Equity Options Position Limit Rules

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 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 equity option position limits could have an impact on a FINRA-regulated firm’s compliance with FINRA Rule 2360(b)(3)(A)(i). Accordingly, below 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.

• MIAX-2018-10
  A proposed rule change filed by Miami International Securities Exchange LLC increasing the position limits for options on certain broad-based ETFs (SR-MIAX-2018-10) has been approved by the SEC.
• BOX-2018-10
  A proposed rule change filed by BOX Options Exchange LLC increasing the position limits for options on certain broad-based ETFs (SR-BOX-2018-10) has been approved by the SEC.
• PHLX-2018-24
  A proposed rule change filed by Nasdaq PHLX LLC increasing the position limits for options on certain broad-based ETFs (SR-PHLX-2018-24) has been approved by the SEC.
• CBOE-2017-057
  A proposed rule change filed by Cboe Exchange, Inc. increasing the position limits for options on certain broad-based ETFs (SR-CBOE-2017-057) has been approved by the SEC.
• SR-ISE-2015-05
  A proposed rule change filed by The International Securities Exchange, LLC amending its rules to extend the pilot program that eliminated position and exercise limits for physically-settled options on the SPDR S&P ETF Trust (“SPY Pilot Program”). 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/2015/34-74224.pdf
• SR-CBOE-2015-008
  A proposed rule change filed by Chicago Board Options Exchange, Incorporated amending Interpretation and Policy .07 to Rule 4.11 (Position Limits) to extend a pilot program that eliminates the position and exercise limits for physically-settled options on the SPDR S&P 500 ETF Trust (“SPY Pilot Program”), which is currently set to expire on January 27, 2014.  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/cboe/2015/34-74149.pdf
• SR-BOX-2015-07
  A proposed rule change filed by BOX Options Exchange LLC amending IM-3120-2 to Rule 3120 to extend the pilot program that eliminated the position limits for options on SPDR S&P 500 ETF (“SPY”) (“SPY Pilot Program”). 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/2015/34-74196.pdf
• NASDAQ OMX PHLX-2015-07
  A proposed rule change filed by NASDAQ OMX PHLX LLC extending the pilot program that eliminates position limits for options on the SPDR® S&P 500® exchange-traded fund (“SPY ETF” or “SPY”), which list and trade under the symbol SPY (“SPY Pilot Program”). 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/phlx/2015/34-74099.pdf
• 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