System and method for physicals commodity trading

• US 20020120555A1
• Filed: 07/18/2001
• Published: 08/29/2002
• Est. Priority Date: 07/18/2000
• Status: Active Grant

• Current Assignee: Julie A. Lerner
• Original Assignee: Julie A. Lerner
• Inventors: Lerner, Julie A.
• Granted Patent: US 8,180,698 B2
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 30/0283 Price estimation or determination
• CPC Class Codes: G06Q 30/0613 Third-party assisted
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• 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 method and system for an electronic commodities trading marketplace along with ancillary tools provide an electronic trading center for world market commodity importers, exporters, and the intermediaries and processors between them. This trading center is offered through its website centered around a 24-hour exchange that provides trading markets for commodities such as coffee, sugar, cocoa and cotton. The scalable system provides aggregated third party services linked to both front and back office operations. These services can include items such as live futures quotes and real-time news, futures brokerage, banking and finance links and resources, and a suite of applications tailored to members'"'"' specific risk-management and end-to-end contract execution needs. The system also provides access to shipping related services such as freight brokerage, direct booking for liner transport, load and discharge supervision and laboratory testing.

Claims

1. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair without requiring manual intervention by a trader;

receiving information relating to at least one of news, securities prices, weather impacting the commodity trading;

providing a portion of the received information to one or more of the traders.

establishing communications links with one or more banks involved in commodity transactions and one or more financial institutions;

permitting the traders to have access to one or both of banking services and financing services over the communications links; and

providing the traders with access to external or internal service providers related to completing the execution of the matching pair.

2. The method according to claim 1, wherein the trading engine is further configured to notify one or more or the traders associated with the matching orders regarding a potential trade involving the matching orders.

3. The method according to claim 1, further comprising the step of:

forwarding data relating to executed orders to electronic futures brokerages to permit clearing of the executed orders.

4. The method according to claim 1, wherein the banking services include at least one of:

issuing letters of credit, confirming letters of credit, payment against documents, wire transfers, monthly invoices, and futures booker invoices.

5. The method according to claim 1, wherein the financial institutions include at least one of:

trade houses, banks, and capital markets hedge funds/investors.

6. The method according to claim 1, wherein the financial services include at least one of:

structure flexible payment and pre-finance alternatives.

7. The method according to claim 1, wherein the service providers include at least one of:

freight providers, laboratory testing, and vessel agents.

8. The method according to claim 1, wherein the services providers provide one or more of the following services:

quotes for shipping routes, freight brokerage, third party liner freight services, and vessel agency.

9. A method for establishing an electronic commodity marketplace, comprising the steps of:

permitting access to the online marketplace to a plurality of types of commodity trading participants;

receiving selections of trading partners from a particular participant relating to other participants with which the particular participant will deal with in the marketplace;

receiving a plurality of trade orders or counter proposals, each from any of the participants; and

providing information regarding each trade order or counter proposal to all participants.

10. The method according to claim 9, wherein the plurality of types comprises more than one of producers, exporting associations, processors/refiners, trade houses, importers, and buying agencies.

11. The method according to claim 9, further comprising the step of:

identifying to a first participant detailed information about a first trade order or counter proposal from a second participant only if the second participant and the first participant have identified each other as trading partners.

12. The method according to claim 9, further comprising the steps of:

storing a set of automatic trading rules, each set associated with a participant;

identifying a first trade order or counter proposal matching a predetermined set of criteria; and

responding to a first trade order or counter proposal with a second counter proposal in accordance with the set of automatic trading rules.

13. The method according to claim 9, further comprising the steps of:

storing a set of order templates, each set associated with a participant and each template comprising one or more modifiable default parameters;

identifying one of the set of order templates to initiate a first trade order or counter proposal;

populating the one order template with the one or more modifiable default parameters;

receiving input from the participant revising and accepting the populated one order template; and

submitting the first trade order or counter proposal based on the revised template.

