Participant controlled mutual fund

• US 20010034641A1
• Filed: 02/09/2001
• Published: 10/25/2001
• Est. Priority Date: 02/10/2000
• Status: Abandoned Application

• Current Assignee: IPS Advisory, Inc.
• Original Assignee: IPS Advisory, Inc.
• Inventors: Loest, Robert A., DʼAmico, Gregory A.
• Application Number:
  US09/780,964
• Publication Number:
  US 20010034641A1
• Time in Patent Office: Days
• US Class Current: 705/12
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A participant controlled mutual fund is directed by participants who make the investing decisions through an intricate nominating and voting process over the Internet. The voting process is flexible in that it adjusts to the changing positions in the financial markets, thereby allowing the mutual fund to quickly take advantage of good opportunities, while preventing haste decisions in volatile markets. An advisor executes the market orders generated by the participants and monitors the mutual fund to ensure that the fund complies with applicable law.

Claims

1. A method of managing a financial investment fund having a plurality of securities, the managing being conducted by a plurality of participants, comprising:

receiving votes from the participants of the financial investment fund regarding executing a market order for a security, wherein each participant is a partial-owner of the financial investment fund;

totaling the votes to produce a total vote count;

comparing the total vote count with a market order threshold;

executing the market order, if the total vote count is greater than the market order threshold; and

wherein executing the market order for the security involves altering the composition of the financial investment fund with respect to the security.

2. The method of

claim 1

, wherein the security comprises a candidate security and receiving votes comprises receiving the votes for the candidate security, the method further including receiving nominations for security to become the candidate security.

3. The method of

claim 2

, further including:

totaling the nominations for a nominated security to produce a total nominated vote count;

comparing the total nominated vote count with a nomination threshold; and

converting the nominated security into the candidate security if the total nominated vote count exceeds the nomination threshold.

4. The method of

claim 1

, wherein executing the market order comprises purchasing the security.

5. The method of

claim 1

, wherein executing the market order comprises selling the security.

6. The method of

claim 1

, wherein the market order threshold comprises a market order percent, the method further comprising receiving the market order percent from the participants.

7. The method of

claim 6

, wherein receiving the market order percent comprises setting the market order percent based on input received from the participants on a regular basis.

8. The method of

claim 6

, wherein receiving the market order percent comprises:

receiving market order votes from the participants; and

averaging the market order votes to arrive at the market order percent.

9. The method of

claim 8

, wherein receiving market order votes and averaging the market order votes occurs on a regular basis.

10. The method of

claim 6

, wherein receiving the market order percent comprises setting a minimum market order percent.

11. The method of

claim 1

, further comprising receiving additional funds from the participants and investing the additional funds by receiving votes, totaling the votes, comparing the total vote count, and executing the market order.

12. The method of

claim 1

, wherein receiving votes comprises receiving votes for a plurality of securities.

13. The method of

claim 1

, wherein executing the market order comprises instructing a financial provider to execute the market order for the security.

14. The method of

claim 1

, further comprising reviewing the market order to ensure the market order complies with rules regarding management of the financial investment fund.

15. The method of

claim 14

, wherein reviewing comprises having an advisor oversee management of the financial investment fund.

16. A method of managing a financial investment fund having a plurality of securities, the managing being conducted by a plurality of participants, comprising:

receiving nominations from the participants of the financial investment fund recommending a market order for a security, wherein each participant is a partial-owner of the financial investment fund;

receiving nomination votes from the participants regarding the market order for the security;

totaling the nomination votes to produce a total nominated vote count;

comparing the total nominated vote count with a nomination threshold;

converting the security into a candidate security if the total nominated vote count exceeds the nomination threshold;

receiving candidate votes from the participants for executing the market order for the candidate security;

totaling the candidate votes to produce a total candidate vote count;

comparing the total candidate vote count with a market order threshold; and

executing the market order if the total candidate vote count is greater than the market order threshold;

wherein executing the market order involves altering the composition of the financial investment fund with respect to the candidate security.

17. The method of

claim 16

, wherein executing the market order comprises purchasing the candidate security.

18. The method of

claim 16

, wherein executing the market order comprises selling the security.

19. The method of

claim 16

, wherein the market order threshold comprises a market order percent, the method further comprising receiving the market order percent from the participants.

20. The method of

claim 19

, wherein receiving the market order percent comprises setting the market order percent based on input received from the participants.

21. The method of

claim 19

, wherein receiving the market order percent comprises:

receiving market order votes from the participants; and

averaging the market order votes to arrive at the market order percent.

22. The method of

claim 19

, wherein receiving market order votes and averaging the market order votes occurs on a regular basis.

23. The method of

claim 19

, further including requiring each participant to vote for the market order percent before receiving the nomination votes or candidates votes from each participant.

24. The method of

claim 16

, further comprising weighting at least one of the nomination votes or candidate votes based on participant.

25. The method of

claim 24

, wherein weighting comprises weighting based on each participant'"'"'s ownership interest in the financial investment fund.

26. The method of

claim 16

, further including determining whether a nominated security should replace a candidate security on the candidate list by comparing the total nominated vote count of the nominated security with a second total nominated vote count received by each security on the candidate list, and replacing the candidate security with the nominated security if the total nominated vote count of the security on the nominated list exceeds the nominated vote count previously received by that candidate security.

27. The method of

claim 16

, wherein executing the market order includes:

determining whether the security meets criteria on managing the fund;

determining whether sufficient cash exists to execute the market order; and

if multiple market orders are received for multiple securities, determining an order to execute the market orders based on the candidate votes.

28. The method of

claim 16

, wherein receiving nominations includes requesting that the participant provide information relevant to the nominated security.