NYSE American Proposal to Expand Short-Term Options Expirations Becomes Operative
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On March 27, 2026, NYSE American LLC filed a proposed rule change with the Securities and Exchange Commission (the “SEC”) to amend its Short Term Options Series Program. The proposal would permit the listing of additional Monday and Wednesday expiration options for certain highly liquid securities. On March 30, 2026, the SEC waived the 30-day operative delay, allowing the proposed rule change to become operative immediately upon filing.
This article summarizes the key elements of the proposal and its potential implications for market participants.
Overview of the Proposed Rule Change
The proposal seeks to expand the existing Short Term Options Series Program by allowing up to two additional Monday and Wednesday expiration dates for options on certain eligible securities.
Currently, the program primarily permits weekly Friday expirations and limited daily expirations for specific symbols. The proposed change would extend this framework to a broader, but still limited, group of securities that meet defined eligibility criteria.
What Are “Qualifying Securities”?
The proposed expansion applies only to “Qualifying Securities,” which are defined as certain individual stocks or exchange traded fund shares that meet specific thresholds.
To qualify, a security must satisfy the following criteria on a quarterly basis:
- Market capitalization greater than 700 billion dollars for individual stocks, or assets under management greater than 50 billion dollars for exchange traded fund shares
- Monthly options volume greater than 10 million contracts
- A position limit of at least 250,000 contracts
- Participation in the Penny Interval Program
The exchange will determine eligibility each quarter and publish the list of qualifying securities at the beginning of the period.
Structure of the Additional Expirations
For qualifying securities, the exchange would permit:
- Up to two Monday expirations beyond the current week
- Up to two Wednesday expirations beyond the current week
These expirations would not be listed on days that coincide with standard monthly or quarterly option expirations. In addition, the exchange would not list expirations on days when an earnings announcement is scheduled after market close.
If a scheduled expiration falls on a non-business day, the expiration date would be adjusted to the nearest business day in accordance with existing program rules.
Operational Features
The proposed Monday and Wednesday expirations would follow the same general structure as existing short-term options, including:
- Strike price intervals consistent with current short-term option series
- A limit of thirty series per expiration date for each option class
- M. settlement
- The ability to list additional series that are already listed on other exchanges
The exchange states that it has sufficient system capacity and surveillance programs in place to support these additional expirations and does not expect market disruptions.
Rationale for the Proposal
NYSE American states that the proposal is designed to provide investors with additional flexibility in managing investment and hedging strategies.
According to the filing, the additional expiration dates would:
- Allow market participants to better tailor hedging and investment decisions
- Provide more opportunities to manage risk exposure
- Potentially reduce the cost of portfolio protection
- Improve market quality by encouraging more efficient capital deployment by market makers
The exchange also notes that the eligibility criteria are designed to limit the expansion to highly liquid securities, representing a small subset of the overall market.
Key Takeaway
The proposed rule change represents a limited expansion of short-term options expirations for a small group of highly liquid securities.
By introducing additional Monday and Wednesday expirations, the exchange aims to provide greater flexibility for hedging and investment strategies while maintaining existing safeguards related to liquidity, market structure, and investor protection.
If you would like to discuss how this proposed rule change may affect options trading strategies or market structure considerations, our team would be happy to assist.
Contact Person: Nick L. Torres, Esq. and Zhiqi Zheng, Esq.
Written By Weiwei Lu
Weiwei Lu specializes in securities law and corporate matters, and general public company work. She leverages her bilingual proficiency in English and Mandarin and her deep understanding of cross-border business and cultural environments to help Chinese companies navigate the complex and rapidly evolving U.S. legal and regulatory landscape. With strong cross-cultural communication skills, she supports clients in facilitating efficient transactions and achieving their business goals.
