Exchanges and Finra have adopted rule changes which lift restrictions on position limits on options on the SPDR S&P 500 ETF (SPY). In 2012, NYSE Amex Options was the first exchange to file for and receive approval to eliminate position and exercise limits for SPY options. Subsequently, other exchanges and Finra have amended their rules governing SPY position and exercise limits.
“This is great news for everyone,” said Steve Crutchfield, CEO of NYSE Amex Options. “In August 2012, we, Amex, were the first options exchange to file for, and ultimately be approved, to eliminate position limits in SPY.”
SPY is the most liquid options contract, accounting for about 12% of all options trading volume, making it a logical candidate for elimination of position limits. NYSE Amex Options is lifting the position limit on a pilot basis, until December 15, 2014. “Our thinking is to evaluate the pilot, provide data to the SEC, and assuming all goes well, we would be interested in expanding this to ETFs on other broad-based indexes like IWM, QQQ and similar products,” Crutchfield said.