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options held by options dealers are also subject to the
mark-to-market rule and 60/40 treatment.
* * * * * * *
The conference agreement eliminates the reference
to registration with the SEC in the definition of
"options dealer" * * *. Further, the conferees intend
that the capital gain or loss status of options traded
in the normal course of an options dealer's activity in
trading options is to be determined without regard to
the identification requirement of sec. 1236. [H. Conf.
Rept. 98-861, at 899, 903, 909, 1984-3 C.B. (Vol. 2)
153, 157, 163; emphasis added.]
See also S. Prt. 98-169 (Vol. 4), at 285, 289 (1984).
Respondent contends, and Mr. Gordon does not dispute, that
each of the options that Mr. Gordon traded during 1986 as an
options market maker is a "section 1256 contract" within the
meaning of section 1256(b)(3) or (4) because each of those
options constitutes either a "nonequity option" within the
meaning of section 1256(g)(3) or a "dealer equity option" within
the meaning of section 1256(g)(4). Respondent and Mr. Gordon
have stipulated that during 1986 Mr. Gordon was registered and
operated on the AMEX as a market maker in stock options and index
options, all of which were listed and traded on the AMEX and
subject to the respective rules and regulations of that exchange
and the SEC. They thus agree that during 1986 Mr. Gordon was an
"options dealer" within the meaning of section 1256(g)(8)(A),
i.e., a "person registered with an appropriate national securi-
ties exchange as a market maker or specialist in listed options."
Respondent and Mr. Gordon have further stipulated that (1) a
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