The eRulemaking Program

06/11/2025 | Press release | Distributed by Public on 06/12/2025 06:45

Self-Regulatory Organizations; Proposed Rule Changes: Cboe EDGX Exchange, Inc.

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103205; File No. SR-CboeEDGX-2025-046]

Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Opening Process for Simple Orders in Exclusively Listed Index Option Classes

June 6, 2025.

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 May 27, 2025, Cboe EDGX Exchange, Inc. (the "Exchange" or "EDGX") filed with the Securities and Exchange Commission (the "Commission") the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

Cboe EDGX Exchange, Inc. (the "Exchange" or "EDGX Options") proposes to amend its opening process for simple orders in exclusively listed index option classes. (3) The text of the proposed rule change is provided in Exhibit 5.

The text of the proposed rule change is also available on the Exchange's website ( http://markets.cboe.com/us/options/regulation/rule_filings/edgx/ ), 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 Exchange 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 these statements may be examined at 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 aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change

1. Purpose

The Exchange proposes to amend Rule 21.7 regarding its opening process for simple orders for products it may exclusively list on the Exchange.

Current Standard Opening Process

Currently, following the occurrence of an opening rotation trigger pursuant to Rule 21.7(d), the System conducts an opening rotation for an option series. Following the opening rotation trigger, the System conducts the Maximum Composite Width Check pursuant to Rule 21.7(e)(1) to determine if a series is eligible to open. If the Composite Market  (4) of a series is not crossed, and the Composite Width  (5) of the series is less than or equal to the Maximum Composite Width (as defined in Rule 21.7 (a)), the series is eligible to open. Additionally, if the Composite Market of a series is not crossed, and the Composite Width of the series is greater than the Maximum Composite Width, but there are (i) no non-M Capacity  (6) (a) market orders or (b) buy (sell) limit orders with prices higher (lower) than the Composite Market midpoint and (ii) no orders or quotes marketable against each other, the series is eligible to open. Once a series become eligible to open, the System conducts the opening auction for the series ( i.e., determines the opening trade price pursuant to Rule 21.7(e)(2) and opens the series pursuant to Rule 21.7(e)(3)). The Exchange may also determine to compel a series to open in the interest of fair and orderly markets, including if the opening width is wider than the Maximum Composite Width, pursuant to Rule 21.7(h).

Currently, if a series cannot satisfy these conditions described above (and thus is not eligible to open), if there is no Composite Market, or if the Composite Market of a series is crossed, the series is ineligible to open. (7) When that occurs, the Queuing Period  (8) for the series continues (including the dissemination of opening auction updates) until (i) the Maximum Composite Width Check is satisfied and the Composite Market is not crossed; (ii) there are (a) no non-M Capacity (x) market orders or (y) buy (sell) limit orders with prices higher (lower) than the Composite Market midpoint and (b) no orders or quotes marketable against each other if the Maximum Composite Width is not satisfied and the Composite Market is not crossed, or (iii) t the Exchange determines to open the series pursuant to Rule 21.7(h). As described further herein, the Exchange may now manually increase the prescribed Maximum Composite Width during the Queuing Period in order to open up an exclusively listed option series. (9)

Current Forced Opening Procedures for Equity and ETP Option Classes

However, currently, if a series in an equity or ETP option class is unable to open because it does not satisfy the Maximum Composite Width Check within an Exchange-designated time period (and (i) the Composite Market is not crossed and (ii) no non-M Capacity order crosses the Composite Market midpoint)  (10) the System forces the series to open after that time period upon the System's observation of an ABBO  (11) (with a non-zero offer) for the series. (12)

Background on the Current Opening Procedures for Exclusively Listed Options

As mentioned above, and as described further herein, the Exchange may now manually force open a series that does not satisfy the Maximum Composite Width by increasing the prescribed Maximum Composite Width during the Queuing Period in order to open up a series. (13) The Exchange currently exercises more discretion through this manual process then it would through the proposed automated process as it must manually review which series are not open and can determine whether it wants to force the series open. In neither the existing process nor in the proposed automated process through the proposed modified forced open rule is there are an ABBO looked to (as it does not exist).

