Method and system for facilitating automated interaction of marketable retail orders and professional trading interest at passively determined prices

• US 7,035,819 B1
• Filed: 05/05/2000
• Issued: 04/25/2006
• Est. Priority Date: 09/24/1999
• Status: Expired due to Term

• Current Assignee: D E SHAW & Company LP
• Original Assignee: De SHAW & Company
• Inventors: Shaw, David E., Gianakouros, Nicholas P.
• Primary Examiner(s): Kazimi, Hani M.
• Assistant Examiner(s): KARMIS, STEFANOS
• Application Number:
  US09/565,444
• Time in Patent Office: 2,181 Days
• Field of Search: 705/35, 705/36, 705/37, 705/38, 705/39
• US Class Current: 705/37
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

A method and system for an automated trading network that continuously collects invisible, anonymous, binding orders and indications of interest to buy and sell specific equity securities at variable, passively determined prices and, then, executes trades based on these collected orders and indications. In general, the binding orders are collected from retail broker-dealers and the binding indications are collected from institutions. The variable, passively determined, non-discrete prices can be linked to the National Best Bid or Offer (NBBO) for each security, or some other prevailing market indicator, at the time a trade is executed. In an embodiment of the method and system, marketable retail orders which match with one or more collected institutional indications, are routed from a Dynamic Order Router (DOR) at each broker-dealer to a Central Order-Match Box (COMB) to be executed against the one or more matched collected institutional indications. The COMB also manages most other aspects of transactions in the method and system and continuously executes trades against the collected institutional indications at improved prices relative to the NBBO.

Claims

1. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system first active binding indication to trade a security at a non-discrete price from at least one institution, said first active binding indication to trade is said security being a non-retail order to trade primarily against retail orders and said non-discrete price being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

transmitting from said automated trading system information on said first active binding indication to trade said security at non-discrete prices to a source of binding orders;

receiving at said automated trading system as a result of said transmitted information a query from said source of binding orders to request an instruction regarding a binding order to trade said security, said binding order to trade being a retail marketable order;

transmitting from said automated trading system said instruction to said one source of binding orders, said instruction being to transmit said binding order to trade said security, if said binding order is an opposite side binding order to trade said security which is on an opposite side of said first active binding indication to trade said security, or to decline said binding order to trade said security;

receiving at said automated trading system said opposite side binding order to trade said security from said source of binding orders, if said instruction was to transmit said opposite side binding order to trade said security; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said opposite side binding order to trade said security immediately upon receipt of said opposite side binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said opposite side binding order to trade are invisible to other market participants and said at least one institution and said source of binding orders are anonymous to each other.

2. The method of claim 1, wherein said instruction to transmit said binding order to trade comprises:

directly routing said binding order to trade.

3. The method of claim 1, wherein said instruction to transmit said binding order to trade comprises:

tagging said binding order to trade to be subsequently routed by a primary order routing system; and

forwarding said tagged binding order to trade to said primary order routing system to be routed.

13. The method of claim 1, wherein said active first-entity binding indication to trade is alternatively a non-retail order to trade only against said retail orders.

14. The method of claim 1, further comprising:

executing at said automated trading system an institution-to-institution trade defined by said first active binding indication to trade said security and a second active binding indication to trade said security immediately upon receipt of said second active binding indication to trade said security, if said second active binding indication to trade said security is on an opposite side of said first active binding indication to trade said security and said first and second active binding indications to trade said security are from different institutions, said institution-to-institution trade is executed so that each of said first and second active binding indications to trade said security are invisible to other market participants and said different institutions are anonymous to each other.

4. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade said security at a non-discrete price from an institution, said first active binding indication to trade is said security being a non-retail order to trade primarily against retail orders and said non-discrete price being determined using national best bid and offer (NBBO) data or another passive pricing mechanism;

storing at said automated trading system said first active binding indication to trade said security;

receiving at said automated trading system a binding order to trade said security from a source of binding orders, said binding order to trade said security being a retail marketable order; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said binding order to trade said security immediately upon receipt of said binding order to trade said security, if said binding order to trade said security is on an opposite side of said first active binding indications to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said opposite side binding order to trade are invisible to other market participants and said institution and said source of binding orders are anonymous to each other.

15. The method of claim 4, further comprising:

executing at said automated trading system an institution-to-institution trade defined by said first active binding indication to trade said security and a second active binding indication to trade said security immediately upon receipt of said second active binding indication to trade said security, said second active binding indication being a non-retail order to trade at said non-discrete price, if said second active binding indication to trade said security is on an opposite side of said first active binding indication to trade said security and said first and second active binding indications to trade said security are from different institutions, said institution-to-institution trade is executed so that each of said first and second active binding indications to trade said security are invisible to other market participants and said different institutions are anonymous to each other.

