The brand new guidelines require national securities exchanges, designated contract markets, registered DTEFs, and international boards of commerce to gather info to ascertain the market capitalization and greenback value of ADTV for component securities of an index with respect to every day, in certain circumstances bearing in mind information for the preceding 6 full calendar months. In the Proposing Release, the SEC estimated that any extra prices of retaining and storing the collected info discussed above can be nominal because national securities exchanges, including notice-registered nationwide securities exchanges which have been designated as contract markets by, or registered as DTEFs with, the CFTC, are at present required to have recordkeeping methods in place.159 The SEC obtained no direct comments on the costs of knowledge retention and storage. The trading of futures contracts on broad-based safety indexes can be below the only jurisdiction of the CFTC and may be traded solely on designated contract markets, and registered DTEFs. https://k12.instructure.com/eportfolios/508216/Home/7_Examples_Of_1 gives a limited exclusion from the definition of "slender-primarily based security index" for an index underlying a futures contract that has traded for lower than 30 days, as long because the index meets sure specified standards.
New Rule 3a55-2 beneath the Exchange Act excludes from the definition of slender-based security index those safety indexes on which futures contracts have traded on a chosen contract market, a registered DTEF, or overseas board of trade for fewer than 30 days and become narrow-based mostly, offered that they meet certain criteria. The calculations required beneath the brand new rules for market capitalization and greenback value of ADTV could require further information storage.173 A national securities exchange, designated contract market, or registered DTEF will want to think about the way to retailer the data-whether to maintain arduous copies or electronic copies of all of the computations. The full burden in complying with Rule 17a-1 for every national securities exchange, including discover registered nationwide securities exchanges, beneath new Rule 3a55-1 is subsequently estimated to be 11 hours. The present burden hour estimate for Rule 17a-1, as of July 20, 1998, is 50 hours per yr for every exchange.160 In the Proposing Release, the SEC estimated that it would take each of the 11 nationwide securities exchanges, together with discover-registered nationwide securities exchanges, expected to trade futures contracts on safety indexes one hour yearly to retain any paperwork made or received by it in determining whether an index is a slim-based mostly security index.
2. Burden Hours National securities exchanges, together with notice-registered nationwide securities exchanges, that commerce futures contacts on safety indexes can be required to adjust to the recordkeeping requirements beneath Rule 17a-1. National securities exchanges, including discover-registered nationwide securities exchanges, might be required to retain and store any paperwork associated to determinations made utilizing the definitions in Exchange Act Rule 3a55-1 for a minimum of 5 years, the primary two years in an easily accessible place. These modifications to the foundations change considerably the methodology used to determine whether or not a safety index is narrow-based or broad-based mostly but don't, in any approach, alter the recordkeeping burden related to the preservation of the information of those calculations, i.e., the gathering of knowledge required pursuant to Rule 17a-1 below the Exchange Act.152 Any assortment of data pursuant to the brand new guidelines is mandatory and will must be retained by the national securities exchanges, including nationwide securities exchanges registered pursuant to Section 6(g) of the Exchange Act ("notice-registered nationwide securities exchanges"), for a minimum of five years; for the first two years, the data should be saved in an easily accessible place, as required under Exchange Act Rule 17a-1. A. The Use and Disclosure of the information Collected The knowledge collected to comply with the strategies to determine market capitalization and greenback worth of ADTV which can be set forth in the final guidelines is required by the CFMA.
Rule 3a55-1 underneath the Exchange Act specifies the strategy to find out market capitalization and dollar worth of ADTV with respect to the definition of slender-primarily based safety index.156 Thus, the final rule provides the strategies by which a market trading a futures contract on a security index should determine the market capitalization and dollar value of ADTV to ascertain whether or not a safety index on which it proposes to trade, or is buying and selling, a futures contract is narrow-primarily based, and thus is topic to the joint jurisdiction of the CFTC and the SEC. Under the statutory definition of narrow-based safety index, the market capitalization and greenback worth of ADTV have to be calculated "as of the preceding 6 full calendar months." Rule 3a55-1 specifies a "rolling" 6 month period, i.e., with respect to a selected day, the "previous 6 full calendar months" will mean the period of time starting on the same calendar date 6 months before and ending on the day prior to that day.