14. The method according to claim 13, wherein the modifiable default parameters include commodity quality, commodity shipment times, commodity delivery points, commodity amounts, if-then statements relating to automatic trades involving acceptance of modified terms, and converting contract terms to different pricing mechanism.

15. The method according to claim 9, further comprising the step of:

providing electronic confirmations of executed orders to each participant of the executed order.

16. The method according to claim 9, further comprising the step of:

pushing to each participant an update of that participant'"'"'s market position.

17. The method according to claim 9, further comprising the step of:

forwarding notification of an executed trade to an accounting service.

18. The method according to claim 9, further comprising the step of:

forwarding notification of an executed trade to a freight forwarding service.

19. The method according to claim 9, further comprising the steps of:

associating with each participant a membership level; and

filtering information forwarded to a particular participant based on the membership level associated with that particular participant.

20. The method according to claim 19, wherein the information filtered includes one or more of trading screens, industry-related reports, polls, forums, chats, bulletin boards, and real-time news.

21. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair without requiring manual intervention by a trader;

receiving data relating to a trader, said information relating to a futures position of the trader;

receiving financial data relating to the trader, said information relating to a bank account and dept obligation of the trader;

calculating a physicals position of the trader; and

providing the trader with an accounting statement based on the futures position, the financial data and the physicals position.

22. The method according to claim 21, wherein the step of providing the trader with the accounting statement is performed in real-time.

23. The method according to claim 21, further comprising the steps of:

sorting the accounting statement according to geographic location.

26. The method according to claim 25, further include the step of:

modifying the selected one form based on the matching pair before forwarding.

27. The method according to claim 25, further comprising the step of:

adding an additional form as industry standard provisions and terms evolve.

28. The method according to claim 25, wherein the one form is one of a contract, bill of lading, letter of credit, and structured financial product.

30. The method according to claim 29, wherein the step of assessing further includes the step of:

assessing a position value based on intra-day future'"'"'s values.

31. The method according to claim 29, wherein the step of assessing further includes the step of:

determining a running total of a daily risk position.

32. The method according to claim 29, further comprising the step of:

allowing a trader to request one or more of the following views;

a position in a commodity;

pricing and hedging activity to date related to the commodity;

summary of estimated profitability related to the commodity;

a hypothetical effect to the position if a specific terms of a trade were changed.

25. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

storing a plurality of forms, each of said forms containing industry standard provisions and terms;

receiving a request from a particular trader associated with the executed matching pair to select one of the forms; and

forwarding to the particular trader the selected one form.

29. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

assessing a trader'"'"'s risk position in real-time; and

forwarding the assessed risk position to the trader.

33. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

receiving information related to commodities via one or more data feeds and internally collected data;

parsing the information to identify a time, date and identifier associated with one or more activities of interest to at least some of the traders; and

populating a calendar with entries of the identified time, data and identifier.

34. The method according to claim 33, further comprising the step of:

associating with each calendar entry additional information which can be drilled-down by a trader; and

forwarding the populated calendar to the trader.

36. The method according to claim 35, further comprising the step of:

forwarding a notification to the trader associated with the automatically executed rule set.

38. The method according to claim 37, wherein the opportunities include at least one of options, spread, deferred arbitrage, and hedge rolling from a nearby position.

35. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

storing a plurality of rule sets, each rule set associated with a trader; and

automatically executing the rule set in response to any order submitted to the trading engine.

37. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

receiving information related to a trader'"'"'s position, market history, and upcoming events affecting commodities; and

evaluating profit making opportunities based on the received information.

39. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

calculating profits and losses versus budgeted at the time of an executed trade,

wherein the profits and losses are broken down by each component of the trade.

40. A method for providing commodity trading over the Internet comprising the steps of:

providing a trading engine configured to;

receive a plurality of orders, each order associated with one of a plurality of traders,

identify a pair of matching orders from among the plurality of orders, and

automatically execute the matching pair of orders without requiring manual intervention by a trader;

receiving from a trader information related to an exporter'"'"'s effect on a commodity;

calculate a most profitable schedule of sales and exports based on the information, future'"'"'s values, and a system'"'"'s rate board.