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EFTA01353511

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value will be based on noncurrent Information. The qual- ity of the information reflected in the values of an implied volatility index should be evaluated in light of the depth aid liquidity of the markets for the securities in the refer- ence index and the options that are the components of the index. The realized variability indexes underlying variability options approved for trading as of the date of this Sup- plement measure the actual volatility or variance, as the case may be, of the reference index for a fixed period ending on the last trading day before the expiration date for the variability option. As of the date of this Supple- ment indicative values for a realized variability index are published once per trading day during the fixed period. but values published early in the period, which are based on a small number of observations, may vary substan- tially from the exercise settlement value. The exercise settlement amount for a realized variability option is equal to the difference between the exercise settlement value and the exercise price of the option, times a multiplier. Realized variability options that are described in this Supplement are European-style and "A.M.-settled." The initial and final values of a reference index for purposes of calculating the exercise settlement value for realized van- ability options described in this Supplement are ordina- rily calculated from the actual opening prices of the com- ponent securities of the reference index in their primary market. If a component security does not open for trad- ing, the fast reported price in the primary market may be used. OCC's rules provide for other methods of deter- mining the exercise settlement value of a reference index in extraordinary circumstances. All other values for real- ized variability indexes are calculated from the published closing value of the reference index. STRATEGY-BASED INDEXES Strategy-based indexes are complex, and their cal- culation

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