SYSTEM AND METHODS FOR ELECTRONIC TRADING THAT PERMIT PRINCIPAL/BROKER TRADING

• US 20150066736A1
• Filed: 11/10/2014
• Published: 03/05/2015
• Est. Priority Date: 06/01/2001
• Status: Active Grant

• Current Assignee: BGC Partners Incorporated (BGC Group, Inc.)
• Original Assignee: BGC Partners Incorporated (BGC Group, Inc.)
• Inventors: Gilbert, Andrew C., Stergiopoulos, Andrew, Tselepis, William P.
• Granted Patent: US 10,438,286 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

Abstract

Electronic trading systems and methods which facilitate principal/broker trading are provided. In a first aspect of the invention, a database relating to trading participants in the trading system is designed to indicate which traders utilize a principal/broker relationship and what, if any, limitations are placed on the activity of the broker, trading commands submitted by the broker, and counterparties in a transaction with the broker. In another aspect of the invention, trading commands and executed trades involving principals/brokers may be presented to other traders using special designations. The ability to enter certain trading commands by, and in response to, brokers may be limited. In a further aspect of the invention, anonymous trading features may prevent traders from knowing whether another trader is a broker or principal, may restrict traders from being able to block trading with brokers, and may permit brokers to configure anonymous trading parameters.

Claims

1-8. -8. (canceled)

9. A method comprising:

receiving, by at least one computer processor, at least one configuration setting from a first party, the at least one configuration setting comprising an indication of whether or not the first party is willing to trade with a second party;

receiving, by the at least one computer processor, from the second party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining, by the at least one computer processor, whether or not the first party is willing to trade with the second party based at least in part on the at least one configuration setting received from the first party, wherein determining whether or not the first party is willing to trade with the second party comprises determining that the first party is not willing to trade with the second party; and

withholding, by the at least one computer processor, presentation of the order to the first party in response to the determination that the first party is not willing to trade with the second party.

12. The method of claim 9, wherein the at least one configuration setting further comprises an indication of whether or not the first party is willing to trade with a third party, the method further comprising:

receiving, by the at least one computer processor, from the third party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining, by the at least one computer processor, whether or not the first party is willing to trade with the third party based at least in part on the at least one configuration setting, wherein determining whether or not the first party is willing to trade with the third party comprises determining that the first party is willing to trade with the third party; and

presenting, by the at least one computer processor, the order received from the third party to the first party in response to the determination that the first party is willing to trade with the third party.

13. The method of claim 12, wherein the at least one configuration setting further comprises a warning limit, the warning limit comprising at least one of a buy side limit and a sell side limit, the method further comprising:

determining, by the at least one computer processor, whether or not the warning limit is exceeded by the order received from the third party.

14. The method of claim 13, wherein the at least one configuration setting further comprises a trade execution setting, the trade execution setting specifying an action to be taken after a determination that the warning limit is exceeded, the trade execution setting comprising a setting selected from the group consisting of automatic rejection of the whole trade, automatic acceptance of the full trade, automatic acceptance of only part of the trade, manual acceptance of the full trade, and manual acceptance of only part of the trade.

15. The method of claim 14, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the method further comprising:

determining, by the at least one computer processor, that the trade execution setting is automatic acceptance of the full trade; and

executing, by the at least one computer processor, a trade between the first party and the third party for the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of the full trade.

16. The method of claim 14, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the method further comprising:

determining, by the at least one computer processor, that the trade execution setting is automatic acceptance of only part of the trade; and

executing, by the at least one computer processor, a trade between the first party and the third party for only part of the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of only part of the trade.

17. The method of claim 14, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the method further comprising:

determining, by the at least one computer processor, that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

requesting, by the at least one computer processor, from the first party acceptance of a full trade or partial trade based at least in part on the determination that the setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

receiving, by the at least one computer processor, acceptance of the full trade or partial trade; and

executing, by the at least one computer processor, a trade between the first party and the third party for the full order or only part of the order received from the third party based at least in part on the determination that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade and the received acceptance of the full trade or partial trade from the first party.

10. An apparatus comprising:

at least one processor; and

memory including instructions that, when executed by the at least one processor, configure the at least one processor for;

receiving at least one configuration setting from a first party, the at least one configuration setting comprising an indication of whether or not the first party is willing to trade with a second party;

receiving from the second party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining whether or not the first party is willing to trade with the second party based at least in part on the at least one configuration setting, wherein determining whether or not the first party is willing to trade with the second party comprises determining that the first party is not willing to trade with the second party; and

withholding presentation of the order to the first party in response to the determination that the first party is not willing to trade with the second party.

