Exchange traded currency fund instrument and system

• US 20050171894A1
• Filed: 08/26/2004
• Published: 08/04/2005
• Est. Priority Date: 08/26/2003
• Status: Abandoned Application

• Current Assignee: Waves Licensing, LLC
• Original Assignee: Waves Licensing, LLC
• Inventors: Traynor, Michael
• Application Number:
  US10/926,614
• Publication Number:
  US 20050171894A1
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 20/108 Remote banking, e.g. home banking
• CPC Class Codes: G06Q 20/1085 involving automatic teller machines [ATMs]
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

The herein described system and methods encompass a tradable (e.g., exchange-listed) instrument that represents an interest in a fund asset (e.g., an underlying currency). In an illustrative implementation, the interest in the fund asset can be purchased (or sold) against units of another currency and can function as a tradable instrument (e.g., the tradable instrument can reflect the relative value of pairs (or groups) of currencies). In an illustrative practice of the herein described systems and methods, a trust can be formed whose underlying investment can consist of demand deposits denominated in a selected currency (e.g., euros ()). The trust can operate to receive an investment amount in a first currency (e.g., euros) and provide shares (or trust receipts) having a value in a second currency (e.g., U.S. dollars). The shares (or receipts) of the trust can be listed, quoted, and traded on a trading system.

Claims

1. A tradable instrument representing ownership of an interest in a fund asset,

wherein the fund asset has a value represented in at least one first currency, and

wherein the fund asset has a value denominated in a second currency different from the first currency, and

wherein the fund asset has a value representative of the relative values of the at least one first currency and the second currency.

2. The tradable instrument as recited in claim 1, wherein the first currency is a non-U.S. currency and the second currency is U.S. dollars.

3. The tradable instrument as recited in claim 1, wherein the at least one first currency comprises a plurality of different currencies.

4. The tradable instrument as recited in claim 1, wherein the at least one first currency comprises any of a currency index and a basket of currencies.

5. A tradable instrument representing ownership of an interest in a fund asset,

wherein the fund asset represents at least one non-U.S. currency, and

wherein the fund asset has a value denominated in U.S. dollars, and

wherein the fund asset has a value representative of the relative values of such non-U.S. currency and the U.S. dollar.

6. An instrument issued by a statutory trust comprising a trust share that represents an undivided beneficial interest in a portfolio of at least one first currency with a market value denominated in a second currency different from the at least one first currency that fluctuates in response to changes in value of the underlying at least one first currency.

7. The instrument as recited in claim 6 wherein the trust share is capable of being traded on a trading system and able to be purchased and redeemed through the trust.

8. The instrument as recited in claim 6, wherein the first currency is a non-U.S. currency and the second currency is U.S. dollars.

9. An instrument issued by a statutory trust comprising a trust receipt that represents an undivided beneficial interest in a portfolio of at least one first currency with a market value denominated in a second currency different from the at least one first currency that fluctuates in response to changes in value of the underlying at least one first currency.

10. The instrument as recited in claim 9 wherein the share is capable of being traded on a trading system and able to be purchased and redeemed through the trust.

11. The instrument of claim 9, wherein the first currency is a non-U.S. currency and the second currency is U.S. dollars.

12. An instrument issued by a statutory trust comprising a trust share that represents an undivided beneficial interest in a portfolio of at least one non-U.S. currency with a market value denominated in U.S. currency that will fluctuate in response to changes in value of the underlying non-U.S. currency, the instrument being tradable on a trading system.

13. The instrument as recited in claim 12 wherein the trust share is capable of being purchased and redeemed through the trust.

15. The instrument as recited in claim 12 wherein the trust receipt is capable of being purchased and redeemed through the trust.

14. An instrument issued by a statutory trust comprising a trust receipt that represents an undivided beneficial interest in a portfolio of at least one non-U.S. currency with a market value denominated in U.S. currency that will fluctuate in response to changes in value of the underlying non-U.S. currency, the instrument being tradable on a trading system.

