ELECTRONIC TRADING CONFIRMATION SYSTEM

• US 20080262959A1
• Filed: 10/31/2007
• Published: 10/23/2008
• Est. Priority Date: 11/13/2001
• Status: Active Grant

• Current Assignee: Intercontinental Exchange Holdings, Inc. (Intercontinental Exchange, Inc.)
• Original Assignee: Intercontinental Exchange Holdings, Inc. (Intercontinental Exchange, Inc.)
• Inventors: Worley, Cynthia L., Rane, Sanjay, Hughes, Tracy, Tupper, Bruce, Xia, DongChun, Marcial, Edwin, Vice, Charles, Tullis, Henry D.
• Granted Patent: US 9,935,460 B2
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: H02J 3/008 involving trading of energy or energy transmission rights
• CPC Class Codes: Y04S 10/50 Systems or methods supporting the power network operation or management, involving a certain degree of interaction with the load-side end user applications
• CPC Class Codes: Y04S 50/10 Energy trading, including energy flowing from end-user application to grid

Abstract

A system and method of confirming trades of financial instruments such as OTC derivatives is disclosed. The system includes a data interface which accepts data relating to a trade from both the trader and counter party. The data includes different data fields of differing importance. The system includes a matching engine which compares the submitted data and assigns the trade a status depending on which of the data fields match. The system allows a user to filter trades on their status and display the details relating to that trade. The system also allows a user to display the data fields and change the data fields in order to change the status of the trades. The system thus allows a user to electronically confirm a trade and also identify unmatched trades and the information necessary to reconcile such unmatched trades.

Claims

1. An electronic trade confirmation system comprising:

a processing system configured to receive trade data from two or more trading participants desiring to engage in a trading transaction, said processing system comprising a matching engine that when run enables the processing system to;

compare trade data received from the two or more trading participants to determine a consistency between the trade data;

classify the trading transaction based on the comparison such that each trading participant may store, retrieve, search, edit, and track the trading transaction according to the classification; and

generate an electronic trade confirmation if the trading transaction is classified as matched.

2. The electronic trade confirmation system of claim 1, wherein the matching engine comprises:

a matching program that when run enables the matching engine to compare trade data, classify trading transactions, and confirm trading transactions; and

a central processor for running the matching program.

3. The electronic trade confirmation system of claim 2, further comprising:

a data input port in communication with the processing system, for receiving trade data from the two or more trading participants;

a data processing module in communication with the matching engine for processing the received trade data and providing the processed trade data to the matching engine; and

a data interface module in communication with both the data input port and the data processing module, said data interface module providing the trade data received via the data input port to the data processing module.

4. The electronic trade confirmation system of claim 3, further comprising a data base module coupled to the data interface module and to the matching engine for storing trade data, trade-confirmation data, and trade life cycle data, said database module being accessible by either of the trading participants for storing, retrieving, searching, editing, saving, and tracking the trading transaction according to the transaction classification.

5. The electronic trade confirmation system of claim 4, wherein the data interface module is further configured to report matched trades, trade-confirmation data, and life cycle data, the life cycle data including information relating to each stage of a trade'"'"'s life cycle.

6. The electronic trade confirmation system of claim 5, further comprising one or more trading terminals in communication with the processing system for transmitting trade data provided by the one or more trading participants to the processing system.

7. The electronic trade confirmation system of claim 2, wherein the matching program further enables the matching engine to classify trading transactions as at least one of a matched, alleged, unmatched, pending and canceled trade.

8. The electronic trade confirmation system of claim 7, wherein the matching program, when run, enables a system administrator to manage and authorize users to access trade data and view summaries of executed trades, said summaries comprising trade life cycle data.

9. The electronic trade confirmation system of claim 8, wherein the matching program, when run, enables the matching engine to identify inconsistencies between the trade data provided by the two or more trading participants, and to reconcile the inconsistencies according to additional trade data provided by at least one of the two or more trading participants.

10. The electronic trade confirmation system of claim 9, further comprising a back office systems terminal coupled to at least one trading terminal and to the processing system, the back office systems terminal being operable for tracking trading transactions.

11. The electronic trade confirmation system of claim 3, wherein the data interface module comprises:

an XML API interface for receiving XML-type trade data;

a tab delimited file interface for receiving trade data in a tab delimited format; and

a SOAP data interface protocol for inputting trade data to the processing system.

12. The electronic trade confirmation system of claim 11, wherein the data interface module further comprises an XML module for providing an XML response mechanism for requests received via the XML API interface.

13. The electronic trade confirmation system of claim 12, wherein the data interface module further comprises an e-mail notification interface for providing responses to requests based on predefined specific events occurring within the processing system.

14. The electronic trade confirmation system of claim 13, wherein the data processing module comprises a web server cluster, a weblogic application server cluster, a trade mapping engine, and an e-mail server.

15. The electronic trade confirmation system of claim 14, wherein the matching engine employs a rules-based architecture for matching predefined data fields in data files provided by two or more trading participants, said rules-based architecture comprising tables for segregating trade data and XML tags for defining trade product characteristics, the trade product characteristics being used as matching criteria.

16. The electronic trade confirmation system of claim 1, wherein the trading participants comprise at least one of a trader, a trading firm, a broker, a brokerage firm, a company, a company subsidiary, and an energy company.

17. The electronic trade confirmation system of claim 16, wherein the trading participants comprise a combination of brokers and brokerage firms.

18. The electronic trade confirmation system of claim 17, wherein the matching engine is configured to provide a broker matching service for confirming, consummating, and reporting electronic over-the-counter trading transactions to broker-type trading participants.

19. A method of electronic trade confirmation, consummation, and reporting, the method comprising:

comparing trade data of two or more trading participants desiring to engage in a trading transaction;

classifying the trading transaction based on the comparison such that each trading participant may store, retrieve, search, edit, and track the trading transaction according to said classifying;

generating an electronic trade confirmation if the trading transaction is classified as a matched trade;

consummating the trading transaction; and

automatically reporting trade confirmation data, trade consummation data, and trade life cycle data associated with the trading transaction.

20. An electronic trading system comprising:

a data input port for receiving trade data from the two or more trading participants;

a matching engine for comparing the received trade data and for classifying trades;

a data processing module in communication with the matching engine for processing the received trade data and providing the processed trade data to the matching engine for comparison and classification;

a database for storing trade data, matched trades, and trade life cycle data; and

a data interface module in communication with the data input port, the data processing module, and the database,

said data interface module providing trade data received via the data input port to the data processing module and reporting trade confirmation data, matched trade data, and trade life cycle data to one or more system participants.