Notification of Amendments to Strike Price Intervals for Silver Option and Copper Option Contracts

Please be advised that effective Monday, December 21, 2009, the Commodity Exchange, Inc. (“COMEX” or “Exchange”) will amend the listing of strike prices for Silver Option (code SO) and Copper Option (code HX) contracts listed for trading on CME Globex^® and the COMEX trading floor, respectively, and for clearing through CME ClearPort^®.

Specifically, the Exchange will expand the strike price listing for each of Silver Option and Copper Option contracts from six to twenty strike prices above and below the at-the-money option for both trading venues, the trading floor and CME Globex, such that the expanded strike price listing is applicable to all trading months regardless of the level of the underlying futures prices.

For Silver Options, the strike price increment will be a standard $0.05 per troy ounce. Currently, price increments vary according to the futures price from $0.10, $0.25, and $0.50.

For Copper Options, the strike increment will be $0.01. Currently, price increments vary according to the futures price from $0.01, $0.02, and $0.05. For options to be cleared through CME ClearPort, in addition to regular listing, strikes can be added on an as-needed basis.

For more information, please contact Bob Biolsi, at (212) 299-2610.

The Rule amendments are presented below in blackline for your convenience.

RULE AMENDMENTS

UNDERSCORE denotes addition; Strikethrough denotes deletion

SILVER OPTION

116.03. STRIKE PRICES FOR SILVER FUTURES OPTIONS

(a)

February and January Expiration Cycle

(1) Strike prices for silver futures option contracts shall be in the following increments per troy ounce of silver during the six nearby for all trading months at an interval of five cents ($.05). :

(A) for strike prices of less than or equal to eight dollars, the strike price increments are $0.25 and $0.10;

(B) for strike prices greater than eight dollars and up to and including fifteen dollars, the strike price increments are $0.25; and

(C) for strike prices greater than fifteen dollars, the strike price increments are $0.50.

(2) Strike prices for silver futures options shall be in the following increments per troy ounce of silver for all other months than the nearest six nearby months but not greater than 2 years to expiration:

(A) for strike prices of less than or equal to eight dollars, the strike price increments are $0.25;

(B) for strike prices greater than eight dollars, and up to and including fifteen dollars, the strike price increments are $0.50; and

(C) for strike prices greater than fifteen dollars, the strike price increments are $1.00.

(3) For trading months greater than 2 years to expiration, strike price increments will be 1.00. Trading in puts and calls on the first day of a new option contract month shall be at the following five strike prices: (i) the previous day’s settlement price for silver futures contracts in the corresponding delivery month rounded off to the nearest strike price unless such settlement price is precisely midway between two strike prices, in which case it shall be rounded off to the higher price; (ii) the two strike prices which are the two increments higher than the strike price described in (i) of this Rule 116.03(a)(3); and (iii) the two strike prices which are the two increments lower than the strike price described in (i) of this Rule 116.03(a)(3). Thereafter, additional strike prices are added such that there will be at least two strike price increments above and below the at-the money option.

(4) Trading in puts and calls on the first day of a new option contract month in the February expiration cycle shall be at the following thirteen twenty strike prices: (i) the previous day's settlement price for silver futures contracts in the corresponding delivery month rounded off to the nearest strike price unless such settlement price is precisely midway between two strike prices, in which case it shall be rounded off to the higher price; (ii) the six twenty strike prices which are the six twenty increments higher than the strike price described in (i) of this Rule 116.03(a)(4); and (iii) the six twenty strike prices which are the six twenty increments lower than the strike price described in (i) of this Rule 116.03(a)(4).  Thereafter, additional strike prices are added such that there will be at least twenty strike price increments above and below the at-the-money option.

 (5) (a) Trading in puts and calls on the first day of a new option contract month in the January expiration cycle shall be at the following strike prices; provided however, that the strike price is less than or equal to eight dollars: (i) the previous day’s settlement price for silver futures contracts in the corresponding delivery month rounded off to the nearest strike price unless such settlement price is precisely midway between two strike prices, in which case it shall be rounded off to the higher price; (ii) the six strike prices which are in increments of $0.10 and the six strike prices which are in increments of $0.25 higher than the strike price described in (i) of this Rule 116.03(a)(5)(a); and (iii) the six strike prices which are in increments of $0.10 and the strike prices which are in increments of $0.25 lower than the strike price described in (i) of this Rule 116.03(a)(5)(a). (b) In the event that strike prices are greater than eight dollars, trading in puts and calls on the first day of a new option contract month in the January expiration cycle shall be at the following thirteen strike prices with strike price increments determined pursuant to Rule 116.03(a)(1)(B) and (C): (i) the previous day’s settlement price for silver futures contracts in the corresponding delivery month rounded off to the nearest strike price unless such settlement price is precisely midway between two strike prices, in which case it shall be rounded off to the higher price; (ii) the six strike prices which are the six increments higher than the strike price described in (i) of this Rule 116.03(a)(5)(b); and (iii) the six strike prices which are the six increments lower than the strike price described in (i) of this Rule 116.03(a)(5)(b).