16. A trading system, comprising:

a fund held by a custodian and consisting of at least one first currency; and

a tradable instrument representing ownership of an interest in the fund and having a value denominated in a second currency different from the at least one first currency and representative of the relative values of said at least one first currency and the second currency, the instrument being issued to an investor in exchange for an investment amount.

17. The trading system as recited in claim 16 wherein the at least one first currency is invested in interest bearing accounts providing for a market rate of return.

18. The trading system as recited in claim 16, wherein the at least one first currency is a non-U.S. currency and the second currency is U.S. dollars.

19. The trading system as recited in claim 18, wherein the first currency is a plurality of different currencies.

20. A trading system, comprising

a fund held by a custodian and consisting of at least one non-U.S. currency and invested at market rates of return, and

a tradable instrument representing ownership of an interest in the fund and having a value denominated in U.S. dollars and representative of the relative values of at least one non-U.S. currency and the U.S. dollar, the instrument being issued to an investor in exchange for an investment amount.

21. The trading system as recited in claim 20, wherein the investment amount is the second currency.

22. A trading system, comprising:

a statutory trust, the assets of which consist of at least one first currency bearing interest at market rates of return and held by a custodian for the benefit of investors; and

an instrument issued by the trust representing an undivided beneficial interest in the trust assets, the instrument having a value denominated in a second currency different from the first currency and being tradable on a stock exchange and similar trading systems.

23. The system as recited in claim 22 wherein the instrument is capable of being purchased and redeemed through the trust.

24. The trading system as recited in claim 23, wherein the at least one first currency is a non-U.S. currency and the second currency is U.S. dollars.

25. The trading system as recited in claim 23, wherein the at least one first currency is a plurality of different currencies.

26. A trading system, comprising:

a statutory trust, the assets of which consist of at least one non-U.S. currency bearing a return and held by a custodian for the benefit of investors; and

an instrument issued by the trust representing an undivided beneficial interest in the trust assets, the instrument having a value denominated in U.S. currency and being tradable on a stock exchange and similar trading systems.

27. The trading system as recited in claim 26 wherein the instrument is capable of being purchased and redeemed through the trust.

28. A method of investing, comprising

accepting from an investor an investment amount in at least one first currency;

establishing a fund with a custodian;

investing said at least one first currency in assets denominated in said at least one first currency that bears a return; and

issuing to said investor a tradable instrument representing ownership of an interest in the fund and having a value denominated in a second currency different from the first currency and representative of the relative values of said at least one first currency or currencies and the second currency.

29. The method as recited in claim 28, wherein the assets comprise any of demand deposits and money market accounts.

30. The method as recited in claim 28, wherein the first currency is U.S. dollars and the second currency is at least one non-U.S. currency.

31. The method as recited in claim 30, wherein the at least one non-U.S. currency comprises a plurality of different currencies.

32. The method as recited in claim 30, wherein the at least one non-U.S. currency comprises a currency index.

33. The method as recited in claim 28, further comprising facilitating the ability to buy and/or sell options on the tradable instrument through an options trading system.

34. A method of investing, comprising

accepting from an investor an investment amount in at least one first currency,

establishing a monetary fund;

and

issuing to said investor a tradable instrument representing ownership of an interest in the fund and having a value denominated in a second currency different from the at least one first currency and representative of the relative values of said at least one first currency and the second currency.

35. The method as recited claim 34, further comprising facilitating the ability to buy and/or sell options on the tradable instrument through an options trading system.

36. The method as recited in claim 34 further comprising investing said at least one first currency to generate a return.

37. A method of investing comprising:

establishing a financial construct comprising any of a monetary fund and a trust the assets of which are held by a custodian for the benefit of investors;

entering into an agreement with the custodian that directs the custodian to invest the assets of the financial construct according to at least one designated parameter, comprising any of investing in an account comprising any of interest-bearing deposit and money market accounts with multiple banking institutions and to issue a representation of an ownership interest in the financial construct comprising any of a share and receipt to investors in exchange for the deposit by an investor of at least one currency with the trustee of the trust; and

redeeming representation of the ownership interest in the financial construct; and

delivering currency in exchange for the representation of the ownership interest in the financial construct redeemed, the representation of the ownership interest in the financial construct being tradable on a trading system.