[Federal Register Volume 84, Number 26 (Thursday, February 7, 2019)]
[Notices]
[Pages 2618-2626]
[FR Doc No: 2019-01387]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85033; File No. SR-NYSEArca-2018-98]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change Relating to Listing and Trading Shares of the
iShares Commodity Multi-Strategy ETF Under NYSE Arca Rule 8.600-E; and
Notice of Designation of a Longer Period for Commission Action on
Proposed Rule Change Relating to Listing and Trading Shares of the
iShares Commodity Multi-Strategy ETF Under NYSE Arca Rule 8.600-E

February 1, 2019.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on December 21, 2018, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the iShares
Commodity Multi-Strategy ETF under NYSE Arca Rule 8.600-E (``Managed
Fund Shares''). The proposed change is available on the Exchange's
website at www.nyse.com, at the principal office of the Exchange, and
at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to list and trade shares (``Shares'') of the
iShares Commodity Multi-Strategy (``Fund'') under NYSE Arca Rule 8.600-
E, which governs the listing and trading of Managed Fund Shares \4\ on
the Exchange.
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    \4\ A Managed Fund Share is a security that represents an
interest in an investment company registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an
open-end investment company or similar entity that invests in a
portfolio of securities selected by its investment adviser
consistent with its investment objectives and policies. In contrast,
an open-end investment company that issues Investment Company Units,
listed and traded on the Exchange under NYSE Arca Rule 5.2-E(j)(3),
seeks to provide investment results that correspond generally to the
price and yield performance of a specific foreign or domestic stock
index, fixed income securities index or combination thereof.
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    The Shares will be offered by iShares U.S. ETF Trust (the
``Trust''), which is registered with the Commission as an open-end
management investment company.\5\ The Fund is a series of the Trust.
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    \5\ The Trust is registered under the 1940 Act. On December 3,
2018, the Trust filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') its registration statement on Form N-1A
under the Securities Act of 1933 (15 U.S.C. 77a), and under the 1940
Act relating to the Fund (File Nos. 333-179904 and 811-22649)
(``Registration Statement''). The description of the operation of
the Trust and the Fund herein is based, in part, on the Registration
Statement. In addition, the Commission has issued an order upon
which the Trust may rely, granting certain exemptive relief under
the 1940 Act. See Investment Company Act Release No. 29571 (January
24, 2011) (File No. 812-13601).
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    BlackRock Fund Advisors (``BFA'' or ``Adviser'') will be the
investment adviser for the Fund. BlackRock Investments, LLC will be the
distributor (``Distributor'') for the Fund's Shares. State Street Bank
and Trust Company will serve as the administrator, custodian and
transfer agent (``Custodian'' or ``Transfer Agent'') for the Fund.
    Commentary .06 to Rule 8.600-E provides that, if the investment
adviser to the investment company issuing Managed Fund Shares is
affiliated with a broker-dealer, such investment adviser shall erect
and maintain a ``fire wall'' between the investment adviser and the
broker-dealer with respect to access to information concerning the
composition and/or changes to such investment company portfolio.\6\ In
addition, Commentary .06 further requires that personnel who make
decisions on the open-end fund's portfolio composition must be subject
to procedures designed to prevent the use and dissemination of material
nonpublic information regarding the open-end fund's portfolio. The
Adviser is not registered as a broker-dealer but is affiliated with a
broker-dealer, and has implemented and will maintain a fire wall with
respect to its broker-dealer affiliate regarding access to information
concerning the composition and/or changes to the portfolio. In the
event (a) the Adviser becomes registered as a broker-dealer or newly
affiliated with a broker-dealer, or (b) any new adviser or sub-adviser
is a registered broker-dealer or becomes affiliated with a broker-
dealer, it will implement and maintain a fire wall with respect to its
relevant personnel or its broker-dealer affiliate regarding access to
information concerning the composition and/or changes to the portfolio,
and will be subject to procedures designed to prevent the use and
dissemination of material non-public information regarding such
portfolio.
iShares Commodity Multi-Strategy ETF.
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    \6\ An investment adviser to an open-end fund is required to be
registered under the Investment Advisers Act of 1940 (the ``Advisers
Act''). As a result, the Adviser and its related personnel are
subject to the provisions of Rule 204A-1 under the Advisers Act
relating to codes of ethics. This Rule requires investment advisers
to adopt a code of ethics that reflects the fiduciary nature of the
relationship to clients as well as compliance with other applicable
securities laws. Accordingly, procedures designed to prevent the
communication and misuse of non-public information by an investment
adviser must be consistent with Rule 204A-1 under the Advisers Act.
In addition, Rule 206(4)-7 under the Advisers Act makes it unlawful
for an investment adviser to provide investment advice to clients
unless such investment adviser has (i) adopted and implemented
written policies and procedures reasonably designed to prevent
violation, by the investment adviser and its supervised persons, of
the Advisers Act and the Commission rules adopted thereunder; (ii)
implemented, at a minimum, an annual review regarding the adequacy
of the policies and procedures established pursuant to subparagraph
(i) above and the effectiveness of their implementation; and (iii)
designated an individual (who is a supervised person) responsible
for administering the policies and procedures adopted under
subparagraph (i) above.
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Fund Investments
    According to the Registration Statement, the investment objective
of the Fund will be to seek to provide exposure, on a total return
basis, to a group of commodities with characteristics of carry,
momentum and value. The Fund is actively managed and seeks to achieve
its investment objective in part \7\ by, under normal market
conditions,\8\ investing in listed and over-the-counter (``OTC'') swaps
referencing the Reference Benchmark.\9\ In connection with investments
in swaps on the Reference Benchmark, the Fund is expected to establish
new swaps contracts on an ongoing basis and replace expiring
contracts.\10\ Swaps subsequently entered into by the Fund may have
terms that differ from the swaps the Fund currently holds. The Fund
expects generally to pay a fixed payment rate and certain swap related
fees to the swap counterparty and receive the total return of the
Reference Benchmark, including in the event of negative performance by
the Reference Benchmark, negative return (i.e., a payment from the Fund
to the swap counterparty). In seeking total return, the Fund
additionally aims to generate interest income and capital appreciation
through a cash management strategy consisting primarily of cash, cash
equivalents,\11\ and fixed income securities other than cash
equivalents, as described below.
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    \7\ The Fund's investment objective is also achieved by
investing in cash, cash equivalents, Commodity Investments, Fixed
Income Securities and Short-Term Fixed Income Securities (each as
defined or described below).
    \8\ The term ``normal market conditions'' is defined in NYSE
Arca Rule 8.600-E(c)(5).
    \9\ The Reference Benchmark will be published on the Fund's
website. The Trust will specify the name of the Reference Benchmark
in an amendment to the Registration Statement prior to commencement
of trading in the Fund's Shares.
    \10\ Swaps on the Reference Benchmark are included in
``Commodity Investments'' as defined below.
    \11\ For purposes of this filing, cash equivalents are the
short-term instruments enumerated in Commentary .01(c) to Rule
8.600-E.
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    The Fund intends to follow a multifactor strategy reflected by the
Reference Benchmark, which equally weights three sub-indices designed
to provide exposure to carry, momentum, and value factors. The Fund
will invest in financial instruments described below that provide
exposure to commodities and not in the physical commodities themselves.
The ``carry'' sub-index emphasizes commodities and contract months with
the greatest degree of backwardation or lowest degree of contango.\12\
Second, the ``momentum''