16. The method of claim 4, further comprising at least one of:

returning from said automated trading system said binding order to trade said security to said source of said binding order to trade said security, if said binding order to trade said security is unexecuted against said first active binding indication to trade said security;

transmitting from said automated trading system said binding order to trade said security to one of an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), and any other market center, if said binding order to trade said security is unexecuted against said first active binding indication to trade said security;

transmitting from said automated trading system said binding order to trade said security to an order routing service bureau or similar entity for routing to an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), or any other market center, if said binding order to trade said security is unexecuted against said first active binding indication to trade said security; and

executing at said automated trading system said binding order to trade said security as one of an exchange, a market maker, an electronic communications network (ECN), an alternative trading system (ATS), and another market center by acting as principal, an agent, or a riskless principal, if said binding order to trade said security is unexecuted against said first active binding indication to trade said security.

17. The method of claim 4, wherein said first active binding indication to trade is alternatively a non-retail order to trade only against retail orders.

5. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system an active first-entity binding indication to trade a security at non-discrete prices, said active first-entity binding indication to trade a security being a non-retail order to trade primarily against retail orders;

storing at said automated trading system said active first-entity binding indication to trade said security; and

executing at said automated trading system a trade defined by said active first-entity binding indication to trade said security and a second-entity binding order to trade said security immediately upon receipt of said second-entity binding order to trade said security, said second-entity binding order to trade said security being a retail marketable order, if said active first-entity binding indication to trade said security is on an opposite side of said second-entity binding order to trade said security, said first-entity binding indication to trade and said second-entity binding order to trade being invisible to other market participants and a source of said first-entity binding indication and a source of said second-entity binding order to trade being anonymous to each other.

6. The method of claim 5, wherein the trade defined by said active first-entity binding indication and said second-entity binding order to trade said security is executed by a sponsor acting as an agent or as a riskless principal.

7. The method of claim 6, wherein said sponsor is a registered broker dealer that serves as a counter-party for the trade, so that the identities of the sources of the active first-entity binding indication and the second-entity binding order to trade said security are anonymous to each other before, during and after a clearance and settlement process.

8. The method of claim 6, wherein said sponsor is a source of one or more of said active first-entity binding indication to trade and of said second-entity binding order to trade.

9. The method of claim 5, wherein said active first-entity binding indication to trade comprises:

a trading symbol representing said security;

a side for said trade of said security, wherein said side is defined as either a buy or a sell; and

a quantity representing a number of shares of said security to be traded.

10. The method of claim 9, wherein said active first-entity binding indication to trade further comprises:

a price limit.

11. The method of claim 5, wherein said second-entity binding order to trade comprises at least:

a trading symbol representing said security;

a side for said trade of said security;

a quantity representing a number of shares of said security to be traded; and

an order type selected from at least a post-open market order and a marketable limit order.

12. The method of claim 5, wherein said active first-entity binding indication to trade and said second-entity binding order to trade are invisible to other market participants such that neither said active first-entity binding indication to trade nor said second-entity binding order to trade are displayed on any terminal or in any quotation.

18. The method of claim 5, wherein said active first-entity binding indication to trade is alternatively a non-retail order to trade only against retail orders.

19. The method of claim 5, further comprising:

receiving at said automated trading system an active second-entity binding non-retail indication to trade said security at non-discrete prices;

determining whether said active second-entity binding non-retail indication to trade said security is on an opposite side of said active first-entity binding non-retail indication to trade said security; and

executing at said automated trading system a trade defined by said active first-entity binding non-retail indication to trade said security and said active second-entity binding non-retail indication to trade said security, if said active second-entity binding non-retail indication to trade said security is on an opposite side of said active first-entity binding non-retail indication to trade said security, said trade being executed so that said source of said active first-entity binding non-retail indication to trade said security and a source of said active second-entity binding non-retail indication to trade said security are anonymous to each other.

