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July 15, 2015.
On May 15, 2015, NYSE Arca, Inc. (the “Exchange” or “NYSE Arca”) filed with the Securities and Exchange Commission (the “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act” or “Exchange Act”) 
and Rule 19b-4 thereunder,
a proposed rule change to list and trade shares (“Shares”) of the SPDR® SSgA Flexible Allocation ETF (“Fund”) under NYSE Arca Equities Rule 8.600. The proposed rule change was published for comment in the Federal Register on June 4, 2015.
On June 30, 2015, the Exchange filed Amendment No. 1 to the proposal.
On July 10, 2015, the Exchange filed Amendment No. 2 to the proposal.
The Exchange also filed Amendment No. 3 to the proposal on July 13, 2015.
The Commission received no comments on the proposal. The Commission is publishing this notice to solicit comments on Amendment Nos. 1, 2, and 3 from interested persons, and is approving the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, on an accelerated basis.
II. The Exchange's Description of the Proposal 
NYSE Arca proposes to list and trade shares of the Fund under NYSE Arca Equities Rule 8.600, which governs the listing and trading of Managed Fund Shares.
The Shares will be offered by SSgA Active ETF Trust (“Trust”), which is organized as a Massachusetts business trust and is registered with the Commission as an open-end management investment company.
SSgA Funds Management, Inc. will serve as the investment adviser to the Fund (“Adviser”).
State Street Global Markets, LLC will be the principal underwriter and distributor of the Fund's Shares. State Street Bank and Trust Company will serve as administrator, custodian and transfer agent for the Fund (“Custodian”).
The Adviser is not a registered broker-dealer but is affiliated with a broker-dealer and has implemented a “fire wall” with respect to such broker-dealer regarding access to information concerning the composition and/or changes to the Fund's portfolio.
A. Principal Investments of the Fund
The Fund will seek to provide long-term total return. In seeking long-term total return, the Adviser will target a return that exceeds one-month London Interbank Offered Rate (“LIBOR”) by at least 4% every year over a five-year investment timeframe. According to the Exchange, the Fund will be actively managed and will not seek to replicate the performance of a specified index.
Under normal circumstances,
the Fund will invest substantially all of its Start Printed Page 43513assets in the Portfolio, a separate series of the SSgA Master Trust with an identical investment objective as the Fund. As a result, the Fund will invest indirectly in all of the securities and assets owned by the Portfolio.
The investment practices of the Portfolio are the same in all material respects to those of the Fund.
The Adviser will seek to gain exposure to a wide range of asset classes, including real estate; equity and fixed income securities, including high yield debt securities; commodities; instruments that seek to track movements in volatility indices; and cash and cash equivalents or money market instruments. Under normal circumstances, the Portfolio will invest at least 80% of its net assets in ETPs,
VIX Futures, and equity options (including options on ETPs).
B. Non-Principal Investments
While under normal circumstances, the Adviser will invest at least 80% of the Portfolio's net assets as described in the Principal Investments section, above, the Adviser may invest up to 20% of the Portfolio's net assets in other securities and financial instruments, as described below.
The Portfolio may hold in the following types of assets:
- Equities securities other than ETPs mentioned above,
including exchange-listed or over-the-counter (“OTC”) common stock and preferred securities of domestic and foreign corporations; real estate investment trusts; and the securities of other investment companies.
- Fixed income securities, including U.S. government and U.S. government agency securities; repurchase agreements and reverse repurchase agreements; bonds, including sovereign debt and U.S. registered, dollar-denominated bonds of foreign corporations, governments, agencies and supra-national entities; convertible securities; short term instruments, including money market instruments; inflation-protected public obligations, commonly known as “TIPS,” of the U.S. Treasury, as well as TIPS of major governments and emerging market countries; and variable and floating rate securities, including variable rate demand notes and variable rate demand obligations.
- Cash and cash equivalents.
- Restricted securities, including equity and fixed income restricted securities.
- The following types of derivatives: Exchange-listed and non-exchange listed options (other than the equity options mentioned above), swaps, forward contracts, and futures contracts (other than the VIX Futures mentioned above). The derivatives that the Portfolio invests in may be based on equity or fixed income securities and/or equity or fixed income indices, currencies, and interest rates.
The Portfolio also may conduct foreign currency transactions on a spot (i.e., cash) basis and engage in short sales “against the box.” 
III. Discussion and Commission Findings
After careful review, the Commission finds that the Exchange's proposal to list and trade the Shares is consistent with the Exchange Act and the rules and regulations thereunder applicable to a national securities exchange.
In particular, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Exchange Act,
which requires, among other things, that the Exchange's rules be designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest.
