Cboe has received approval to amend its rules for Cboe Options Exchange (C1) to expand trading hours for designated multi-listed equity options. The changes involve the addition of an early morning Global Trading Hours (GTH) session and an after-market Curb session. Cboe's rule change will reflect the following trading sessions for select multi-listed equity options meeting certain criteria:

Read frequently asked questions about designated Option symbol list/Option classes.

1. Which equity option classes will be eligible for trading during the GTH and Curb sessions?

   Select equity options would be eligible to trade during the new sessions if:

   • the option class has an average daily volume of 150,000 contracts or higher,

   • the underlying equity to the option has a $50 billion or higher market capitalization, and

   • the underlying equity to the option has an average daily trading volume of 10 million shares or higher.

   Cboe proposes to limit the number of equity option classes that may be designated for the GTH and Curb sessions to 100 option classes. The intent is to monitor and assess the development and functioning of GTH and Curb markets for equity options within a limited group of equity options initially.

2. How often would Cboe update or re-balance the list of equity option classes designated for trading in the GTH and Curb sessions?

   The class list will be re-balanced twice per year. The list will be based on data from July 1 through December 31, and again based on data from January 1 through June 30, similar to the re-balance schedule for the penny program and the cash-settled ETF program.

3. How and when would Cboe communicate changes to the list of eligible equity option classes? Will they be utilizing the real time information dissemination system to which market makers already subscribe?

   Equity option classes added to or removed from the GTH and Curb sessions will be announced in advance via Exchange Notice, similar to the penny program and the cash-settled ETF program.

4. If other equity option classes are traded on another exchange during overlapping GTH and Curb sessions, do these classes count towards the 100-name limit? Is there any limit on the number of non-Cboe listed equity option classes that could be eligible to trade on Cboe during the new GTH and Curb sessions?

   The Cboe rule caps the total number of equity option classes that Cboe may select at 100. Cboe chose criteria that would allow only premier companies of the highest quality, market cap, options/equity trading volume, etc. If other exchanges copy Cboe's qualification standards, the criteria would yield the exact same list of eligible companies and ensure names like meme stocks with temporary high volume or market cap are not eligible.

   However, if another exchange were to have different criteria and selected more than 100 equity option classes for GTH and/or Curb, Cboe may list those options, and such options selected in this manner would not count towards Cboe's 100 limit. It would be Cboe's choice whether to match other exchanges' lists. Cboe cannot predict whether the Securities and Exchange Commission will require competitors to match our qualification standards.

5. Where can the current list of GTH and Curb eligible underlying symbols be found?

   The current list of GTH and Curb eligible underlying symbols can be found in the Cboe Options Underlying Reference Data file. GTH eligible underlying symbols will be marked with a 'Y' in the "GTH Eligible" column and Curb eligible underlying symbols will be marked with a 'Y' in the "Curb Eligible" column. All series for an eligible underlying will be available to trade in GTH and Curb.

   • Certification Underlying Reference Data

   • Production Underlying Reference Data

6. When will GTH-eligible equity option series be reflected in reference data and symbol files, and how much lead time should firms expect before a new GTH session begins?

   There is no change from the timing that occurs today when new series are added overnight. Symbol definition messages for these series are sent as soon as the series are received and processed from the OCC. This typically occurs between 9:00 and 10:00 p.m. ET, but could vary based on OCC or Cboe processing time.

7. Does Cboe's GTH and Curb listing criteria encompass all option series within a single equity option class, including Monday and Wednesday expirations?

   Yes. The standards for eligibility are set forth in the GTH filing, and existing Cboe rules permitting Monday/Wednesday expirations will be applicable to single equity option classes. All series within an option class for a GTH-eligible symbol will be available for trading.

8. How will GTH/Curb session eligibility be handled for IPOs?

   Cboe originally included a provision in its initial proposed rule language that would have permitted accelerated GTH/Curb qualification for initial public offerings (IPOs), rather than having to wait for the next semi-annual qualification window. However, Cboe has since removed this provision to simplify GTH/Curb eligibility handling in alignment with its conservative approach to extending trading hours.

Read frequently asked questions about the opening process.