sub-index underweights or overweights commodities based on the strength
of performance patterns over multiple time periods. Third, the
``value'' sub-index measures value for each commodity by the ratio of
its 3-month average spot price to its 5-year average. Sector weights
are held constant versus a broad non-factor weighted commodity index,
but within each sector, weights of individual commodities are tilted to
favor those with the lowest valuation ratio. Within each sub-index,
contract months are selected to maximize backwardation and minimize
contango.
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    \12\ According to the Registration Statement, in order to
maintain exposure to a futures contract on a particular commodity,
an investor must sell the position in the expiring contract and buy
a new position in a contract with a later delivery month, which is
referred to as ``rolling.'' If the price for the new futures
contract is less than the price of the expiring contract, then the
market for the commodity is said to be in ``backwardation.'' In
these markets, roll returns are positive, which is referred to as
``positive carry.'' The term ``contango'' is used to describe a
market in which the price for a new futures contract is more than
the price of the expiring contract. In these markets, roll returns
are negative, which is referred to as ``negative carry.'' The
``carry'' sub-index seeks to employ a positive carry strategy that
emphasizes commodities and futures contract months with the greatest
degree of backwardation and lowest degree of contango, resulting in
net gains through positive roll returns.
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    The Fund expects to obtain a substantial amount of its exposure to
the carry, momentum, and value strategies by entering into total return
swaps that pay the returns of the commodity futures contracts
referenced from time to time in the Reference Benchmark. The Reference
Benchmark includes 22 futures contracts on physical agricultural,
energy, precious metals, and industrial metals listed on U.S. regulated
futures exchanges.
    The Fund (through its Subsidiary (as defined below)) may hold the
following listed derivative instruments: Futures, forwards, options and
swaps (including swaps referencing the Reference Benchmark) on
commodities, currencies and financial instruments (e.g., stocks, fixed
income, interest rates, U.S. Treasuries, and volatility) or a basket or
index of any of the foregoing (collectively, ``Listed
Derivatives'').\13\ Listed Derivatives will comply with the criteria in
Commentary .01(d) of NYSE Arca Rule 8.600-E.
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    \13\ Examples of Listed Derivatives the Fund may invest in
include: Exchange traded futures contracts similar to those found in
the Reference Benchmark, exchange traded futures contracts on the
Reference Benchmark, swaps on commodity futures contracts similar to
those found in the Reference Benchmark, as well as futures and
options that correlate to the investment returns of commodities
without investing directly in physical commodities.
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    The Fund (through its Subsidiary (as defined below)) may hold the
following over-the-counter (``OTC'') derivative instruments: Forwards,
options and swaps (including swaps referencing the Reference Benchmark)
on commodities, currencies and financial instruments (e.g., stocks,
fixed income, interest rates, and volatility) or a basket or index of
any of the foregoing (collectively, ``OTC Derivatives'',\14\ and
together with Listed Derivatives, ``Commodity Investments'').\15\
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    \14\ As discussed below under ``Application of Generic Listing
Requirements'' below, the Fund's and the Subsidiary's holdings in
OTC Derivatives will not comply with the criteria in Commentary
.01(e) of NYSE Arca Rule 8.600-E.
    \15\ Examples of OTC Derivatives the Fund may invest in include
swaps on commodity futures contracts similar to those found in the
Reference Benchmark, options that correlate to the investment
returns of commodities without investing directly in physical
commodities, and OTC commodity-linked notes.
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    The Fund's exposure to Commodity Investments is obtained by
investing through a wholly-owned subsidiary organized in the Cayman
Islands (the ``Subsidiary'').\16\ The Subsidiary is advised by BFA and
has the same investment objective as the Fund.
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    \16\ All statements included in this filing related to the
Fund's investments and restrictions are applicable to the Fund and
Subsidiary collectively.
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    In compliance with the requirements of Sub-Chapter M of the
Internal Revenue Code of 1986, the Fund may invest up to 25% of its
total assets in the Subsidiary. The Fund's Commodity Investments held
in the Subsidiary are intended to provide the Fund with exposure to
broad commodities.
    The Fund may hold cash, cash equivalents and fixed income
securities other than cash equivalents, as described further below.
    Specifically, the Fund may invest in Short-Term Fixed Income
Securities (as defined below) other than cash equivalents on an ongoing
basis to provide liquidity or for other reasons.\17\ Short-Term Fixed
Income Securities will have a maturity of no longer than 397 days and
include the following: (i) Money market instruments; (ii) obligations
issued or guaranteed by the U.S. government, its agencies or
instrumentalities (including government-sponsored enterprises); (iii)
negotiable certificates of deposit, bankers' acceptances, fixed-time
deposits and other obligations of U.S. and non-U.S. banks (including
non-U.S. branches) and similar institutions; (iv) commercial paper; (v)
non-convertible corporate debt securities (e.g., bonds and debentures);
(vi) repurchase agreements; (vii) short-term U.S. dollar-denominated
obligations of non-U.S. banks (including U.S. branches) that, in the
opinion of BFA, are of comparable quality to obligations of U. S. banks
that may be purchased by the Fund; (viii) and sovereign obligations
(collectively, ``Short-Term Fixed Income Securities''). Any of these
securities may be purchased on a current or forward-settled basis.\18\
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    \17\ As discussed under ``Application of Generic Listing
Requirements'', below, the Exchange proposes that such Short-Term
Fixed Income Securities be excluded from the requirements of
Commentary .01(b)(1)-(4) to NYSE Arca Rule 8.600-E.
    \18\ To the extent that the Fund and the Subsidiary invest in
cash and Short-Term Fixed Income Securities that are cash
equivalents (i.e., that have maturities of less than 3 months) as
specified in Commentary .01(c) to NYSE Arca Rule 8.600-E, such
investments will comply with Commentary .01(c) and may be held
without limitation. Non-convertible corporate debt securities and
sovereign obligations are not included as cash equivalents in
Commentary .01(c).
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    The Fund also may invest in fixed income securities as defined in
Commentary .01(b) to NYSE Arca Rule 8.600-E, other than cash
equivalents and Short-Term Fixed Income Securities, with remaining
maturities longer than 397 days (``Fixed Income Securities''). Such
Fixed Income Securities will comply with requirements of Commentary
.01(b) to NYSE Arca Rule 8.600-E.
    The Subsidiary may hold cash and cash equivalents.
    The Fund will seek to gain exposure to swaps and other Commodity
Investments by investing in its Subsidiary. The Fund wholly owns and
controls the Subsidiary, and the Fund and the Subsidiary are managed by
BFA. The Subsidiary is not an investment company registered under the
1940 Act and is a company organized under the laws of the Cayman
Islands.
    The Trust's Board of Trustees has oversight responsibility for the
investment activities of the Fund, including its investment in the
Subsidiary, and the Fund's role as sole shareholder of the Subsidiary.
    The Fund and the Subsidiary will not invest in securities or other
financial instruments that have not been described in this proposed
rule change.
Other Restrictions
    The Fund's investments, including derivatives, will be consistent
with the Fund's investment objective and will not be used to enhance
leverage (although certain derivatives and other investments may result
in leverage). That is, the Fund's investments will not be used to seek
performance that is the multiple or inverse multiple (e.g., 2X or -3X)
of the Fund's Reference Benchmark.
Use of Derivatives by the Fund
    The Fund may invest in the types of derivatives described in the
``Principal Investments'' section above for the purposes described in
that section. Investments in derivative instruments will be made in
accordance with the Fund's investment objective and policies.
    To limit the potential risk associated with such transactions, the
Fund will enter into offsetting transactions or segregate or
``earmark'' assets