20. The method of claim 5, further comprising at least one of:

returning said binding retail order to trade said security to said source of said binding retail order to trade said security from said automated trading system, if said binding retail order to trade said security is unexecuted against said active first-entity binding non-retail indication to trade said security;

transmitting from said automated trading system said binding retail order to trade said security to one of an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), and any other market center, if said binding retail order to trade said security is unexecuted against said active first-entity binding non-retail indication to trade said security;

transmitting from said automated trading system said binding retail order to trade said security to an order routing service bureau or similar entity for routing to an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), or any other market center, if said binding retail order to trade said security is unexecuted against said active first-entity binding non-retail indication to trade said security; and

executing at said automated trading system said binding retail order to trade said security as one of an exchange, a market maker, an electronic communications network (ECN), an alternative trading system (ATS), and another market center by acting as principal, an agent, or a riskless principal, if said binding retail order to trade said security is unexecuted against said active first-entity binding non-retail indication to trade said security.

21. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at a non-discrete price from an institution, said first active binding indication to trade said security being a non-retail order to trade primarily against retail orders and said non-discrete price being determined using a passive pricing mechanism;

storing at said automated trading system said first active binding indication to trade said security;

transmitting from said automated trading system information on said first active binding indication to trade said security to a source of binding orders;

receiving at said automated trading system a binding order to trade said security from said source of binding orders as a result of said transmitted information, if said binding order to trade said security is on an opposite side of said first active binding indication to trade said security, said binding order to trade said security being a retail marketable order; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said binding order to trade said security immediately upon receipt of said binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said binding order to trade are invisible to other market participants and said institution and said source of binding orders are anonymous to each other.

22. The method of claim 21, wherein said receiving at said automated trading system a binding order to trade said security comprises:

receiving at said automated trading system at least one query from said source of binding orders to request an instruction regarding a binding order to trade said security, said binding order to trade being a retail marketable order;

transmitting from said automated trading system said instruction to said source of binding orders, said instruction being to transmit said binding order to trade said security, if said binding order to trade said security is said opposite side binding order to trade said security, which is on an opposite side of said first active binding indication to trade said security; and

receiving at said automated trading system said opposite side binding order to trade said security from said source of binding orders, if said instruction was to transmit said opposite side binding order to trade said security.

23. The method of claim 21, wherein said first active binding indication to trade is alternatively a non-retail order to trade only against retail orders.

24. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system an active binding non-retail indication to trade a security primarily against retail orders;

receiving at said automated trading system a binding retail order to trade said security, said binding retail order to trade said security being a marketable order;

determining at said automated trading system whether said binding retail order to trade said security is on an opposite side of said active binding non-retail indication to trade said security; and

executing at said automated trading system a trade defined by said active binding non-retail indication to trade said security and said binding retail order to trade said security, if said binding retail order to trade said security is on an opposite side of said active binding non-retail indication to trade said security, said trade being executed so that a source of said active binding non-retail indication to trade said security and a source of said binding retail order to trade are anonymous to each other.

25. The method of claim 24, wherein said active binding non-retail indication is a non-retail order to trade at a passively determined price.

26. The method of claim 24 wherein said active binding non-retail indication and said binding retail order are invisible to other market participants.

27. The method of claim 24, wherein the trade defined by said active binding non-retail indication and said binding retail order to trade said security is executed by a sponsor acting as an agent or as a riskless principal.

28. The method of claim 24, wherein said receiving said active binding non-retail indication to trade said security comprises:

receiving said active binding non-retail indication to trade said security at non-discrete prices.

29. The method of claim 24, further comprising:

receiving at said automated trading system a second active binding non-retail indication to trade said security at non-discrete prices;

determining at said automated trading system whether said second active binding non-retail indication to trade said security is on an opposite side of said active binding non-retail indication to trade said security; and

executing at said automated trading system a trade defined by said active binding non-retail indication to trade said security and said second active binding non-retail indication to trade said security, if said second active binding non-retail indication to trade said security is on an opposite side of said active binding non-retail indication to trade said security, said trade being executed so that said source of said active binding non-retail indication to trade said security and a source of said second active binding non-retail indication to trade said security are anonymous to each other.

30. The method of claim 24, further comprising at least one of:

returning said binding retail order to trade said security to said source of said binding retail order to trade said security from said automated trading system, if said binding retail order to trade said security is unexecuted against said active binding non-retail indication to trade said security;

transmitting from said automated trading system said binding retail order to trade said security to one of an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), and any other market center, if said binding retail order to trade said security is unexecuted against said active binding non-retail indication to trade said security;

transmitting from said automated trading system said binding retail order to trade said security to an order routing service bureau or similar entity for routing to an exchange, a market-maker, an electronic communications network (ECN), an alternative trading system (ATS), or any other market center, if said binding retail order to trade said security is unexecuted against said active binding non-retail indication to trade said security; and

executing at said automated trading system said binding retail order to trade said security as one of an exchange, a market maker, an electronic communications network (ECN), an alternative trading system (ATS), and another market center by acting as principal, an agent, or a riskless principal, if said binding retail order to trade said security is unexecuted against said active binding non-retail indication to trade said security.