However, under the existing manual process to increase the Maximum Composite Width, if there are no Market Maker orders, and thus no Composite Width for the Exchange to manually increase, a series will not open, unless the Exchange deems it necessary for fair and orderly markets and opens a series pursuant to Rule 21.7(h). The new rule proposes that a forced open shall occur if there is no Composite Market so long as there are no non-M Capacity orders that are crossed. As described in further detail below, the Exchange believes this is in the best interest of market participants, as it is the case for some Market Makers that they may not provide on-screen liquidity until after they receive the opening trigger notification. (14) For these reasons, the Exchange believes it is in the best interest to open up these series even if no Composite Market exists and no non-M Capacity orders are crossed.

The Exchange also notes that it may use Rule 21.7(h) to deviate from the standard opening process, including: (i) adjusting the timing of the opening rotation in any option class, (ii) modifying any time periods described in Rule 21.7, and (iii) compelling a series open, even if the Maximum Composite Width check is not satisfied, but these events may only happen manually if the Exchange determines it is necessary in the interests of a fair and orderly market. The Exchange notes that it will retain this authority still under the new proposed forced opening rule.

Proposed Forced Opening Procedures for Exclusively Listed Options

The proposed rule change expands the existing forced opening provision to now apply to exclusively listed option series, except that (i) the ABBO will not be used as a triggering factor to open a series as there is no ABBO for the exclusively listed option series and (ii) the series may open if there is no Composite Market so long as there are no non-M Capacity orders that are crossed. Similar to equity or ETP option classes, the series will not open if the Composite Market is crossed or if there are non-M Capacity orders that cross the Composite Market midpoint.

Specifically, as proposed, if a series in an exclusively listed option class is unable to open because it does not satisfy the Maximum Composite Width Check described above within a time period (which the Exchange determines for exclusively listed options  (15) ) after the occurrence of the opening rotation trigger for the class pursuant to Rule 21.7(d), and (i) the Composite Market is not crossed and no non-M Capacity order crosses the Composite Market midpoint or (ii) there is no Composite Market and there are no non-M Capacity orders that are crossed, the System forces the series to open after that time period. For a series subject to a forced opening, the opening trade price determination and series open set forth in Rule 21.7(e)(2) and (3) ( i.e., the opening auction) do not occur; instead, the System opens the series without a trade. This will permit a series to open for trading on the Exchange even though the market for the series on the Exchange may be wide (or if there are no quotes or orders on the book). (16) As described above, the two primary distinctions between the existing manual process that is used to manually open exclusively listed options, where the Maximum Composite Width is manually widened, and the proposed forced opening process for exclusively listed options, are (i) the proposed automated process is more efficient and transparent process and (ii) an exclusively listed option series may still open even if there is no Composite Market so long as no non-M Capacity orders are crossed. However, as previously noted, the Exchange may also open up a series if it deems so necessary in the interest of a fair and orderly market pursuant to Rule 21.7 (h).

If a series satisfies the Maximum Composite Width Check prior to the end of the Exchange-determined time period, the series opens pursuant to Rule 21.7(d)(2) and (3) ( i.e., the standard opening auction process occurs for the series). For example, suppose the Exchange determined the "forced opening" timer for exclusively listed option series to be three minutes. If the opening trigger for an exclusively listed option series occurs at 9:30:05 Eastern time but the series does not satisfy the Maximum Composite Width Check after the trigger, the System will force the series open after 9:33:05 Eastern time. However, if the series satisfies the Maximum Composite Width Check at 9:32:30, the series will open at that time in accordance with the normal opening auction process. The current rule still allows the market to open even if the market is wide by (i) manually increasing the Maximum Composite Width  (17) or (ii) allowing the series to open in accordance with Rule 5.31(e)(1)(B), which allows the series to open if the Composite Market of a series is not crossed, and the Composite Width of the series is greater than the Maximum Composite Width, but there are (i) no non-M Capacity (a) market orders or (b) buy (sell) limit orders with prices higher (lower) than the Composite Market midpoint and (ii) no orders or quotes marketable against each other.