determined to be liquid by the Adviser in accordance with procedures
established by the Trust's Board of Trustees (the ``Board''). In
addition, the Fund has included appropriate risk disclosure in its
offering documents, including leveraging risk. Leveraging risk is the
risk that certain transactions of the Fund, including the Fund's use of
derivatives, may give rise to leverage, causing the Fund to be more
volatile than if it had not been leveraged.
Impact on Arbitrage Mechanism
    The Adviser believes there will be minimal, if any, impact to the
arbitrage mechanism as a result of the Fund's use of derivatives. The
Adviser understands that market makers and participants should be able
to value derivatives as long as the positions are disclosed with
relevant information. The Adviser believes that the price at which
Shares of the Fund trade will continue to be disciplined by arbitrage
opportunities created by the ability to purchase or redeem Shares of
the Fund at their net asset value (``NAV''), which should ensure that
Shares of the Fund will not trade at a material discount or premium in
relation to their NAV.
    The Adviser does not believe there will be any significant impacts
to the settlement or operational aspects of the Fund's arbitrage
mechanism due to the use of derivatives.
Creation and Redemption of Shares
    According to the Registration Statement, the Trust will issue and
sell Shares of the Fund only in Creation Units on a continuous basis
through the Distributor or its agent at a price based on the Fund's NAV
next determined after receipt, on any business day of an order received
by the Distributor or its agent in proper form. The size of a Creation
Unit is 50,000 Shares. The Trust may increase or decrease the number of
the Fund's Shares that constitute a Creation Unit.
    The consideration for purchase of Creation Units of the Fund is
generally cash (which may include the currency in which the underlying
securities are denominated). However, in some cases the consideration
consists of an in-kind deposit of a designated portfolio of securities
(``Deposit Securities'') and the Cash Component computed as described
below. Together, the Deposit Securities and the Cash Component
constitute the ``Fund Deposit,'' which, when combined with the Fund's
portfolio securities, is designed to generate performance that has a
collective investment profile similar to that of the Reference
Benchmark. The Fund Deposit represents the minimum initial and
subsequent investment amount for a Creation Unit of the Fund.
    The ``Cash Component'' is an amount equal to the difference between
the NAV of the shares (per Creation Unit) and the ``Deposit Amount,''
which is an amount equal to the market value of the Deposit Securities,
and serves to compensate for any differences between the NAV per
Creation Unit and the Deposit Amount.
    The Fund's current policy is to accept cash in substitution for the
Deposit Securities it might otherwise accept as in-kind consideration
for the purchase of Creation Units. The Fund may, at times, elect to
receive Deposit Securities (i.e., the in-kind deposit of a designated
portfolio of securities) and a Cash Component as consideration for the
purchase of Creation Units. If the Fund elects to accept Deposit
Securities, a purchaser's delivery of the Deposit Securities together
with the Cash Component will constitute the ``Fund Deposit,'' which
will represent the consideration for a Creation Unit of the Fund.
    The Fund reserves the right to permit or require the substitution
of a ``cash in lieu'' amount to be added to the Cash Component to
replace any Deposit Security that may not be available in sufficient
quantity for delivery or that may not be eligible for transfer through
the Depository Trust Company (``DTC'') or the clearing process (as
discussed below) or that the ``Authorized Participant'' as defined
below, is not able to trade due to a trading restriction, during times
the Fund has elected to receive Deposit Securities. The Fund also
reserves the right to permit or require a ``cash in lieu'' amount in
certain circumstances.
    To be eligible to place orders with the Distributor and to create a
Creation Unit of the Fund, an entity must be: (i) A ``Participating
Party,'' i.e., a broker-dealer or other participant in the clearing
process through the Continuous Net Settlement System of the National
Securities Clearing Corporation (``NSCC'') (the ``Clearing Process''),
a clearing agency that is registered with the SEC, or (ii) a DTC
Participant, and must have executed an agreement with the Distributor,
with respect to creations and redemptions of Creation Units
(``Authorized Participant Agreement'') (discussed below). A
Participating Party or DTC Participant who has executed an Authorized
Participant Agreement is referred to as an ``Authorized Participant.
    To initiate an order for a Creation Unit, an Authorized Participant
must submit to the Distributor or its agent an irrevocable order to
purchase shares of the Fund, in proper form, generally before 4:00
p.m., Eastern time on any business day to receive that day's NAV.
    Shares of the Fund may be redeemed by only in Creation Units at
their NAV next determined after receipt of a redemption request in
proper form by the Distributor or its agent and only on a business day.
The Fund generally redeems Creation Units solely for cash (which may
include the currency in which the underlying securities are
denominated).
    BFA makes available through the NSCC, prior to the opening of
business on the Exchange on each business day, the designated portfolio
of securities (including any portion of such securities for which cash
may be substituted) that will be applicable (subject to possible
amendment or correction) to redemption requests received in proper form
(as defined below) on that day (``Fund Securities''), and an amount of
cash (the ``Cash Amount,'' as described below). Such Fund Securities
and the corresponding Cash Amount (each subject to possible amendment
or correction) are applicable, in order to effect redemptions of
Creation Units of the Fund until such time as the next announced
composition of the Fund Securities and Cash Amount is made available.
Where redemptions are permitted in-kind, Fund Securities received on
redemption may not be identical to Deposit Securities that are
applicable to creations of Creation Units. Procedures and requirements
governing redemption transactions are set forth in the handbook for
Authorized Participants and may change from time to time.
    The Trust may, in its sole discretion, substitute a ``cash in
lieu'' amount to replace any Fund Security. The Trust also reserves the
right to permit or require a ``cash in lieu'' amount in certain
circumstances. The amount of cash paid out in such cases will be
equivalent to the value of the substituted security listed as a Fund
Security. In the event that the Fund Securities have a value greater
than the NAV of the shares, a compensating cash payment equal to the
difference is required to be made by or through an Authorized
Participant by the redeeming shareholder. The Fund generally redeems
Creation Units for cash.
    Redemption requests for Creation Units of the Fund must be
submitted to the Distributor or its agent by or through an Authorized
Participant. An Authorized Participant must submit an irrevocable
request to redeem shares of the Fund generally before 4:00 p.m.,
Eastern time on any business day in order to receive that day's NAV.

