Feb. 5, 2024
Dear Securities and Exchange Commission, I am writing to express my deep concerns and opposition to the proposed rule change by the Options Clearing Corporation (OCC) to adjust parameters for calculating margin requirements during periods of high market volatility, as outlined in the recent filing [File No. SR-OCC-2024-001]. As an active participant in the financial markets, I believe it is crucial to address certain aspects of the proposal that have raised serious apprehensions regarding its potential impact on market stability, the lack of transparency in redacted materials, and the apparent conflict of interest associated with the role of the Financial Risk Management (FRM) Officer. Firstly, the proposed rule change raises substantial concerns about its potential impact on market stability. The adjustment of parameters for calculating margin requirements during periods of high volatility could potentially exacerbate market stress by increasing margin calls and reducing market liquidity. Secondly, the lack of transparency in redacted materials within the proposal is a matter of significant concern. Transparency is paramount in maintaining market integrity and investor confidence. The undisclosed details within the proposal hinder a comprehensive understanding of the potential risks and benefits associated with the proposed changes. I urge the Securities and Exchange Commission (SEC) to request full disclosure of the redacted materials to ensure a thorough and transparent evaluation of the rule change. Furthermore, the role of the Financial Risk Management (FRM) Officer in the proposed rule change introduces an inherent conflict of interest. The FRM Officer is entrusted with safeguarding the financial stability of the OCC, and any adjustments made under their purview should be scrutinized for potential conflicts that may compromise the broader market's well-being. It is imperative for the SEC to thoroughly assess the independence and objectivity of the FRM Officer to ensure that their decision-making aligns with the best interests of market participants and the overall financial system. In advocating for a thorough reconsideration of the proposed rule change, I emphasize the importance of transparency, risk mitigation, and the broader market's well-being. The SEC plays a pivotal role in safeguarding the integrity and stability of the financial markets, and I trust that your careful consideration of these concerns will lead to a more robust and informed decision-making process. I appreciate your attention to this matter and look forward to the SEC's commitment to ensuring a fair, transparent, and stable financial market environment. Sincerely, An independent investor.