No ABBO Requirement for Exclusively Listed Options

Given the current method of manually increasing the Maximum Composite Width as a way to force a series open if it does not satisfy the Maximum Composite Width, the Exchange believes the proposed rule is a better alternative to open up a series for trading, as it allows for greater transparency and clearer expectations for market participants, as well as taking away the possibility of error from manual human intervention. As described further herein, the ABBO is not a requirement for the standard opening process for any option classes, including equity and ETP option classes. Specifically, if no away markets are open in a series, there would be no ABBO for that series and thus the Composite Market for the series (and thus whether the series would open) would be based solely on the Exchange's market for the series. Further, if the ABBO is wider than the Exchange's market for a series, the ABBO is also not a factor into whether the System opened the series. In those cases, whether an equity or ETF option series satisfied the Maximum Composite Width check would be based solely on the Exchange's market. With respect to the forced opening process for equity and ETP option classes, it may even be the case that the ABBO is wider than the Exchange's market.

Differences Between the Forced Opening Process for Equity and ETP Option Classes and the Proposed Process for Exclusively Listed Options

The Exchange notes that it previously adopted a similar process to force an open for series in an equity or exchange-traded product option classes. (18) The only substantive differences within these two processes is that (i) the process for exclusively listed options will not rely on the additional requirement that the system observes an ABBO after the designated time period passes since exclusively listed options will not have an ABBO as the products are not listed on any other exchange and (ii) exclusively listed option series may open if there is no Composite Market so long as there are no non-M Capacity orders that are crossing.

With the exception that there is not an ABBO that may be looked at first and that a Composite Market is not required to exist (so long as there are no non-M Capacity orders that are crossed), all other protections that were put into place during the inception of the forced open for equity and ETP classes will also apply to the proposed forced open for exclusively listed options. Rule 21.7(f) provides that in the event of a forced opening of a series pursuant to proposed Rule 21.7(e)(4) or a compelled opening of a series pursuant to paragraph (h), the System enters all of a User's orders in that series in the Queuing Book  (19) into the Book in the manner set forth in current Rule 21.7(f), unless a User instructs the System to cancel its market orders or all of its orders, in which case the System enters only the non-cancelled orders into the Book in this manner. Specifically, they will be processed in accordance with Rule 21.8 (as unexecuted orders and quotes are handled following the conclusion of the opening rotation), which describes how the System processes, handles, and executes orders. If any order or quote in the Queuing Book is marketable upon the forced opening (and the User does not instruct the System to cancel it as proposed), the System would execute marketable orders subject to the priority rules set forth in Rule 21.8. Any non-marketable order would enter the Book or cancel, subject to the User instructions. This proposed change provides Users with flexibility for automated handling of their orders in the event an exclusively listed option series opens with a wide market opposed to the existing manual process where the Exchange manually increases the Maximum Composite Width to force an open. (20)

2. Statutory Basis

The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the "Act") and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act. (21) Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5)  (22) requirements that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5)  (23) requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers.