Application of Generic Listing Requirements
    The Exchange is submitting this proposed rule change because the
portfolio for the Fund will not meet all of the ``generic'' listing
requirements of Commentary .01 to NYSE Arca Rule 8.600-E applicable to
the listing of Managed Fund Shares. The Fund's portfolio will meet all
such requirements except for those set forth in Commentary .01 (b)(1)-
(4) (with respect to Short-Term Fixed Income Securities) and (e) (with
respect to OTC Derivatives), as described below.
    The Fund's Short-Term Fixed Income Securities will not comply with
the requirements set forth in Commentary .01(b)(1)-(4) to NYSE Arca
Rule 8.600-E.\19\ While the requirements set forth in Commentary
.01(b)(1)-(4) include rules intended to ensure that the fixed income
securities included in a fund's portfolio are sufficiently large and
diverse, and have sufficient publicly available information regarding
the issuances. The Exchange believes that any such concerns, regarding
non-compliance are mitigated by the types of instruments that the Fund
would hold. The Fund's Short-Term Fixed Income Securities primarily
will include those instruments that are included in the definition of
cash and cash equivalents, but are not considered cash and cash
equivalents because they have maturities of three months or longer. The
Exchange believes, however, that, because all Short-Term Fixed Income
Securities, including non-convertible corporate debt securities and
sovereign obligations (which are not cash equivalents as enumerated in
Commentary .01(c) to Rule 8.600-E), are highly liquid they are less
susceptible than other types of fixed income instruments both to price
manipulation and volatility and that the holdings as proposed are
generally consistent with the policy concerns which Commentary
.01(b)(1)-(4) is intended to address. Because the Short-Term Fixed
Income Securities will consist of high-quality fixed income securities
described above, the Exchange believes that the policy concerns that
Commentary .01(b)(1)-(4) is intended to address are otherwise mitigated
and that the Fund should be permitted to hold these securities in a
manner that may not comply with Commentary .01(b)(1)-(4).
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    \19\ Commentary .01(b)(1)-(4) to NYSE Arca Rule 8.600-E provides
as follows:
    (b) Fixed Income--Fixed income securities are debt securities
that are notes, bonds, debentures or evidence of indebtedness that
include, but are not limited to, U.S. Department of Treasury
securities (``Treasury Securities''), government-sponsored entity
securities (``GSE Securities''), municipal securities, trust
preferred securities, supranational debt and debt of a foreign
country or a subdivision thereof, investment grade and high yield
corporate debt, bank loans, mortgage and asset backed securities,
and commercial paper. To the extent that a portfolio includes
convertible securities, the fixed income security into which such
security is converted shall meet the criteria of this Commentary
.01(b) after converting. The components of the fixed income portion
of a portfolio shall meet the following criteria initially and on a
continuing basis:
    (1) Components that in the aggregate account for at least 75% of
the fixed income weight of the portfolio each shall have a minimum
original principal amount outstanding of $100 million or more;
    (2) No component fixed-income security (excluding Treasury
Securities and GSE Securities) shall represent more than 30% of the
fixed income weight of the portfolio, and the five most heavily
weighted component fixed income securities in the portfolio
(excluding Treasury Securities and GSE Securities) shall not in the
aggregate account for more than 65% of the fixed income weight of
the portfolio;
    (3) An underlying portfolio (excluding exempted securities) that
includes fixed income securities shall include a minimum of 13 non-
affiliated issuers, provided, however, that there shall be no
minimum number of non-affiliated issuers required for fixed income
securities if at least 70% of the weight of the portfolio consists
of equity securities as described in Commentary .01(a) above;
    (4) Component securities that in aggregate account for at least
90% of the fixed income weight of the portfolio must be either (a)
from issuers that are required to file reports pursuant to Sections
13 and 15(d) of the Securities Exchange Act of 1934; (b) from
issuers that have a worldwide market value of its outstanding common
equity held by non-affiliates of $700 million or more; (c) from
issuers that have outstanding securities that are notes, bonds
debentures, or evidence of indebtedness having a total remaining
principal amount of at least $1 billion; (d) exempted securities as
defined in Section 3(a)(12) of the Securities Exchange Act of 1934;
or (e) from issuers that are a government of a foreign country or a
political subdivision of a foreign country; and [sic]
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    The Fund's portfolio also will not comply with the requirements set
forth in Commentary .01(e) (with respect to OTC Derivatives) to NYSE
Arca Rule 8.600-E.\20\ Specifically, the Fund's investments in OTC
Derivatives may exceed 20% of Fund assets, calculated as the aggregate
gross notional value of such OTC Derivatives. The Exchange proposes
that up to 60% of the Fund's assets (calculated as the aggregate gross
notional value) may be invested in OTC Derivatives. The Adviser
believes that it is important to provide the Fund with additional
flexibility to manage risk associated with its investments. Depending
on market conditions, it may be critical that the Fund be able to
utilize available OTC Derivatives to efficiently gain exposure to the
multiple commodities that underlie the Reference Benchmark, as well as
commodity futures contracts similar to those found in the Reference
Benchmark.
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    \20\ Commentary .01(e) of NYSE Arca Rule 8.600-E provides as
follows: ``The portfolio may hold OTC derivatives, including
forwards, options and swaps on commodities, currencies and financial
instruments (e.g., stocks, fixed income, interest rates, and
volatility) or a basket or index of any of the foregoing; however,
on both an initial and continuing basis, no more than 20% of the
assets in the portfolio may be invested in OTC derivatives. For
purposes of calculating this limitation, a portfolio's investment in
OTC derivatives will be calculated as the aggregate gross notional
value of the OTC derivatives.''
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    OTC Derivatives can be tailored to provide specific exposure to the
Fund's Reference Benchmark, as well as commodity futures contracts
similar to those found in the Reference Benchmark, allowing the Fund to
more efficiently meet its investment objective. For example, the
Reference Benchmark is composed of 22 futures contracts across 20
physical commodities, which may not be sufficiently liquid and would
not provide the commodity exposure the Fund requires to meet its
investment objective if the Fund were to invest in the futures
directly. A total return swap can be structured to provide exposure to
the same futures contracts as exist in the Reference Benchmark, as well
as commodity futures contracts similar to those found in the Reference
Benchmark, while providing sufficient efficiency to allow the Fund to
more easily meet its investment objective.
    In addition, if the Fund were to gain commodity exposure
exclusively through the use of listed futures, the Fund's holdings in
Listed Derivatives would be subject to position limits and
accountability levels established by an exchange. Such limitations
would restrict the Fund's ability to gain efficient exposure to the
commodities in the Reference Benchmark, or futures contracts similar to
those found in the Reference Benchmark, thereby impeding the Fund's
ability to satisfy its investment objective.
    The Adviser represents that the basket or index on which much of
the Fund's OTC Derivatives will be based will satisfy the criteria
applicable to holdings in Listed Derivatives in Commentary .01(d)(2) on
an initial and continued listing basis.\21\ With respect to the Fund's
holdings in OTC Derivatives, the aggregate gross notional value of OTC
Derivatives based on any five or fewer underlying reference assets will
not exceed 65% of the weight of the portfolio (including gross notional
exposures), and the aggregate gross