Read frequently asked questions related to market maker quoting obligations, including differences between trading sessions, handling of volatility, and the role of Trading Permit Holders.

1. Will market maker obligations be the same for RTH and the new GTH session? If not, how will they differ?

   Cboe intends for similar market maker requirements to apply across all trading sessions.

2. If volume is reduced and spreads are wider during the new GTH session, how will this affect market maker quoting obligations?

   Market maker continuous quoting obligations across all sessions will include a provision to allow quoting as wide as the underlying for ITM series.

3. Will market maker quoting obligations remain the same during periods of heightened volatility? For example, today there is no codified requirement to say what quotes should be,rather a best practice framework – will this remain the same?

   Cboe plans to add maximum market maker quote width requirements to its rules, with expected implementation sometime after the initial SSO GTH implementation, date TBD. On volatile days,the Exchange may grant maximum quote width relief. The Exchange may also grant relief with respect to opening collar widths.

4. How will Cboe handle trading in the designated equity options during the new GTH and Curb sessions to account for potential surges in volume based on news events or key economic announcements(jobs reports, inflation data)?

   Cboe systems and market makers have proven more than adequate to accommodate high-volatility and high-volume trading. The Exchange also has various systematic mechanisms to protect market makers and other market participants. Additionally, market orders will not be actionable during the GTH or Curb sessions, as is the case with the existing GTH session for select Cboe proprietary index classes.

5. Can Trading Permit Holders (TPH) choose to act as market makers during the RTH session but not during GTH sessions?

   Yes. However, it is anticipated that Cboe will have a GTH Designated Primary Market Maker (DPM) for each class that trades during GTH. This DPM may differ from the RTH DPM in cases where the RTH DPM declines the role during GTH.

Read frequently asked questions related to regulatory obligations and considerations for trading sessions, including the application of Cboe rules and Reg SHO requirements.

1. Regarding the inter market linkage and application of trade through/locked-cross prohibition, would Cboe Rules 5.65, 5.66, and 5.67 apply during the new GTH hours?

   Cboe rules on this point are the same during GTH and RTH. Cboe systematically prevents locked/crossed markets and will also have inter-exchange linkage available to route marketable orders to better-priced away exchanges, just as during RTH.

2. Start of day positions must be accurate to correctly calculate short and long positions in support of Reg SHO. If clearing firm files, including contrary assignments, are delayed, start-of-day positions could be impacted, leading to potential mis-marking or other issues. To reduce this risk, has Cboe discussed with the OCC and clearing firms the need to provide all files on the same day?

   Yes, Cboe has discussed this with the OCC and market maker clearing firms. Most of those clearing firms have said their systems complete such processing on the current trading day, well before midnight. Cboe's proposed GTH start time of 7:30 a.m. ET was not a concern for most clearing firms. Specifically, for Reg SHO Buy-Ins, in the case of technical issues such as missing data files, clearing firms would typically manually adjust fail allocations. Some have also stated they proactively monitor their fail to delivers intraday on settlement day to address root causes and minimize fail situations. Cboe encourages market makers to have additional discussions directly with their clearing firm on this point.

Read frequently asked questions related to the coordination efforts between Cboe and third-party market participants.

The Options Clearing Corporation (OCC)

1. Has Cboe started (or have plans) to work with the other exchanges that expand trading hours to harmonize treatment of corporate actions across exchanges?

   This is an issue equity and options markets are currently exposed to, even during RTH. The topic was raised by Cboe and others early in the consideration of equity options GTH. Advanced announcement must be available to the OCC, and subsequent notification of the action from the OCC is required to ensure that markets are well-served and operating effectively. Events last year surrounding a late announcement of a special dividend during RTH underscores the importance of addressing this for both the equity and options markets. A recent market participant white paper also raised the need for proper handling of corporate action notification.

