Stock simulation engine for an options trading game

• US 6,709,330 B1
• Filed: 08/18/2000
• Issued: 03/23/2004
• Est. Priority Date: 08/20/1999
• Status: Expired due to Term

• Current Assignee: TD Ameritrade IP Company Incorporated (Charles Schwab Corporation)
• Original Assignee: Ameritrade Holding Corp. (Charles Schwab Corporation)
• Inventors: Klein, Cynthia Ann, Del Palacio, Jaime Rockwell, Kostolansky, Timothy J., Berlin, Lawrence Scott
• Primary Examiner(s): HOTALING, JOHN M
• Application Number:
  US09/640,788
• Time in Patent Office: 1,313 Days
• Field of Search: 463/1, 463/42, 463/9, 463/22, 273/278, 273/274, 434/107, 434/219, 700/90, 700/91, 705/35, 705/1, 705/36, 705/37, 703/6
• US Class Current: 463/9
• CPC Class Codes: A63F 13/65 automatically by game devices or servers from real world data, e.g. measurement in live racing competition
• CPC Class Codes: A63F 13/822 Strategy games; Role-playing games A63F13/825, A63F13/828 take precedence
• CPC Class Codes: A63F 2300/8094 Unusual game types, e.g. virtual cooking
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

An options simulation engine for an options trading game. The present invention comprises a game engine for keeping track of game time and game settings, an options market simulator for providing a real-world options trading environment, and a portfolio manager engine for keeping track of a player'"'"'s portfolio. The options market simulator comprises a basic stock price generator for moving stock prices, a news/rumor generator for moving stock prices, and an options pricing generator for pricing options. The portfolio manager comprises an available cash/minimum balance mechanism for determining how much a player is charged for buying and/or selling options and stocks, and for maintaining a player'"'"'s positions, a risk analysis mechanism for determining the amount of money a player can lose for any given stock or option, a margin requirements mechanism for keeping track of the minimum equity required in a player'"'"'s account to support the player'"'"'s total investment position, a profit and loss mechanism for determining a player'"'"'s profit and loss throughout the game and on a weekly basis, and a trading rules/limitations mechanism that prevents a player from breaking a trading rule or exceeding a limitation during game play.

Claims

1. An options simulation engine for an options trading game, comprising:

an options market simulator for providing a real-world options trading environment, said options market simulator comprising

a basic stock price generator for moving stock prices;

a news/rumor generator for moving stock prices; and

an options pricing generator for pricing options; and

a portfolio manager engine for keeping track of a player'"'"'s portfolio.

2. The options simulation engine of claim 1, further comprising:

a game engine for keeping track of game time and game settings.

3. The options simulation engine of claim 1, wherein said portfolio manager engine comprises:

an available cash/minimum balance mechanism for determining how much a player is charged for buying and/or selling options and stocks.

4. The options simulation engine of claim 1, wherein said portfolio manager engine comprises:

a risk analysis mechanism for determining the amount of money a player can lose on any given stock or option.

5. The options simulation engine of claim 1, wherein said portfolio manager engine comprises:

a margin requirements mechanism for keeping track of the minimum equity required in a player'"'"'s account to support a player'"'"'s total investment position.

6. The options simulation engine of claim 1, wherein said portfolio manager engine comprises:

a profit and loss mechanism for determining a player'"'"'s profit and loss throughout the options trading game and on a weekly basis.

7. The options simulation engine of claim 1, wherein said portfolio manager engine comprises:

a trading rules/limitations mechanism for preventing a player from breaking a trading rule and exceeding a limitation during game play.

8. The options simulation engine of claim 1, wherein said news/rumor generator generates news stories and rumors about one or more companies in a player'"'"'s portfolio to affect the stock price of said one or more companies.

9. The options simulation engine of claim 1, wherein said basic stock price generator generates semi-random movements of the price of each stock.

10. The options simulation engine of claim 1, wherein said options trading game is divided into four trading weeks separated by weekends to simulate a time-condensed version of a 30-day options cycle.

11. The options simulation engine of claim 10, wherein weekends provide a player the opportunity to relax and review a previous week'"'"'s activities, such as the news, stock quotes, and rumors, before resuming play of the trading options game.

12. The options simulation engine of claim 1, wherein news is displayed over a news ticker and a plurality of virtual traders interact with a player to provide rumors related to companies in a player'"'"'s pit.

13. The options simulation engine of claim 1, wherein one or more players trade in and out of options and equity positions as they see fit by analyzing news, rumors, and information about one or more companies until the trading options game ends.

14. The options simulation engine of claim 1, wherein the trading options game comprises:

a trading pit where all of the action takes place;

a data source of available options on companies in a player'"'"'s pit, wherein said data source provides quotes on options and equity prices;

a company information screen where a player can learn background and historical information about the companies in the player'"'"'s pit;

a stock graph for tracking prices of stocks in the player'"'"'s pit;

a news archive screen for enabling the player to view relevant news on companies in the player'"'"'s pit;

a portfolio screen for enabling the player to review the status of the player'"'"'s portfolio; and

a help/glossary screen for enabling the player to retrieve answers to game questions and review a glossary of options terms.