notional value of OTC Derivatives based on any single underlying
reference asset will not exceed 30% of the weight of the portfolio
(including gross notional exposures). In addition, the Adviser
represents that futures on all commodities in the Reference Benchmark
are traded on futures exchanges that are members of the Intermarket
Surveillance Group (``ISG'').
---------------------------------------------------------------------------

    \21\ Commentary .01(d)(2) to Rule 8.600-E provides that, with
respect to a fund's portfolio, the aggregate gross notional value of
listed derivatives based on any five or fewer underlying reference
assets shall not exceed 65% of the weight of the portfolio
(including gross notional exposures), and the aggregate gross
notional value of listed derivatives based on any single underlying
reference asset shall not exceed 30% of the weight of the portfolio
(including gross notional exposures).
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    The Exchange notes that, other than Commentary .01(b)(1)-(4) (with
respect to Short-Term Fixed Income Securities) and .01(e) (with respect
to OTC Derivatives) to Rule 8.600-E, as described above, the Fund's
portfolio will meet all other requirements of Rule 8.600-E.
Availability of Information
    The Fund's website (www.iShares.com) will include the prospectus
for the Fund that may be downloaded. The Fund's website will include
additional quantitative information updated on a daily basis including,
for the Fund, (1) daily trading volume, the prior business day's
reported closing price, NAV and midpoint of the bid/ask spread at the
time of calculation of such NAV (the ``Bid/Ask Price''),\22\ and a
calculation of the premium and discount of the Bid/Ask Price against
the NAV, and (2) data in chart format displaying the frequency
distribution of discounts and premiums of the daily Bid/Ask Price
against the NAV, within appropriate ranges, for each of the four
previous calendar quarters. On each business day, before commencement
of trading in Shares in the Core Trading Session on the Exchange, the
Fund will disclose on its website the Disclosed Portfolio as defined in
NYSE Arca Rule 8.600-E(c)(2) that forms the basis for the Fund's
calculation of NAV at the end of the business day.\23\
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    \22\ The Bid/Ask Price of the Fund's Shares will be determined
using the mid-point of the highest bid and the lowest offer on the
Exchange as of the time of calculation of the Fund's NAV. The
records relating to Bid/Ask Prices will be retained by the Fund and
its service providers.
    \23\ Under accounting procedures followed by the Fund, trades
made on the prior business day (``T'') will be booked and reflected
in NAV on the current business day (``T+1''). Accordingly, the Fund
will be able to disclose at the beginning of the business day the
portfolio that will form the basis for the NAV calculation at the
end of the business day.
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    On a daily basis, the Fund will disclose the information required
under NYSE Arca Rule 8.600-E(c)(2) to the extent applicable. The
website information will be publicly available at no charge.
    In addition, a basket composition file, which includes the asset
names and share quantities, if applicable, required to be delivered in
exchange for the Fund's Shares, together with estimates and actual cash
components, will be publicly disseminated daily prior to the opening of
the Exchange via the NSCC. The basket represents one Creation Unit of
the Fund. Authorized Participants may refer to the basket composition
file for information regarding financial instruments that may comprise
the Fund's basket on a given day.
    Investors can also obtain the Trust's Statement of Additional
Information (``SAI''), the Fund's Shareholder Reports, and the Fund's
Forms N-CSR and Forms N-SAR, filed twice a year. The Fund's SAI and
Shareholder Reports will be available free upon request from the Trust,
and those documents and the Form N-CSR, Form N-PX and Form N-SAR may be
viewed on-screen or downloaded from the Commission's website at
www.sec.gov.
    Intra-day and closing price information regarding futures and other
Listed Derivatives will be available from the exchange on which such
instruments are traded and from major market data vendors. Price
information regarding cash equivalents, Commodity Investments, Short-
Term Fixed Income Securities, and Fixed Income Securities also will be
available from major market data vendors. Additionally, the Trade
Reporting and Compliance Engine (``TRACE'') of the Financial Industry
Regulatory Authority (``FINRA'') will be a source of price information
for certain fixed income securities to the extent transactions in such
securities are reported to TRACE.\24\ Price information regarding U.S.