In particular, the Exchange believes the proposed forced opening process for simple orders in its exclusively listed option series will remove impediments to and perfect the mechanism of a free and open market and a national market system and protect investors. The proposed rule change will provide for a series to open for trading on the Exchange sooner than it may automatically open currently. The Exchange believes the proposed rule change will benefit investors, because it may permit these options to open sooner and increase the times during which investors may conduct trading in these options, allowing participants to trade, hedge exposure, and exit positions in a timely manner. While the width of Market-Maker quotes on the Exchange (and thus the Composite Width) for an exclusively listed option series may be wider than the Maximum Composite Width  (24) or, no Market-Maker quotes for an exclusively listed option series are present in the book (and thus there is no Composite Market for the series), the Exchange believes it is reasonable to open the series after a certain amount of time has passed. The Exchange further notes that it does not believe wide Market Maker quotes in and of itself is an adequate reason to delay the opening, as that may occur at any time during the trading day. The Exchange understands from customers they would prefer to be able to begin trading the Exchange's exclusively listed index options without undue delay, even in a wide market, in a timeframe more closely aligned with equities and ETP options  (25) (there have been delays as long as ten to fifteen minutes after markets open). A delayed opening may leave participants unable to efficiently hedge, exit, and otherwise manage positions as needed, particularly because the value of the index may be changing given that the stocks comprising the index are open for trading. As a result, a delayed opening may create more investment risk for market participants than opening with a market comprised of wide or no Market-Maker quotes (which as noted above, is a market condition that may occur at any time). Additionally, the proposed ability of Users to cancel orders in the event of a forced opening will provide Users with additional protection.

As discussed above, the Exchange currently has the authority, when it deems necessary, to deviate from the standard opening process, including: (i) adjusting the timing of the opening market rotation in any option class, (ii) modifying nay time periods described in Rule 21.7, and (iii) compelling a series open, even if the Maximum Composite Width check is not satisfied, but these events may only happen manually if the Exchange determines it is necessary in the interests of a fair and orderly market. (26) The proposed rule change is consistent with the authority granted under Rule 21.7(h). Furthermore, this proposed rule change creates an automated compelled opening in certain circumstances by not needing to rely on the manual process of increasing the Maximum Composite Width that may currently be used under the definition of Maximum Composite Width under Rule 21.7(a), with the exception that a series may be forced open under this proposed rule even if no Composite Market exists, so long as there are no non-M Capacity orders crossed. This will benefit investors by providing additional transparency to the Rules regarding when a series may open despite not satisfying the Maximum Composite Width check as well as remove impediments to and perfect the mechanism of a free and open market and a national market system by automating an otherwise manual process. Furthermore, the Exchange believes it is in the best interest of investors to allow an exclusively listed option series to open even if there is no Composite Market, so long as no non-M Capacity orders are crossed. This continues to protect customer orders from executing at the open at a potentially erroneous price given that the requirement that there be no non-M Capacity orders crossed. By allowing these markets to open in a timely manner, market participants would be able to have their orders filled and manage their existing positions earlier, thus reducing potential investment risk associated with further delaying the open.

Further, as discussed above, the Exchange believes it is in the best interest of market participants to allow the Exchange discretion to determine a different time period for its exclusively listed options that may be different from the time period for its equity and ETP options. As noted, there are differences between these groups, notably, that exclusively listed options may also trade during the GTH trading session. Further, under Rule 21.7(h), the Exchange already has the authority to adjust any time periods under Rule 21.7, which include the forced open timers, when it deems necessary for a fair and orderly market. The Exchange proposes to make this discretion clear within the proposed rule, where the Exchange may have different timers for (i) equity and ETP options and (ii) exclusively listed options.

Additionally, by establishing this process instead of manually increasing the Maximum Composite Width, the Exchange believes this provides greater transparency and clarity and better sets out expectations for participants. The Exchange notes that it still maintains its existing authority under Rule 21.7(h) to deviate from the standard manner of the opening auction process. The Exchange does not think that not having an ABBO (as none exists for exclusively listed options) is of note, as the Exchange manually forces an open now by increasing the Maximum Composite Width and an ABBO is not required under that procedure. Of further note, the ABBO is not a requirement for the standard opening process for any option classes, including equity and ETP option classes. Specifically, if no away markets are open inequity or ETP options, there would be no ABBO for that series and thus the Composite Market for the series (and thus whether the series would open) would be based solely on the Exchange's market for the series. Further, if the ABBO is wider than the Exchange's market for a series, the ABBO is also not a factor into whether the System opened the series. In those cases, whether an equity or ETF option series satisfied the Maximum Composite Width check would be based solely on the Exchange's market.