The Commission finds that the proposal to list and trade the Shares on the Exchange is consistent with Section 11A(a)(1)(C)(iii) of the Exchange Act,
which sets forth Congress' finding that it is in the public interest and appropriate for the protection of investors and the maintenance of fair and orderly markets to assure the availability to brokers, dealers, and investors of information with respect to quotations for and transactions in securities. Quotation and last-sale information for the Shares and underlying equity securities traded on a national securities exchange will be available via the Consolidated Tape Association high speed line. The Exchange represents that the intra-day, closing and settlement prices of underlying equity securities traded on a national securities exchange, as well as exchange-traded futures and foreign exchange-traded common stocks and preferred securities, will be readily available from the exchanges trading such assets as well as automated quotation systems, published or other public sources, or on-line information services. Intra-day and closing price information for exchange-listed options and futures will be available from the applicable exchange and from major market data vendors. In addition, price information for U.S. exchange-listed options is available from the Options Price Reporting Authority. Quotation information from brokers and dealers or pricing services will be available for fixed income securities, spot, and forward currency transactions; and equity securities traded in the OTC market (e.g., restricted securities and non-exchange listed securities of investment companies). Price information regarding OTC-traded derivative instruments, as well as equity securities traded in the OTC market, is available from major market data vendors. Pricing information regarding each asset class in which the Fund or Portfolio will invest will generally be available through nationally recognized data service providers through subscription arrangements.
The Commission also believes that the proposal to list and trade the Shares is reasonably designed to promote fair disclosure of information that may be necessary to price the Shares appropriately and to prevent trading when a reasonable degree of transparency cannot be assured. On Start Printed Page 43514each business day, before commencement of trading in Shares in the Core Trading Session on the Exchange, the Fund will disclose on its Web site the Disclosed Portfolio as defined in NYSE Arca Equities Rule 8.600(c)(2) that will form the basis for the Fund's calculation of NAV at the end of the business day.
The Exchange will obtain a representation from the issuer of the Shares that the NAV per Share will be calculated daily and that the NAV and the Disclosed Portfolio will be made available to all market participants at the same time. In addition, the Indicative Optimized Portfolio Value (“IOPV”) of the Fund, which is the Portfolio Indicative Value as defined in NYSE Arca Equities Rule 8.600 (c)(3), will be widely disseminated at least every 15 seconds during the Exchange's Core Trading Session by one or more major market data vendors. The Custodian, through the National Securities Clearing Corporation, will make available on each Business Day, immediately prior to the opening of business on the Exchange (currently 9:30 a.m., Eastern Time (“E.T.”)), the list of the names and the required number of shares of each Deposit Security or the required amount of Deposit Cash, as applicable, to be included in the current Fund Deposit (based on information at the end of the previous Business Day) for the Fund. The NAV of the Portfolio will be calculated by the Custodian and determined at the close of the regular trading session on the New York Stock Exchange (ordinarily 4:00 p.m. E.T.) on each day that such exchange is open. The Fund's Web site will include a form of the prospectus for the Fund that may be downloaded and additional information relating to NAV and other applicable information.
The Exchange represents that trading in the Shares will be halted if the circuit breaker parameters in NYSE Arca Equities Rule 7.12 have been reached or because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable.
Trading in the Shares will be subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which sets forth circumstances under which Shares may be halted.
The Exchange states that it has a general policy prohibiting the distribution of material, non-public information by its employees.
The Exchange represents that the Adviser is not registered as a broker-dealer but is affiliated with a broker-dealer and has implemented a “fire wall” with respect to such broker-dealer regarding access to information concerning the composition and/or changes to the Fund's portfolio.
Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit Holders in an Information Bulletin (“Bulletin”) of the special characteristics and risks associated with trading the Shares. The Exchange states that trading in the Shares will be subject to the existing trading surveillances, administered by the Financial Industry Regulatory Authority (“FINRA”) on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws.
On behalf of the Exchange, FINRA will communicate as needed regarding trading in the Shares, underlying U.S. exchange-traded equity securities, exchange-traded options, futures, and foreign exchange-traded common stocks and preferred securities with other markets and other entities that are members of ISG, and FINRA, on behalf of the Exchange, may obtain trading information regarding trading in the Shares and underlying U.S. exchange-traded equity securities, exchange-traded options, futures, and common stocks and preferred securities of foreign corporations from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares and U.S. exchange-traded equity securities, exchange-traded options, futures, and common stocks and preferred securities of foreign corporations from markets and other entities that are members of ISG or with which the Exchange has in place a CSSA.