(6) Whenever the settlement price for silver futures contracts in the delivery month corresponding to an option contract month is equal to or greater than (i) the seventh highest strike price for that option contract month plus (ii) one-half the increment between the seventh highest strike price and the sixth highest strike price, one or more new strike prices for both puts and calls shall be introduced on the following business day, on the increments set forth in paragraph (a) above, so that at all times there will be at least six strike prices above the at-the-money strike price.

(7) Whenever the settlement price for silver futures contracts in the delivery month corresponding to an option contract month is less than (i) the seventh lowest strike price for that option contract month minus (ii) one-half the increment between the seventh lowest strike price and the sixth lowest strike price, one or more new strike prices for both puts and calls shall be introduced on the following business day, on the increments set forth in paragraph (a) above, so that at all times there will be at least six strike prices below the at-the-money strike price.

(8) No new strike prices shall be introduced in the option contract month of the silver futures options next due to expire after the third business day prior to the Expiration Date for such futures options.

(b) Notwithstanding the provisions of section (a) of this Rule 116.03, if the Exchange Board determines that trading in silver futures option contracts will be facilitated thereby, the Board Exchange may, by resolution, change the increments between strike prices, the number of strike prices which shall be traded on the first day in any new option contract month, the price of the silver futures contract at which a new strike price will be introduced, or the period preceding the expiration of a silver futures option contract in which no new strike prices may be introduced.

(c) In addition to strike prices authorized pursuant to other sections of this Rule 116.03, the President of the Exchange or his designee may direct that additional strike prices be added. Such strike prices may be added provided they may be listed only in increments consistent with the pricing for the underlying futures contract. Such directed strike prices shall be effective upon adoption. Notice of such adoption must be given by the Exchange to the CFTC pursuant to Commission Regulation 1.41(n) in such fashion that the CFTC receives such notice within three business days of the strike price listing.

COPPER OPTION

117.04. STRIKE PRICES FOR GRADE 1 COPPER FUTURES OPTIONS

(a) February and January Expiration Cycle

(1) Strike prices for grade 1 copper futures option contracts shall be listed in the following increments per pound of copper for all trading months at an interval of one cent ($.01).  :

(A) for strike prices of less than or equal to forty cents ($0.40), the strike price increments shall be one cent ($0.01);

(B) for strike prices greater than forty cents ($0.40) and up to and including one dollar and twenty cents ($1.20), the strike price increments shall be two cents ($0.02); and

(C) for strike prices greater than one dollar and twenty cents ($1.20), the strike price increments are shall be five cents ($0.05).

(2) Trading in puts and calls on the first day of a new option contract month shall be at the following forty-one thirteen strike prices: (i) the previous day's settlement price for grade 1 copper futures contracts in the corresponding delivery month rounded off to the nearest strike price unless such settlement price is precisely midway between two strike prices, in which case it shall be rounded off to the higher price and (ii) the twenty six strike prices which are the six twenty increments higher than the strike price described in (i) of this Rule 117.04(a)(2), and (iii) the six twenty strike prices which are twenty the six increments lower than the strike price described in (i) of this Rule 117.04(a)(2). Thereafter, additional strike prices are added such that there will be at least twenty strike price increments above and below the at-the-money option.

(3) Whenever the settlement price for grade 1 copper futures contracts in the delivery month corresponding to an option contract month is equal to or greater than (i) the seventh highest strike price for that option contract month plus (ii) one-half the increment between the seventh highest strike price and the sixth highest strike price, one or more new strike prices for both puts and calls shall be introduced on the following business day, on the increments set forth in paragraph (a) above, so that at all times there will be at least six strike prices above the at-the-money strike price.

(4) Whenever the settlement price for grade 1 copper futures contracts in the delivery month corresponding to an option contract month is less than (i) the seventh lowest strike price for that option contract month minus (ii) one-half the increment between the seventh lowest strike price and the sixth lowest strike price, one or more new strike prices for both puts and calls shall be introduced on the following business day, on the increments set forth in paragraph (a) above, so that at all times there will be at least six strike prices below the at-the-money strike price.

(5) No new strike prices shall be introduced in the option contract month of the grade 1 copper futures options next due to expire after the third business day prior to the Expiration Date for such futures options.

(b) Notwithstanding the provisions of Rule 117.04(a), if the Exchange Board determines that trading in grade 1 copper futures option contracts will be facilitated thereby, the Board Exchange may, by resolution, change the increments between strike prices, the number of strike prices which shall be traded on the first day in any new option contract month, the price of the grade 1 copper futures contract at which a new strike price will be introduced, or the period preceding the expiration of a grade 1 copper futures option contract in which no new strike prices may be introduced. .

(c) In addition to strike prices authorized pursuant to other sections of this Rule 117.04, the President of the Exchange or his designee may direct that additional strike prices be added. Such strike prices may be added provided they may be listed only in increments consistent with the pricing for the underlying futures contract. Such directed strike prices shall be effective upon adoption. Notice of such adoption must be given by the Exchange to the CFTC pursuant to Commission Regulation 1.41(n) in such fashion that the CFTC receives such notice within three business days of the strike price listing.