Further, as previously discussed, the Exchange believes it furthers its goal of conducting fair and orderly markets by forcing its exclusively listed options to open if there is no Composite Market. In the event there is no Composite Market from there being no on-screen two-sided market from Market Maker bids and offers, and there are no non-M Capacity orders that are crossed, the Exchange believes it would benefit the market to move forward with opening, so customers may commence trading. As described above, the Exchange understands from market participants they would rather commence trading to manage their positions even if there are wide, or no, Market-Maker quotes on the book. Additionally, as previously noted the Exchange's affiliated options exchange, Cboe Exchange, Inc. generally has a strong floor presence for exclusively listed options, and it may be the case while there is no Composite Market on screen, that there are Market Makers on the floor that can fill customer orders. The Exchange and its affiliated options exchanges are all proposing to modify its existing forced opening procedures to include exclusively listed options.

B. Self-Regulatory Organization's Statement on Burden on Competition

The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed rule change will impose any burden on intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because all Users may trade in any exclusively listed option series that opens subject to the proposed forced opening process. The proposed forced opening process for exclusively listed option series is also substantially similar to the current forced opening process for equity and ETP option series, with the exception that, (i) there is no ABBO for exclusively listed option series, and thus, is not a step in the forced opening process for the exclusively listed option series as described above and (ii) a Composite Market is not required for exclusively listed options, as described above. Additionally, all Users will have the opportunity to instruct the System to cancel its market orders or all open orders in the event of a forced or otherwise manual opening. Cancellation of some or all of a User's orders in the event of such an opening would be voluntary and completely within the User's discretion.

The Exchange does not believe that the proposed rule change will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because the proposed rule change updates the opening process for exclusively listed options that may trade only on the Exchange. As discussed above, the proposed rule change will allow participants to begin trading, hedging exposure, and exiting positions in exclusively listed options in a timely manner, consistent with the timing and process the Exchange currently uses for equity and ETP options. The proposed flexibility for Users to instruct the System how to handle their orders in the event of a forced or manual opening applies only to how Users' orders on the Exchange will be handled in such a circumstance.

C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others

The Exchange neither solicited nor received comments on the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action

Because the foregoing proposed rule change does not:

A. significantly affect the protection of investors or the public interest;

B. impose any significant burden on competition; and

C. become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act  (27) and Rule 19b-4(f)(6)  (28) thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend 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. If the Commission takes such action, the Commission will institute proceedings to determine whether the proposed rule change should be approved or disapproved.

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 ( https://www.sec.gov/rules/sro.shtml ); or

• Send an email to rule-comments@sec.gov. Please include file number SR-CboeEDGX-2025-046 on the subject line.

Paper Comments

  • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-CboeEDGX-2025-046. This file number should be included on the subject line if email 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 website ( https://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 website viewing and printing 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. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to file number SR-CboeEDGX-2025-046 and should be submitted on or before July 3, 2025.

For the Commission, by the Division of Trading and Markets, pursuant to delegated authority. (29)

Vanessa A. Countryman,
Secretary.
[FR Doc. 2025-10644 Filed 6-11-25; 8:45 am]
BILLING CODE 8011-01-P

Footnotes

(1)  15 U.S.C. 78s(b)(1).

(2)  17 CFR 240.19b-4.

(3)  An "exclusively listed option" is an option that may trade exclusively on an exchange (and its affiliated exchange) because the exchange has an exclusive license to list and trade the option or has the proprietary rights in the interest underlying the option. An exclusively listed option is different than a "singly listed option," which is an option that is not an "exclusively listed option" but that is listed by one exchange and not by any other national securities exchange.

(4)  The term "Composite Market" means the market for a series comprised of (1) the higher of the then-current best appointed Market-Maker bulk message bid on the Exchange and the away best bid ("ABB") (if there is an ABB) and (2) the lower of the then-current best appointed Market-Maker bulk message offer on the Exchange and the away best offer ("ABO") (if there is an ABO). The term "Composite Bid (Offer)" means the bid (offer) used to determine the Composite Market. See Rule 21.7(a).

