expiring GSTI Sub-
Index options, including LEAPS, based on the opening prices of
component securities is reasonable and consistent with the Act. As
noted in other contexts, valuing options for exercise settlement on
expiration based on opening prices rather than closing prices may help
reduce adverse effects on markets for stocks underlying options on the
Index.\24\
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\24\ Securities Exchange Act Release No. 30944 (July 21, 1992),
57 FR 33376 (July 28, 1992).
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The Commission finds good cause for approving Amendment No. 1 to
the proposed rule change prior to the thirtieth day after the date of
publication of notice of filing thereof in the Federal Register.
Amendment No. 1 establishes maintenance criteria for the Sub-Indexes
which should help to ensure that the Sub-Indexes do not become
dominated by lowly capitalized, illiquid, and thinly traded securities.
In addition, the Commission believes that the establishment of
maintenance criteria should help to increase the integrity and
stability of the Sub-Indexes. Therefore, the Commission believes it is
consistent with Sections 6(b)(5) and 19(b)(2) of the Act to approve
Amendment No. 1 to the proposal on an accelerated basis.
III. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning Amendment No. 1. Persons making written
submissions should file six copies thereof with the Secretary,
Securities and Exchange Commission, 450 Fifth Street, N.W., Washington,
D.C. 20549. 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. Sec. 552, will be available for inspection and
copying at the Commission's Public Reference Section, 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies of such filing will also be
available for inspection and copying at the principal office of the
CBOE. All submissions should refer to File No. SR-CBOE-96-44 and should
be submitted by October 16, 1996.
It therefore is ordered, pursuant to Section 19(b)(2) of the
Act,\25\ that the proposed rule change (SR-CBOE-96-44) is approved, as
amended.
\25\ 15 U.S.C. Sec. 78s(b)(2) (1988).
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For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\26\
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\26\ 17 CFR 200.30-3(a)(12) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-24493 Filed 9-24-96; 8:45 am]
BILLING CODE 8010-01-M
