May 5, 2024
To whom it may concern, As a retail investor, I am writing to express my support for the SEC's consideration to disapprove the proposed rule change SR-OCC-2024-001 (34-100009). The Options Clearing Corporation's (OCC) proposal to adjust margin requirements during high volatility periods raises significant concerns about both the rationale behind the proposal and its implications for market trust and transparency. Upon reviewing the proposal, I was troubled by the substantial redactions and the overall lack of detailed disclosure, which severely restricts meaningful public review and commentary. This lack of transparency is especially concerning given that the OCC’s proposal seems to enable reductions in margin requirements under specific, yet inadequately described, conditions of high volatility. Such reductions could endanger the financial stability of the entire clearing system, particularly considering the OCC’s role as a Systemically Important Financial Market Utility (SIFMU). Moreover, the proposed rule change may set a perilous precedent where Clearing Members could evade recognizing the risks tied to highly volatile markets. This is evident from the OCC’s use of “idiosyncratic” and “global” control settings, which have historically led to significant reductions in aggregate margin requirements. This practice could potentially undermine the robust financial safeguards meant to protect the clearing corporation and its members, thereby shifting potential losses onto less protected entities, including retail investors like myself. I greatly appreciate the SEC's thorough scrutiny of this rule proposal and its commitment to ensuring that all market participants adhere to fair, transparent, and rigorously enforced rules. Such governance is crucial for maintaining the integrity and stability of financial markets. Thank you for considering my views on this critical matter. I trust that the SEC will continue to safeguard the interests of all investors, promoting a fair and stable market environment. Sincerely, Eugene Horikoshi