Securities trading system for consolidation of trading on multiple ECNS and electronic exchanges

• US 6,278,982 B1
• Filed: 04/21/1999
• Issued: 08/21/2001
• Est. Priority Date: 04/21/1999
• Status: Expired due to Term

• Current Assignee: LavaFlow LLP
• Original Assignee: Lava Trading Inc. (The Woodbridge Co. Ltd.)
• Inventors: Rafieyan, Kamran L., Korhammer, Richard A., Chutjian, Keith P.
• Primary Examiner(s): Hafiz, Tariq R.
• Assistant Examiner(s): Jeanty, Romain
• Application Number:
  US09/296,096
• Time in Patent Office: 853 Days
• Field of Search: 705/35, 705/36, 705/37
• US Class Current: 705/36.00R
• 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 securities trading consolidation system where each customer uses a single trader terminal to view, and analyze security market information from and to conduct security transactions with two or more ECNs, or other comparable ATSs, alone or in combination with one or more electronic exchanges. A consolidating computer system supplies the market information and processes the transactions. The consolidating computer system aggregates order book information from each participating ECN order book computer including security, order identification, and bid/ask prices information. Bid and ask prices for participating electronic exchanges may be integrated into the display. The combined information is displayed to a customer by security and by bids and offers, and then sorted by price, volume and other available attributes as desired by the customer. The consolidating computer system forwards to each trading terminal information from only those market maker ECNs and electronic exchanges that the customer is an ECN member or electronic exchange user and thus entitled to receive.

Claims

1. A financial data processing system for securities or commodities for traders which integrates order book information from two or more alternative trading systems comprising:

at least two alternative trading systems having different order book information protocols;

data communication means to receive information from each participating alternative trading system to allow receipt of their order book information in their native order book information protocols;

converter means to convert order book information of each alternative trading system into a common system order book information protocol;

integration means for combining the order book information from each alternative trading system data communications means into a single order book;

means for distributing the resulting combined order book to traders in the common order book information protocol; and

display means for displaying said order book to traders.

2. The financial data processing system of claim 1 wherein there are means to limit the order book information supplied to any individual trader to order book information from only those alternative trading systems of which the trader is a member.

3. The financial data processing system in accordance with claim 1 wherein at least one electronic exchange, having its native order information protocol, participates in said financial data processing system of the present invention and wherein the participating electronic exchanges'"'"' order book information is integrated with the order book information of the alternative trading systems including:

data communications means to receive information from each participating electronic exchange to allow receipt of its order book information in the electronic exchanges'"'"' native order book information protocol;

converter means for converting the order information from said participating electronic exchange into the common system order book information protocol; and

integration means to integrate the order book information from the alternative trading system with the order book information from one or more electronic exchanges to make a combined order book.

4. The financial data processing system of claim 3 having means for converting back and forth between the individual alternative trading systems'"'"' and electronic exchanges'"'"' order placement protocol and a common system order placement protocol thereby allowing traders to place orders, hit bids, take offers and receive confirmation of executions, in any of the individual alternative trading systems or the electronic exchanges.

5. The financial data processing system of claim 4 wherein the converting means which converts between the individual alternative trading systems and exchanges and the common system order placement protocol allows traders to place orders, hit bids, take offers and receive confirmation of execution, takes advantage of all the special order entry features of each participating alternate trading system and electronic exchange.

6. The financial data processing system of claim 3 where there are means for filtering out order book information by parameters selected by the trader.

7. The financial data processing system of claim 1 having means for converting back and forth between the individual alternative trading systems'"'"' order placement protocol and a common system order placement protocol thereby allowing traders to place orders, hit bids, take offers and receive confirmation of executions.

8. The financial data processing system of claim 1 wherein there is sorting means which organizes the order book information by security, by bid or sale and then by price, volume or other variables as selected by the trader.

9. A data processing method for providing trading information to traders in a security or commodity from two or more alternative trading systems, comprising the steps of:

receiving order book information from each participating alternative trading system in order book information protocols native to the particular alternative trading system;

converting the information to a common system order book protocol;

integrating the order book information from each alternative trading system into a single order book;

distributing the combined order book to the traders in the common system order book protocol; and

displaying said combined order book to the traders.

10. The method of claim 9 wherein order book information to any trader is limited to only those alternative trading systems which the trader is a member.

11. The method of claim 9 wherein the order book of the alternative trading systems is integrated with information from one or more electronic exchanges.

12. The method of claim 11 wherein the information received from an alternative trading system and the electronic exchanges are analyzed and the analysis information is used to aid traders in placing of bids and offers.

13. The method of claim 12 wherein the analysis information is supplied to the trader to aid in placing orders.

14. The method of claim 13 wherein the analysis information automatically controls the placing of orders.

15. The method of claim 13 wherein the trader places orders, hits bids, takes offers and receives confirmation of execution in a common order placement protocol.

16. The method of claim 15, wherein all the special order entry features of each participating alternative trading system is maintained in the common system order placement protocol.

17. The method of claim 11 where the order book information is filtered by parameters selected by the trader.

18. The method of claim 11 where the information is integrated by securities, bids and offers and then sorted by price.

19. The method of claim 9 wherein order book information is also supplied from one or more electronic exchanges in their native order information protocol which is converted to the common book protocol and integrated into the combined order book information.