Nasdaq ISE removes cross-market risk protection with GEMX

On September 25, 2026 Nasdaq ISE, LLC filed a proposed rule change with the SEC under Section 19(b)(1) of the Act and Rule 19b-4. The filing, identified as Release No. 34-106595; File No. SR-ISE-2026-52, was announced in a notice on October 5, 2026.

The amendment deletes the cross-market election in Options 3, Section 15(a)(1)(C) that currently permits Members to apply Market Wide Risk Protection (MWRP) across both ISE and its affiliate Nasdaq GEMX, LLC. After the change, MWRP will operate on a per-exchange basis on ISE, while GEMX will retain a separate per-exchange MWRP rule.

The Exchange states the purpose is to harmonize MWRP functionality across the Nasdaq affiliated options exchanges, aligning ISE with MRX, Phlx, NTX Options, and NOM, which already use a per-exchange model. The proposal is grounded in Section 6(b) of the Act and Section 6(b)(5), aiming to promote a free and open market and protect investors.

The rule change is effective immediately pursuant to Section 19(b)(3)(A)(iii) and Rule 19b-4(f)(6). The Exchange will announce the operative date in an Options Trader Alert and expects to implement the amendment on or before Q2 2027. No written comments were received during the comment period.

The Exchange asserts the amendment imposes no undue burden on competition, noting that Members may still configure their own risk-management systems to aggregate protection across exchanges if desired.