(5)  The term "Composite Width" means the width of the Composite Market ( i.e., the width between the Composite Bid and the Composite Offer) of a series. See Rule 21.7(a).

(6)  A non-M Capacity order is a non-Market Maker order. See Rule 16.1, definition of Capacity for a list of other Capacities that may be attached to an order.

(7) See Rule 21.7(e)(1)(C).

(8)  The term "Queuing Period" means the time period prior to the initiation of an opening rotation during which the System accepts orders and quotes in the Queuing Book (the book into which Users may submit orders for participation in the opening rotation) for participation in the opening rotation for the applicable trading session. See Rule 21.7(a).

(9) See the definition of Maximum Composite Width, which permits the Exchange to modify the Maximum Composite Width during the opening auction process (which modifications the Exchange disseminates to all subscribers via the Exchange's data feeds that deliver opening auction updates) in Rule 21.7(a).

(10)  The Exchange proposes to modify the existing forced open rule for equity and ETP option classes to clarify that it will not force the open if there are non-M Capacity orders that cross the Composite Market midpoint. While the Exchange currently follows this process, it proposes to make this clear in its rule as well.

(11)  The term "ABBO" means the best bid(s) or offer(s) disseminated by other Eligible Exchanges (as defined in Rule 27.1(a)(7)) and calculated by the Exchange based on market information the Exchange receives from OPRA. See Rule 16.1.

(12) See Rule 21.7(e)(4).

(13) See the definition of Maximum Composite Width, which permits the Exchange to modify the Maximum Composite Width during the opening auction process (which modifications the Exchange disseminates to all subscribers via the Exchange's data feeds that deliver opening auction updates) in Rule 21.7(a).

(14)  Of further note, the Exchange's affiliated options exchange, Cboe Exchange, Inc. ("Cboe Options"), generally has a strong floor presence for exclusively listed options, and it may be the case while there is no Composite Market on screen, that there are Market Makers on the floor that can fill customer orders. The Exchange and its affiliated options exchanges are all proposing to modify its existing forced opening procedures to include exclusively listed options.

(15)  The proposed rule change permits the Exchange to determine a different time period for all exclusively listed options than the time period determined for equity and ETP classes.

(16)  The Exchange notes that a wide market is not a reason enough for not opening as a wide market may occur at any point during the trading day. As described further herein, it is more of a risk for participants to keep the market closed, preventing participants from managing their position exposure as other markets are already open.

(17) See supra note 13.

(18) See Securities Exchange Act Release No. 90969 (January 22, 2021), 86 FR 7433 (January 28, 2021) (SR-CboeEDGX-2021-005).

(19)  The term "Queuing Book" means the book into which Users may submit orders and quotes (and onto which GTC and GTD orders remaining on the Book from the previous trading session or trading day, as applicable, are entered) during the Queuing Period for participation in the applicable opening rotation. Orders and quotes on the Queuing Book may not execute until the opening rotation. The Queuing Book for the GTH opening auction process may be referred to as the "GTH Queuing Book," and the Queuing Book for the RTH opening auction process may be referred to as the "RTH Queuing Book. See Rule 21.7(a).

(20) See supra note 13.

(21)  15 U.S.C. 78f(b).

(22)  15 U.S.C. 78f(b)(5).

(23) Id.

(24)  The Exchange notes pursuant to 21.7(e)(1)(B), there are currently instances in which the Exchange will open for trading despite the Composite Market Width being larger than the Maximum Composite Width.

(25) See Rule 21.7(e)(4).

(26) See Rule 21.7(h); see also definition of Maximum Composite Width and Opening Collar in Rule 21.7(a).

(27)  15 U.S.C. 78s(b)(3)(A).

(28)  17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement.

(29)  17 CFR 200.30-3(a)(12).

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