government securities and other cash equivalents generally may be
obtained from brokers and dealers who make markets in such securities
or through nationally recognized pricing services through subscription
agreements. The BCOM index methodology, constituent list, and index
price are available via Bloomberg.
---------------------------------------------------------------------------

    \24\ Broker-dealers that are FINRA member firms have an
obligation to report transactions in specified debt securities to
TRACE to the extent required under applicable FINRA rules.
Generally, such debt securities will have at issuance a maturity
that exceeds one calendar year. For fixed income securities that are
not reported to TRACE, (i) intraday price quotations will generally
be available from broker-dealers and trading platforms (as
applicable) and (ii) price information will be available from feeds
from market data vendors, published or other public sources, or
online information services, as described above.
---------------------------------------------------------------------------

    Information regarding market price and trading volume of the Shares
will be continually available on a real-time basis throughout the day
on brokers' computer screens and other electronic services. Information
regarding the previous day's closing price and trading volume
information for the Shares will be published daily in the financial
section of newspapers.
    Quotation and last sale information for the Shares will be
available via the Consolidated Tape Association (``CTA'') high-speed
line. Exchange-traded options quotation and last sale information for
options cleared via the Options Clearing Corporation are available via
the Options Price Reporting Authority. In addition, the Portfolio
Indicative Value (``PIV''), as defined in NYSE Arca Rule 8.600-E(c)(3),
will be widely disseminated by one or more major market data vendors at
least every 15 seconds during the Core Trading Session.
Trading Halts
    With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of the Fund.\25\ Trading in Shares of the Fund
will be halted if the circuit breaker parameters in NYSE Arca Rule
7.12-E have been reached. Trading also may be halted because of market
conditions or for reasons that, in the view of the Exchange, make
trading in the Shares inadvisable. Trading in the Fund's Shares also
will be subject to Rule 8.600-E(d)(2)(D) (``Trading Halts'').
---------------------------------------------------------------------------

    \25\ See NYSE Arca Rule 7.12-E.
---------------------------------------------------------------------------

Trading Rules
    The Exchange 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. Shares will trade on
the NYSE Arca Marketplace from 4 a.m. to 8 p.m., E.T. in accordance
with NYSE Arca Rule 7.34-E (Early, Core, and Late Trading Sessions).
The Exchange has appropriate rules to facilitate transactions in the
Shares during all trading sessions. As provided in NYSE Arca Rule 7.6-
E, the minimum price variation (``MPV'') for quoting and entry of
orders in equity securities traded on the NYSE Arca Marketplace is
$0.01, with the exception of securities that are priced less than $1.00
for which the MPV for order entry is $0.0001.
    With the exception of the requirements of Commentary .01(b)(1)-(4)
(with respect to Short-Term Fixed Income Securities) and (e) (with
respect to OTC Derivatives) to Rule 8.600-E as described above in
``Application of Generic Listing Requirements,'' the Shares of the Fund
will conform to the initial and continued listing criteria under NYSE
Arca Rule 8.600-E. Consistent with NYSE Arca Rule 8.600-E(d)(2)(B)(ii),
the Adviser will

implement and maintain, or be subject to, procedures designed to
prevent the use and dissemination of material non-public information
regarding the actual components of the Fund's portfolio. The Exchange
represents that, for initial and continued listing, the Fund will be in
compliance with Rule 10A-3 \26\ under the Act, as provided by NYSE Arca
Rule 5.3-E. A minimum of 100,000 Shares will be outstanding at the
commencement of trading on the Exchange. 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. The
Fund's investments will be consistent with its investment goal and will
not be used to provide multiple returns of a benchmark or to produce
leveraged returns.
---------------------------------------------------------------------------

    \26\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares will be subject
to the existing trading surveillances, administered by FINRA on behalf
of the Exchange, or by regulatory staff of the Exchange, which are
designed to detect violations of Exchange rules and applicable federal
securities laws. The Exchange represents that 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.\27\
---------------------------------------------------------------------------

