SYSTEM AND METHOD FOR CLEARING TRANSACTIONS

• US 20130254089A1
• Filed: 03/15/2013
• Published: 09/26/2013
• Est. Priority Date: 03/26/2012
• Status: Active Grant

• Current Assignee: Tradeweb Markets LLC (Tradeweb Markets, Inc.)
• Original Assignee: Tradeweb Markets LLC (Tradeweb Markets, Inc.)
• Inventors: Kirby, Elisabeth, Hill, Kevin, Stocks, Ian
• Granted Patent: US 9,786,006 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: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A trading platform for trading financial instruments that provides the ability to manage customer credit limits, assess credit risks, and provide clearing certainty of trades. In an exemplary embodiment, the trading platform includes computer software modules and provides graphical user interfaces to handle the process of assessing credit risk, obtaining clearing certainty from a clearing member prior to trade execution, and providing notices of the existence or absence of clearing certainty with regard to particular trade requests.

Claims

1. A system for determining clearing certainty of trades between one or more customers and one or more dealers, the system in communication with one or more customer computer systems and one or more dealer computer systems having software operable thereon for permitting communication through the system, the system comprising:

a message system operable to transmit and receive messages from the customer and the one or more dealers;

a request system including one or more computer systems operative to;

accept trade order data from the one or more customers requesting a trade order;

receive clearing certainty data for the trade order from the one or more dealers; and

receive clearing certainty data from the one or more dealers;

a database system operative to store credit limit data associated with at least one of the one or more customers and the trade order;

a clearing certainty system operative to determine a clearing certainty status for the trade order and communicating the clearing certainty status to the one or more customers;

wherein the system is operative with programming to;

accept the trade order data;

determine whether the database system contains credit limit data, wherein

when the credit limit data is present in the database system, the system

determines the clearing certainty status based on the credit limit data in the database; and

communicates the clearing certainty status to the one or more customers.

2. The system of claim 1 further comprising:

a risk system operative to calculate credit risks relating to at least one of the one or more customers and the trade order.

3. The system of claim 1, wherein the system is further operative with programming such that when the credit limit data is not present in the database system, the system:

transmits a request for clearing certainty based on at least a portion of the trade order data to the one or more dealers;

receives clearing certainty data from the one or more dealers;

determines the clearing certainty status based on the clearing certainty data; and

communicates the clearing certainty status to the one or more customers.

4. The system of claim 1 further comprising:

a limit system operative to compare at least a portion of the trade order data with at least a portion of the credit limit data.

5. The system of claim 4 wherein the limit system compares at least a portion of the trade order data with at least a portion of the credit limit data at a time of a trade.

6. The system of claim 1 wherein the credit limit data may direct the system to transmit the request for clearing certainty to the one or more dealers.

7. The system of claim 1 further comprising:

an execution system in communication with one or more broker computer systems, wherein the execution system is operative to send at least a portion of the trade order data to one or more brokers for executing a trade.

8. The system of claim 7 further comprising a user interface that permits the one or more customers to elect to execute the trade.

9. The system of claim 8 wherein the message system is operative to transmit and receive messages from the one or more brokers.

10. The system of claim 9 wherein the message system transmits a message to the one or more brokers containing the clearing certainty status.

11. The system of claim 8 wherein the message system is operative to send the one or more dealers a message notifying the one or more dealers of a trade execution.

12. The system of claim 1 further including a deactivation system, the deactivation system including a dealer interface that permits the one or more dealers to terminate a credit of the one or more customers.

13. The system of claim 12 wherein the deactivation system is operative to terminate the credit of the one or more customers substantially on demand by the one or more dealers.

14. The system of claim 12 wherein the deactivation system is operative to disable at least a portion of a user interface provided to the one or more customers to prevent the one or more customers from clearing the trade order with at least one of the one or more dealers.

15. The system of claim 12 wherein the deactivation system is operative to disable at least a portion of a user interface provided to the one or more customers to prevent the one or more customers from clearing the trade order at a clearing house with at least one of the one or more dealers.

16. The system of claim 12 wherein the deactivation system is operative to disable at least a portion of a user interface provided to the one or more customers to prevent the one or more customers from clearing one or more predetermined categories of products with at least one of the one or more dealers.

17. The system of claim 12 wherein the deactivation system is operative to disable at least a portion of a user interface provided to the one or more customers to prevent the one or more customers from clearing one or more predetermined categories of currency with at least one of the one or more dealers.

18. A method for determining clearing certainty of trades between one or more customers and one or more dealers on a system in communication with one or more customer computer systems and one or more dealer computer systems, the method comprising:

transmitting and receiving messages from the one or more customers and the one or more dealers;

accepting trade order data from the one or more customers requesting a trade order;

obtaining clearing certainty data; and

determining a clearing certainty status for the trade order.

19. The method of claim 18 further comprising:

providing a deactivation system that includes a dealer interface that permits the one or more dealers to terminate a credit of the one or more customers.