   Cboe would support a requirement that certain corporate actions be announced a minimum of 24 hours in advance. We recognize there may be special circumstances with dividends for ETFs due to distributions, but for the single-stock equity names that may be designated by Cboe for trading in the new GTH and extended RTH sessions, mandatory advanced notice seems reasonable. Cboe has been deeply engaged with OCC, SIFMA, and directly with its customers and TPHs on this topic. We will continue to work with these groups and recognize the need for the industry to rally around this topic, noting the role of the listing exchanges on this matter. This topic was discussed at recent LOMSWG meetings, with SIFMA represented. We will continue to facilitate further with the broader industry groups and organizations.

2. Will TPHs be required to get an additional letter of guarantee from the OCC to participate in the new GTH and Curb sessions? Or will existing letters be sufficient?

   OCC and Cboe currently require special authorization for firms to trade during GTH. Further, Cboe will not authorize GTH eligibility for any firm that is not so authorized by OCC. Current GTH authorization procedures at OCC and Cboe cover index and equity options collectively. Thus, a firm that is already eligible to trade index options during GTH will not require any further authorizations to trade applicable equity options during GTH. Those firms that are not currently eligible for GTH will have to receive authorization from OCC and Cboe in order to trade during GTH. OCC and Cboe agree that eligibility to trade during the Curb session is granted by Regular Trading Hours eligibility and does not require special authorization.

3. How will TPHs and other market participants manage any delays in file processing times at OCC or clearing firms – or other processing delays outside their control – given that the windows of non-trading hours will be reduced under the Proposal?

   Cboe had discussions with OCC and the major clearing firms regarding this. The proposed after-market session extends trading only 15 minutes until 4:15 p.m. ET and is no later than the RTH hours for some index and ETF options. Other Cboe index products currently trading during extended hours have a close time of 5:00 p.m. ET. As such, this extension of trading hours is not expected to have any impact on existing processes. The proposed early session for equity options will begin at 7:30 a.m. ET, two hours earlier than RTH. OCC and clearing firms have indicated that their EOD processes are designed to complete on the same business day, well before midnight. In such cases, the two-hour extension of early trading hours would not have any impact. However, Cboe has heard of real-world examples where market makers may not have received all of their positions even by the start of the next RTH session. Cboe will continue discussions with clearing agents on this point and encourages market makers and others to continue dialogue with their clearing firms on this point.

4. Will TPHs that are clearing members be required to post additional capital at OCC to participate in the new GTH sessions?

   The OCC has confirmed that it will propose changes to its extended trading hours procedures to accommodate the change in GTH. The 7:30 a.m. ET to 9:25 a.m. ET session would be subject to OCC's extended trading hours procedures, including the existing 10% capital requirement, capped at $10 million to qualify for GTH.  OCC would consider single-name trading through 4:15 p.m. ET as occurring in regular trading hours, whether treated as an extension of RTH or as a separate Curb session.  All provisions remain subject to regulatory review and approval.

5. How will margin calls be handled during the new GTH and Curb sessions?

   Cboe seeks further feedback from OCC, clearing firms, and brokers on this topic. Cboe anticipates that margin processes would be minimally impacted given the modest extension of pre-RTH trading hours and not impacted at all by the 15-minute extension of post-RTH trading hours.

Options Price Reporting Authority (OPRA)

1. Will OPRA charge or apply new or separate fees or policies for access or use of options transaction and quotation information provided by OPRA during the new GTH sessions?

   Cboe has been informed that OPRA will use existing OPRA RTH lines with no additional fees or policies related to the new GTH sessions.

2. Since the new GTH session will operate during OPRA's hours of operation as defined in Section 5.3 of the OPRA Plan, will OPRA continue to use 96 multicast lines to distribute options transaction and quotation information during the new GTH session?

   Yes, Cboe has been informed that OPRA will continue to use the existing 96 channels to distribute quote and trade data for options defined in the Proposal through the existing OPRA RTH platform. Cboe proprietary index options, like SPX, VIX, XSP, and RUT, will quote and trade on the OPRA GTH system during GTH hours. OPRA recipients will need to update their systems to handle options products trading on both OPRA systems during the 7:30 a.m. to 9:25 a.m. ET GTH trading hours.

3. Will there be any data available in the OPRA Certification System?

   Yes, Cboe is sending quotes and trades to the OPRA RTH Certification system for options series in underlying symbol TSLA. This is available now and will continue to be available after the production launch.