    \27\ FINRA conducts cross-market surveillances on behalf of the
Exchange pursuant to a regulatory services agreement. The Exchange
is responsible for FINRA's performance under this regulatory
services agreement.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Shares, futures, and
certain listed options with other markets and other entities that are
members of the ISG, and the Exchange or FINRA, on behalf of the
Exchange, or both, may obtain trading information regarding trading in
such securities and financial instruments from such markets and other
entities.\28\ In addition, the Exchange may obtain information
regarding trading in such securities and financial instruments from
markets and other entities that are members of ISG or with which the
Exchange has in place a comprehensive surveillance sharing agreement.
In addition, 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 TRACE.
---------------------------------------------------------------------------

    \28\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of the
Disclosed Portfolio may trade on markets that are members of ISG or
with which the Exchange has in place a comprehensive surveillance
sharing agreement.
---------------------------------------------------------------------------

    In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
    All statements and representations made in this filing regarding
(a) the description of the portfolio or reference assets, (b)
limitations on portfolio holdings or reference assets, or (c) the
applicability of Exchange listing rules specified in this rule filing
shall constitute continued listing requirements for listing the Shares
of the Fund on the Exchange.
    The issuer must notify the Exchange of any failure by the Fund to
comply with the continued listing requirements, and, pursuant to its
obligations under Section 19(g)(1) of the Act, the Exchange will
monitor for compliance with the continued listing requirements. If the
Fund is not in compliance with the applicable listing requirements, the
Exchange will commence delisting procedures under NYSE Arca Rule 5.5-
E(m).
Information Bulletin
    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. Specifically, the Bulletin will discuss the following: (1) The
procedures for purchases and redemptions of Shares in Creation Unit
aggregations (and that Shares are not individually redeemable); (2)
NYSE Arca Rule 9.2-E(a), which imposes a duty of due diligence on its
Equity Trading Permit Holders to learn the essential facts relating to
every customer prior to trading the Shares; (3) the risks involved in
trading the Shares during the Early and Late Trading Sessions when an
updated PIV will not be calculated or publicly disseminated; (4) how
information regarding the PIV and the Disclosed Portfolio is
disseminated; (5) 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 (6)
trading information.
    In addition, the Bulletin will reference that the Fund is subject
to various fees and expenses described in the Registration Statement.
The Bulletin will discuss any exemptive, no-action, and interpretive
relief granted by the Commission from any rules under the Act. The
Bulletin will also disclose that the NAV for the Shares will be
calculated after 4:00 p.m., Eastern time each trading day.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \29\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \29\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Rule 8.600-E. The
Exchange has in place surveillance procedures that are adequate to
properly monitor trading in the Shares in all trading sessions and to
deter and detect violations of Exchange rules and applicable federal
securities laws. The Exchange or FINRA, on behalf of the Exchange, or
both, will communicate as needed regarding trading in the Shares,
futures, and certain listed options with other markets and other
entities that are members of the ISG, and the Exchange or FINRA, on
behalf of the Exchange, or both, may obtain trading information
regarding trading in such securities and financial instruments from
such markets and other entities. In addition, the Exchange may obtain
information regarding trading in such securities and financial
instruments from markets and other entities that are members of ISG or
with which the Exchange has in place a comprehensive surveillance
sharing agreement. In addition, 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 TRACE. The Adviser is
not registered as a broker-dealer, but is affiliated with affiliated

with a broker-dealer, and has implemented and will maintain a fire wall
with respect to its broker-dealer affiliate regarding access to
information concerning the composition and/or changes to the portfolio.
    The Exchange notes that, other than Commentary .01(b)(1)-(4) (with
respect to Short-Term Fixed Income Securities) and Commentary .01 (e)
(with respect to OTC Derivatives) to Rule 8.600-E, as described above,
the Fund's portfolio will meet all other requirements of Rule 8.600-E.
    The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that 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, a large amount of
information will be publicly available regarding the Fund and the
Shares, thereby promoting market transparency. Quotation and last sale
information for the Shares will be available via the CTA high-speed
line. Prior to the commencement of trading, the Exchange will inform
its Equity Trading Permit Holders in an Information Bulletin of the
special characteristics and risks associated with trading the Shares.
Trading in Shares of the Fund will be halted if the circuit breaker
parameters in NYSE Arca Rule 7.12-E 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 Rule 8.600-E (d)(2)(D), which sets forth
circumstances under which Shares of the Fund may be halted. In
addition, as noted above, investors will have ready access to
information regarding the Fund's holdings, NAV, the PIV, the Disclosed
Portfolio, and quotation and last sale information for the Shares.
    With respect to the Fund's proposed non-compliance with Commentary
.01(b)(1)-(4) (with respect to Short-Term Fixed Income Securities),
while the requirements set forth in Commentary.01(b) includes rules
intended to ensure that the fixed income securities included in a
fund's portfolio are sufficiently large and diverse and have sufficient
publicly available information regarding the issuances. The Exchange
believes that any concerns regarding non-compliance are mitigated by
the types of instruments that the Fund would hold. The Fund's Short-
Term Fixed Income Securities primarily will include those instruments
that are included in the definition of cash and cash equivalents, but
are not considered cash and cash equivalents because they have
maturities of three months or longer. Short-Term Fixed Income
Securities that are cash equivalents under Commentary .01(c) to Rule
8.600-E (that is, short-term instruments with maturities of less than
three months, as described in Commentary .01(c)(2)) would comply with
Commentary .01(c) and could be held without limit. The Exchange
believes, however, that because all Short-Term Fixed Income Securities,
including non-convertible corporate debt securities and sovereign
obligations, are high quality instruments and are highly liquid they
are less susceptible than other types of fixed income instruments both
to price manipulation and volatility and that the holdings as proposed
are generally consistent with the policy concerns which Commentary
.01(b) is intended to address. Because of these factors, the Exchange
believes that the policy concerns that Commentary .01(b) is intended to
address are otherwise mitigated and that the Fund should be permitted
to hold these securities in a manner that may not comply with
Commentary .01(b).
    With respect to the Fund's proposed non-compliance with the
requirements set forth in Commentary .01(e) (with respect to OTC
Derivatives) to NYSE Arca Rule 8.600-E,\30\ specifically the proposal
that up to 60% of the Fund's assets (calculated as the aggregate gross
notional value) may be invested in OTC Derivatives, the Adviser
believes that it is important to provide the Fund with additional
flexibility to manage risk associated with its investments. Depending
on market conditions, it may be critical that the Fund be able to
utilize available OTC Derivatives to efficiently gain exposure to the
multiple commodities markets that underlie the Reference Benchmark.\31\
---------------------------------------------------------------------------