15. The options simulation engine of claim 1, wherein said options market simulator further comprises a floor broker, wherein said floor broker shows up occasionally with an options deal at a price below market value, wherein a player must determine whether the options deal is a good deal or a bad deal.

16. The options simulation engine of claim 1, wherein said options pricing generator comprises:

a call price;

a put price;

a delta, wherein said delta is a rate of change of price of an option for a change in stock price;

a bid-ask price, wherein said bid-ask price is the spread between a bid price and an ask price; and

infinite liquidity, wherein said infinite liquidity implies that there is an infinite market, whereby the number of contracts in a trade never exceeds the market by placing the trade at a present option price or a stock price,

wherein said options pricing generator computes the price of options using a Black-Scholes formula.

17. The options simulation engine of claim 1, further comprising a strike price generator for creating option series to enable the availability of option series at attractive prices for potential investors.

18. A computer program product comprising a computer useable medium including control logic stored therein, said control logic enabling an options simulation engine for an options trading game, said control logic comprising:

options market simulator means for enabling a processor to provide a real-world options trading environment, said options market simulator means comprising

basic stock price generating means for enabling a processor to move stock prices;

news/rumor generating means for enabling a processor to move stock prices; and

options pricing generating means for enabling a processor to price options; and

portfolio manager engine means for enabling a processor to keep track of a player'"'"'s portfolio.

19. The computer program product of claim 18, said control logic further comprising:

game engine means for enabling a processor to keep track of game time and game settings.

20. The computer program product of claim 18, wherein said portfolio manager engine means comprises:

available cash/minimum balance means for enabling a processor to determine how much a player is charged for buying and/or selling options and stocks.

21. The computer program product of claim 18, wherein said portfolio manager engine means comprises:

risk analysis means for enabling a processor to determine the amount of money a player can lose on any given stock or option.

22. The computer program product of claim 18, wherein said portfolio manager engine means comprises:

margin requirements means for enabling a processor to keep track of the minimum equity required in a player'"'"'s account to support a player'"'"'s total investment position.

23. The computer program product of claim 18, wherein said portfolio manager engine means comprises:

profit and loss means for enabling a processor to determine a player'"'"'s profit and loss throughout the options trading game and on a weekly basis.

24. The computer program product of claim 18, wherein said portfolio manager engine means comprises:

trading rules/limitations means for enabling a processor to prevent a player from breaking a trading rule and exceeding a limitation during game play.

25. The computer program product of claim 18, wherein said news/rumor generating means enables a processor to generate news stories and rumors about one or more companies in a player'"'"'s portfolio to affect the stock price of said one or more companies.

26. The computer program product of claim 18, wherein said basic stock price generating means enables a processor to generate semi-random movements of the price of each stock.

27. The computer program product of claim 18, wherein said options trading game is divided into four trading weeks separated by weekends to simulate a time-condensed version of a 30-day options cycle.

28. The computer program product of claim 27, wherein weekends provide a player the opportunity to relax and review a previous week'"'"'s activities, such as the news, stock quotes, and rumors, before resuming play of the trading options game.

29. The computer program product of claim 18, wherein news is displayed over a news ticker and a plurality of virtual traders interact with a player to provide rumors related to companies in a player'"'"'s pit.

30. The computer program product of claim 18, wherein one or more players trade in and out of options and equity positions as they see fit by analyzing news, rumors, and information about one or more companies until the trading options game ends.

31. The computer program product of claim 18, wherein the trading options game comprises:

means for enabling a processor to provide a trading pit where all of the action takes place;

means for enabling a processor to provide a data source of available options on companies in a player'"'"'s pit, wherein said data source provides quotes on options and equity prices;

means for enabling a processor to provide a company information screen, wherein said company information screen enables a player to learn background and historical information about the companies in the player'"'"'s pit;

means for enabling a processor to provide a stock graph for tracking prices of stocks in the player'"'"'s pit;

means for enabling a processor to provide a news archive screen for enabling the player to view relevant news on companies in the player'"'"'s pit;

means for enabling a processor to provide a portfolio screen for enabling the player to review the status of the player'"'"'s portfolio; and

means for enabling a processor to provide a help/glossary screen for enabling the player to retrieve answers to game questions and review a glossary of options terms.

32. The computer program product of claim 18, wherein said options market simulator means further comprises floor broker means for enabling a processor to provide a floor broker, wherein said floor broker shows up occasionally with an options deal at a price below market value, wherein a player must determine whether the options deal is a good deal or a bad deal.

33. The computer program product of claim 18, wherein said options pricing generating means comprises:

call price means for enabling a processor to generate a call price for an option;

put price means for enabling a processor to generate a put price for said option;

delta means for enabling a processor to generate a delta value for said option, wherein said delta value is a rate of change of price of an option for a change in stock price;

bid-ask price means for enabling a processor to generate a bid-ask price, wherein said bid-ask price is the spread between a bid price and an ask price; and

infinite liquidity means for enabling a processor to prevent the number of contracts in a trade from exceeding the market by placing the trade at a present option price or a stock price, wherein infinite liquidity implies that there is an infinite market;

wherein said options pricing generating means enables a processor to compute the price of options using a Black-Scholes formula.

34. The computer program product of claim 18, further comprising strike price generating means for enabling a processor to create option series to enable the availability of option series at attractive prices for potential investors.