18. The apparatus of claim 10, wherein the at least one configuration setting further comprises an indication of whether or not the first party is willing to trade with a third party, the instructions further configuring the at least one processor for:

receiving from the third party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining whether or not the first party is willing to trade with the third party based at least in part on the at least one configuration setting, wherein determining whether or not the first party is willing to trade with the third party comprises determining that the first party is willing to trade with the third party; and

presenting the order received from the third party to the first party in response to the determination that the first party is willing to trade with the third party.

19. The apparatus of claim 18, wherein the at least one configuration setting further comprises a warning limit, the warning limit comprising at least one of a buy side limit and a sell side limit, the instructions further configuring the at least one processor for:

determining whether or not the warning limit is exceeded by the order received from the third party.

20. The apparatus of claim 19, wherein the at least one configuration setting further comprises a trade execution setting, the trade execution setting specifying an action to be taken after a determination that the warning limit is exceeded, the trade execution setting comprising a setting selected from the group consisting of automatic rejection of the whole trade, automatic acceptance of the full trade, automatic acceptance of only part of the trade, manual acceptance of the full trade, and manual acceptance of only part of the trade.

21. The apparatus of claim 20, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is automatic acceptance of the full trade; and

executing a trade between the first party and the third party for the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of the full trade.

22. The apparatus of claim 20, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is automatic acceptance of only part of the trade; and

executing a trade between the first party and the third party for only part of the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of only part of the trade.

23. The apparatus of claim 20, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

requesting from the first party acceptance of a full trade or partial trade based at least in part on the determination that the setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

receiving acceptance of the full trade or partial trade; and

executing a trade between the first party and the third party for the full order or only part of the order received from the third party based at least in part on the determination that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade and the received acceptance of the full trade or partial trade from the first party.

11. A non-transitory computer readable medium including instructions that, when executed by at least one processor, configure the at least one processor for:

receiving at least one configuration setting from a first party, the at least one configuration setting comprising an indication of whether or not the first party is willing to trade with a second party;

receiving from the second party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining whether or not the first party is willing to trade with the second party based at least in part on the at least one configuration setting, wherein determining whether or not the first party is willing to trade with the second party comprises determining that the first party is not willing to trade with the second party; and

withholding presentation of the order to the first party in response to the determination that the first party is not willing to trade with the second party.

24. The non-transitory computer readable medium of claim 11, wherein the at least one configuration setting further comprises an indication of whether or not the first party is willing to trade with a third party, the instructions further configuring the at least one processor for:

receiving from the third party an order comprising a bid to buy a financial instrument or an offer to sell a financial instrument;

determining whether or not the first party is willing to trade with the third party based at least in part on the at least one configuration setting, wherein determining whether or not the first party is willing to trade with the third party comprises determining that the first party is willing to trade with the third party; and

presenting the order received from the third party to the first party in response to the determination that the first party is willing to trade with the third party.

25. The non-transitory computer readable medium of claim 24, wherein the at least one configuration setting further comprises a warning limit, the warning limit comprising at least one of a buy side limit and a sell side limit, the instructions further configuring the at least one processor for:

determining whether or not the warning limit is exceeded by the order received from the third party.

26. The non-transitory computer readable medium of claim 25, wherein the at least one configuration setting further comprises a trade execution setting, the trade execution setting specifying an action to be taken after a determination that the warning limit is exceeded, the trade execution setting comprising a setting selected from the group consisting of automatic rejection of the whole trade, automatic acceptance of the full trade, automatic acceptance of only part of the trade, manual acceptance of the full trade, and manual acceptance of only part of the trade.

27. The non-transitory computer readable medium of claim 26, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is automatic acceptance of the full trade; and

executing a trade between the first party and the third party for the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of the full trade.

28. The non-transitory computer readable medium of claim 26, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is automatic acceptance of only part of the trade; and

executing a trade between the first party and the third party for only part of the order received from the third party based at least in part on the determination that the trade execution setting is automatic acceptance of only part of the trade.

29. The non-transitory computer readable medium of claim 26, wherein determining whether or not the warning limit is exceeded comprises determining that the warning limit is exceeded, the instructions further configuring the at least one processor for:

determining that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

requesting from the first party manual acceptance of the full trade or part of the trade based at least in part on the determination that the setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade;

receiving manual acceptance of the full trade or only part of the trade; and

executing a trade between the first party and the third party for the full order or only part of the order received from the third party based at least in part on the determination that the trade execution setting is one of manual acceptance of the full trade or manual acceptance of only part of the trade and the received acceptance of the full trade or only part of the trade from the first party.