    \30\ See note 20, supra.
    \31\ The Commission has previously approved an exception from
requirements set forth in Commentary .01(e) relating to investments
in OTC derivatives similar to those proposed with respect to the
Fund in Securities Exchange Act Release No. 80657 (May 11, 2017), 82
FR 22702 (May 17, 2017) (SR-NYSEArca-2017-09) (Notice of Filing of
Amendment No. 2 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 2, Regarding
Investments of the Janus Short Duration Income ETF Listed Under NYSE
Arca Equities Rule 8.600).
---------------------------------------------------------------------------

    OTC Derivatives can be tailored to provide specific exposure to the
Fund's Reference Benchmark, allowing the Fund to more efficiently meet
its investment objective. For example, the Reference Benchmark is
composed of 22 futures contracts across 20 physical commodities, which
may not be sufficiently liquid and would not provide the commodity
exposure the Fund requires to meet its investment objective if the Fund
were to invest in the futures directly. A total return swap can be
structured to provide exposure to the same futures contracts as exist
in the Reference Benchmark, while providing sufficient efficiency to
allow the Fund to more easily meet its investment objective.
    In addition, if the Fund were to gain commodity exposure
exclusively through the use of listed futures, the Fund's holdings in
Listed Derivatives would be subject to position limits and
accountability levels established by an exchange. Such limitations
would restrict the Fund's ability to gain efficient exposure to the
commodities in the Reference Benchmark, thereby impeding the Fund's
ability to satisfy its investment objective.
    The Adviser represents that the basket or index on which much of
the Fund's OTC Derivatives will be based will satisfy the criteria
applicable to holdings in Listed Derivatives in Commentary .01(d)(2) on
an initial and continued listing basis.\32\ With respect to the Fund's
holdings in OTC Derivatives, the aggregate gross notional value of OTC
Derivatives based on any five or fewer underlying reference assets will
not exceed 65% of the weight of the portfolio (including gross notional
exposures), and the aggregate gross notional value of OTC Derivatives
based on any single underlying reference asset will not exceed 30% of
the weight of the portfolio (including gross notional exposures).
Futures on all commodities in the Reference Benchmark are traded on
futures exchanges that are members of the ISG.
---------------------------------------------------------------------------

    \32\ See note 21, supra.
---------------------------------------------------------------------------

    The Adviser represents that it is in the best interests of the
Fund's shareholders for the Fund to be allowed to reduce commodities-
related risks arising from the Fund's investments using the most
efficient financial instruments. While certain risks can be hedged via
Listed Derivatives, OTC Derivatives can be customized to hedge against
precise risks. Accordingly, the Adviser believes that OTC Derivatives
may frequently be a more efficient hedging vehicle than Listed
Derivatives. Depending on market conditions, it may be critical that
the Fund be able to utilize available OTC Derivatives for this purpose
to gain exposure to the commodities in the Reference Benchmark in an
efficient manner. Therefore, the Exchange believes that increasing the
percentage limit in Commentary .01(e) (with

respect to OTC Derivatives), as described above, to the Fund's
investments in OTC Derivatives would help protect investors and the
public interest.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an actively-managed exchange-traded product that, through permitted use
of an increased level of OTC derivatives above that currently permitted
by the generic listing requirements of Commentary .01 to NYSE Arca Rule
8.600-E, will enhance competition among market participants, to the
benefit of investors and the marketplace. As noted above, the Exchange
has in place surveillance procedures relating to trading in the Shares
and may obtain information via ISG from other exchanges that are
members of ISG or with which the Exchange has entered into a
comprehensive surveillance sharing agreement. In addition, as noted
above, investors have ready access to information regarding the Fund's
holdings, the PIV, the Disclosed Portfolio, and quotation and last sale
information for the Shares.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purpose of the Act. The Exchange notes that the
proposed rule change will facilitate the listing and trading of an
additional type of actively-managed exchange-traded product that will
enhance competition among market participants, to the benefit of
investors and the marketplace.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Section 19(b)(2) of the Act \33\ provides that within 45 days of
the date of publication of a proposed rule change or up to 90 days (i)
as the Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
---------------------------------------------------------------------------

    \33\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEArca-2018-98 on the subject line.

Paper Comments

     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-2018-98. 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 website (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 website 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 the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NYSEArca-2018-98 and should be submitted
on or before February 28, 2019

V. Notice of Designation of a Longer Period for Commission Action on
Proposed Rule Change Relating to Listing and Trading Shares of the
iShares Commodity Multi-Strategy ETF Under NYSE Arca Rule 8.600-E

    Section 19(b)(2) of the Act \34\ provides that within 45 days of
publication of notice of a proposed rule change, or within such longer
period up to 90 days as the Commission may designate if it finds such
longer period to be appropriate and publishes its reasons for so
finding, or as to which the self-regulatory organization consents, the
Commission shall either approve the proposed rule change, disapprove
the proposed rule change, or institute proceedings to determine whether
the proposed rule change should be disapproved. The 45th day after
publication of the notice for this proposed rule change is February 4,
2019.
---------------------------------------------------------------------------

    \34\ 15 U.S.C. 78s(b)(2). See also Section 19(b)(2)(E) of the
Act, 15 U.S.C. 78s(b)(2)(E)(concerning publication date).
---------------------------------------------------------------------------

    The Commission finds it appropriate to designate a longer period
within which to take action on the proposed rule change so that it has
sufficient time to consider this proposed rule change. Accordingly, the
Commission, pursuant to Section 19(b)(2) of the Act,\35\ designates
March 21, 2019, as the date by which the Commission shall either
approve or disapprove, or institute proceedings to determine whether to
disapprove, the proposed rule change (File No. SR-NYSEArca-2018-98).
---------------------------------------------------------------------------

    \35\ Id.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\36\
---------------------------------------------------------------------------

    \36\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-01387 Filed 2-6-19; 8:45 am]
 BILLING CODE 8011-01-P