December 4, 2020

Vanessa Countryman
Secretary
Securities and Exchange Commission
100 F Street NE., Washington, DC 20549

Re: Nasdaq BX, Inc.; Notice of Filing of Proposed Rule Change to Amend Options 4, Section 5, to Limit Short Term Options Series Intervals between Strikes Which are Available for Quoting and Trading on BX (File No. SR-BX-2020-032)

Dear Ms. Countryman:

The Securities Industry and Financial Markets Association (“SIFMA”)1 appreciates the opportunity to comment upon the above-referenced rule proposal (the “Proposal”) submitted by Nasdaq BX (“BX” or “Exchange”) with the U.S. Securities and Exchange Commission (“SEC” or “Commission”).2 In the Filing, BX proposes to amend its rules to limit the intervals between strikes for multiply listed equity options classes within BX’s Short Term Options Series (“STOS”) program that have an expiration date more than twenty-one days from the listing date. SIFMA supports BX’s Proposal and believes the Commission should approve it.

SIFMA has long supported a rationalization of the number of options series listed by the options exchanges (i.e., “strikes”) that do not have trading interest and has been frustrated by the exchanges’ inability to work collectively on a harmonized approach to solve this complex issue. SIFMA appreciates the Proposal put forth by BX to modify the listing of weekly options series by limiting the intervals between strikes in multiply listed equity options, excluding ETFs and ETNs, that have an expiration date more than twenty-one days from the proposal. The Proposal does not amend monthly or quarterly strike listings rules, nor does it amend the $1 Strike Price Interval Program, the $0.50 Strike Program, the $2.50 Strike Price Program, or the $5 Strike Program.

BX notes that the weekly program currently comprises a significant part of the standard listings in the options market. The Exchange states that weekly strikes increased 8.9% compound annual growth rate from 2015 to 2020 compared with a 4.3% rate for standard expirations using the 3rd 2015 Friday expiration. BX also highlights, that today, weeklies comprise 16% of the underlying products available for options listing on the Exchange.

Under the Proposal, to determine which strikes should be listed, BX will use a table based on the share price of the underlying security and the average daily volume (“ADV”) of the options contracts on the security over a calendar quarter. The Exchange will use OCC customer-cleared volume for the ADV since it believes this is an appropriate proxy for demand. The Exchange notes that OCC customer-cleared volume represents most of the contracts executed on the Exchange, which in turn reflects the demand in the marketplace.

1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly 1 million employees, we advocate for legislation, regulation and business policy, affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA). For more information, visit http://www.sifma.org.

2 See Release No. 34–90384 (November 9, 2020), 85 FR 73113 (November 16, 2020).