FINRA, on behalf of the Exchange, is able to access, as needed, trade information for certain fixed income securities held by the Fund reported to FINRA's Trade Reporting and Compliance Engine.
The Exchange represents that it deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange's existing rules governing the trading of equity securities.
In support of this proposal, the Exchange has also made the following representations:
(1) The Shares of the Fund will conform to the initial and continued listing criteria under NYSE Arca Equities Rule 8.600.
(2) The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions.
(3) Trading in the Shares will be subject to the existing trading surveillances, administered by FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws, and these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange.
(4) Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit Holders in a Bulletin of the special characteristics and risks associated with trading the Shares. Specifically, the Bulletin will discuss the following: (a) The procedures for purchases and redemptions of Shares in Creation Unit aggregations (and that Shares are not individually redeemable); (b) NYSE Arca Equities Rule 9.2(a), which imposes a duty of due diligence on its ETP Holders to learn the essential facts relating to every customer prior to trading the Shares; (c) the risks involved in trading the Shares during the Opening and Late Trading Sessions when an updated IOPV will not be calculated or publicly disseminated; (d) how information regarding the IOPV and the Disclosed Portfolio is disseminated; (e) the requirement that Equity Trading Permit Holders deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; and (f) trading information.
(5) For initial and/or continued listing, the Fund will be in compliance with Rule 10A-3 
under the Act, as provided by NYSE Arca Equities Rule 5.3.
(6) While the Fund may invest in inverse ETFs, the Fund will not invest Start Printed Page 43515in leveraged or inverse leveraged ETFs or ETNs (e.g., 2X or 3X).
(7) The Portfolio may invest up to 20% of its assets in derivatives.
(8) The Portfolio may invest up to 25% of its total assets in one or more ETPs that are QPTPs and whose principal activities are the buying and selling of commodities or options, futures, or forwards with respect to commodities.
(9) The Portfolio may invest up to 10% of its net assets in high yield debt securities.
(10) Not more than 10% of the net assets of the Fund will consist of equity securities that trade in markets that are not members of the ISG or are not parties to CSSA with the Exchange.
(11) The Fund may hold up to an aggregate amount of 15% of its net assets in illiquid assets (calculated at the time of investment), including Rule 144A securities deemed illiquid by the Adviser, consistent with Commission guidance. The Fund will monitor its portfolio liquidity on an ongoing basis to determine whether, in light of current circumstances, an adequate level of liquidity is being maintained, and will consider taking appropriate steps in order to maintain adequate liquidity if, through a change in values, net assets, or other circumstances, more than 15% of the Fund's net assets are held in illiquid assets.
(12) A minimum of 100,000 Shares will be outstanding at the commencement of trading on the Exchange.
This approval order is based on all of the Exchange's representations, including those set forth above and in the Notice.
For the foregoing reasons, the Commission finds that the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, is consistent with Section 6(b)(5) of the Act 
and the rules and regulations thereunder applicable to a national securities exchange.
IV. Solicitation of Comments on Amendment Nos. 1, 2 and 3
Interested persons are invited to submit written data, views, and arguments concerning whether Amendment Nos. 1, 2, and 3 is consistent with the Act. Comments may be submitted by any of the following methods:
- Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEArca-2015-44. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2015-44 and should be submitted on or before August 12, 2015.
V. Accelerated Approval of Proposed Rule Change as Modified by Amendment Nos. 1, 2, and 3
The Commission finds good cause to approve the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, prior to the 30th day after the date of publication of notice of the amendment in the Federal Register. The Exchange submitted Amendment Nos. 1, 2, and 3 to, among other things, provide clarifying details about the investments the Portfolio would be permitted to hold and the valuation of OTC-traded derivative assets, and to limit the percentage of the Portfolio that may be comprised of options that are listed on markets that are not members of the ISG or with which the Exchange does not have a CSSA.
This information is useful for evaluating the likelihood of market participants engaging in effective arbitrage and the Exchange's ability to detect improper trading activity that impacts the price of the Shares. Accordingly, the Commission believes that Amendment Nos. 1, 2, and 3 are consistent with the provisions of Section 6(b)(5) of the Act,
and therefore finds good cause, pursuant to Section 19(b)(2) of the Act,
for approving the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, on an accelerated basis.
It is therefore ordered, pursuant to Section 19(b)(2) of the Exchange Act, that the proposed rule change (SR-NYSEArca-2015-44), as modified by Amendment Nos. 1, 2, and 3, is hereby approved on an accelerated basis.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Robert W. Errett,
[FR Doc. 2015-17898 Filed 7-21-15; 8:45 am]
BILLING CODE 8011-01-P