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Federal Register / Vol. 86, No. 129 / Friday, July 9, 2021 / Notices
MPV in the series changes overnight, the option contract expires, or a corporate action results in an adjustment to the terms of the option contract. The Exchange does not offer the GTC Modifier on its cash equity market, and this proposed rule uses Pillar terminology to offer the same functionality that is currently described in Rule 6.62On as the Good-TillCancelled GTC Order without any substantive differences.
Auction-Only Orders. Proposed Rule 6.62POc would define an AuctionOnly Order as a Limit Order or Market Order that is to be traded only in an Auction pursuant to Rule 6.64PO,27
which is text based on Rule 7.31Ec.
The proposed rule would further provide that an Auction-Only Order would not be accepted when a series is opened for trading and any portion of an Auction-Only Order that is not traded in a Core Open Auction or Trading Halt Auction would be cancelled. This represents current functionality and is based in part on the last sentence of Rule 7.31Ec1, the last sentence of Rule 7.31Ec2, and the last sentence of Rule 6.62Or, which defines an Opening Only Order.
Proposed Rule 6.62POc1 would define a Limit-on-Open Order LOO
Order as a Limit Order that is to be traded only in an Auction. This proposed rule uses Pillar terminology based on Rule 7.31Ec1 to describe functionality that would be no different from current functionality, as described in Rule 6.62Or.
Proposed Rule 6.62POc2 would define a Market-on-Open Order MOO
Order as a Market Order that is to be traded only in an Auction. This proposed rule uses Pillar terminology based on Rule 7.31Ec2 to describe functionality that would be no different from current functionality, as described in Rule 6.62Or.
Proposed Rule 6.62POc3 would define an Imbalance Offset Order IO
Order. The Exchange currently offers an IO Order for participation in Trading Halt Auctions on its cash equity market but does not offer this order type for options trading on the OX system. For cash equity trading, the IO Order is a conditional order type that is eligible to participate in a Trading Halt Auction only if it would offset the imbalance.
For options trading on Pillar, the Exchange proposes to offer the IO Order for both Core Open Auctions and Trading Halt Auctions.
As proposed, the IO Order would function no differently than how an IO
27 See discussion infra, regarding proposed Rule 6.64P and definitions relating to Auctions.

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Order currently functions on the Exchanges cash equity market.
Accordingly, proposed Rule 6.62P
Oc3 would define an IO Order as a Limit Order that is to be traded only in an Auction, which is based in part on Rule 7.31Ec5.
Proposed Rule 6.62POc3A
would provide that an IO Order would participate in an Auction only if: 1
There is an Imbalance in the series on the opposite side of the market from the IO Order after taking into account all other orders and quotes eligible to trade at the Indicative Match Price; and 2
the limit price of the IO Order to buy sell would be at or above below the Indicative Match Price. This proposed text is based on Rule 7.31Ec5B
without any substantive differences.
Proposed Rule 6.62POc3B
would provide that the working price of an IO Order to buy sell would be adjusted to be equal to the Indicative Match Price, provided that the working price of an IO Order would not be higher lower than its limit price. This proposed text is based on Rule 7.31
Ec5C without any differences.
Orders with a Conditional or Undisplayed Price and/or Size.
Proposed Rule 6.62POd would set forth the orders with a conditional or undisplayed price and/or size that would be available for options trading on Pillar. On Pillar, the Exchange proposes to offer the same type of orders that are available in the OX system and that are currently described in Rule 6.62Od as a Contingency Order or Working Order, with changes as described below.
Reserve Order. Reserve Orders are currently defined in Rule 6.62Od3.
The Exchange proposes that for options traded on Pillar, Reserve Orders would function similarly to how Reserve Orders function on its cash equity market, as described in Rule 7.31
Ed1. Accordingly, the Exchange proposes that proposed Rule 6.62P
Od1, which would define Reserve Orders for options trading on Pillar, would be based on Rule 7.31Ed1, with differences only to reflect differences in options and cash equity trading. For example, options trading does not have a concept of round lot or odd lot trading, and therefore the proposed options trading version of the Rule would not include description of behavior that correlates to such functionality.
Proposed Rule 6.62POd1 would define a Reserve Order as a Limit Order with a quantity of the size displayed and with a reserve quantity of the size reserve interest that is not displayed and that the displayed quantity of a
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Reserve Order is ranked Priority 2
Display Orders and the reserve interest is ranked Priority 3Non-Display Orders. This proposed rule text is based on Rule 7.31Ed1 without any differences. Proposed Rule 6.62P
Od1 would further provide that both the display quantity and the reserve interest of an arriving marketable Reserve Order would be eligible to trade with resting interest in the Consolidated Book or route to Away Markets, unless designated as a Non-Routable Limit Order, which is based on the third sentence of Rule 7.31Ed1 with a non-substantive difference to add reference to Non-Routable Limit Order.
Proposed Rule 6.62POd1 would further provide that the working price of the reserve interest of a resting Reserve Order to buy sell would be adjusted in the same manner as a Non-Displayed Limit Order, as provided for in paragraph d2A of this Rule, provided that it would never be priced higher lower than the working price of the display quantity of the Reserve Order. This proposed rule text is based on the last sentence of Rule 7.31Ed1
with one difference to reference that the reserve interest could never have a working price that is more aggressive than the working price of the display quantity of the Reserve Order, which would be new functionality on Pillar designed to ensure that the reserve interest of a Reserve Order to buy sell would never trade at a price higher lower than the working price of the display quantity of the Reserve Order.28
Proposed Rule 6.62POd1A
would provide that the displayed portion of a Reserve Order would be replenished when the display quantity is decremented to zero and that the replenish quantity would be the minimum display size of the order or the remaining quantity of the reserve interest if it is less than the minimum display quantity. This proposed rule text is based on Rule 7.31Ed1A
with differences to reflect that options are not traded in round lots or odd lots. Accordingly, the Exchange would not replenish a Reserve Order on the options trading platform until the display portion is fully decremented.
Proposed Rule 6.62POd1B
would provide that each time the 28 For example, as described in more detail below, the proposed Non-Routable Limit Order would be eligible to be repriced only once after it is resting in the Consolidated Book see proposed Rule 6.62P
Oe1. If the display quantity of a Non-Routable Limit Order that is combined with a Reserve Orders has already been repriced and is no longer eligible to be repriced, and the Away Market NBBO adjusts, the reserve quantity would not adjust to a price that would be more aggressive than the working price of the display quantity of the order.

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