31. The method of claim 24, wherein said active binding non-retail indication to trade is alternatively a non-retail order to trade only against retail orders.

32. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade primarily against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

transmitting from said automated trading system information regarding said first active binding indication to trade said security and current NBBO data for said security to a module integrated into the internal systems of a source of binding orders, said module to dynamically monitor said binding orders prior to their routing to one or more market centers for execution and said binding orders being retail orders to trade;

utilizing said information regarding said first active binding indication to trade said security and said NBBO data for said security to enable said module to identify a match-eligible binding order to trade said security, said match-eligible binding order being a marketable order to trade said security, which is on an opposite side of said first active binding indication to trade said security;

receiving at said automated trading system a query from said module to request an instruction regarding said match-eligible binding order;

transmitting from said automated trading system said instruction to said module, said instruction to specify whether to specially route said match-eligible binding order to trade said security or to decline to specially route said match-eligible binding order to trade said security;

receiving at said automated trading system said match-eligible binding order to trade said security from said source of binding orders, if said instruction was to specially route said match-eligible binding order to trade said security; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said match-eligible binding order to trade said security immediately upon receipt of said match-eligible binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said match-eligible binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other.

33. The method of claim 32, wherein the trade defined by said first active binding indication to trade and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

34. The method of claim 33, wherein said sponsor is a source of said first active binding indication to trade and of said match-eligible binding order to trade.

35. A method for the continuous-buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade primarily against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

transmitting from said automated trading system information regarding said first active binding indication to trade said security to a module integrated into the internal systems of a source of binding orders, said module to dynamically monitor said binding orders prior to their routing to one or more market centers for execution and said binding orders being retail orders to trade;

utilizing said information regarding said first active binding indication to trade said security to enable said module to identify an opposite-side binding order to trade said security, said opposite-side binding order being an order to trade said security which is on an opposite side of said first active binding indication to trade said security;

receiving at said automated trading system said opposite-side binding order to trade said security from said source of binding orders;

using said NBBO data to determine whether said opposite-side binding order to trade said security is a match-eligible binding order to trade said security, said match-eligible binding order being an opposite-side binding order to trade said security that is marketable; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said opposite-side binding order to trade said security, if said opposite-side binding order is a match-eligible binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said match-eligible binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other; and

executing, displaying, or routing said opposite-side binding order to trade said security as one of an exchange, an ECN, an ATS, a market-maker, a dealer, or an order-routing system, if said opposite-side binding order is not a match-eligible binding order to trade said security.

36. The method of claim 35, wherein the trade defined by said first active binding indication to trade and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

37. The method of claim 36, wherein said sponsor is a source of one or more of said first active binding indication to trade and of said match-eligible binding order to trade.

38. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade primarily against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

receiving at said automated trading system a binding order to trade said security from a source of binding orders, said binding orders being retail orders to trade;

determining whether said binding order is a match-eligible binding order, said match-eligible binding order being a marketable order to trade said security, which is on an opposite side of said first active binding indication to trade said security;

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said binding order to trade said security, if said binding order to trade said security is a match-eligible binding order, said institution-to-retail trade being executed so that said first active binding indication to trade and said binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other; and

executing, displaying, or routing said binding order to trade said security as one of an exchange, an ECN, an ATS, a market-maker, a dealer, or an order-routing system, if said binding order is not a match-eligible binding order.

39. The method of claim 38, wherein the trade defined by said first active binding indication and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

40. The method of claim 39, wherein said sponsor is a source of one or more of said first active binding indication to trade and of said match-eligible binding order to trade.

41. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade only against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

transmitting from said automated trading system information regarding said first active binding indication to trade said security and current NBBO data for said security to a module integrated into the internal systems of a source of binding orders, said module to dynamically monitor said binding orders prior to their routing to one or more market centers for execution and said binding orders being retail orders to trade;

utilizing said information regarding said first active binding indication to trade said security and said NBBO data for said security to enable said module to identify a match-eligible binding order to trade said security, said match-eligible binding order being a marketable order to trade said security, which is on an opposite side of said first active binding indication to trade said security;

receiving at said automated trading system a query from said module to request an instruction regarding said match-eligible binding order;

transmitting from said automated trading system said instruction to said module, said instruction to specify whether to specially route said match-eligible binding order to trade said security or to decline to specially route said match-eligible binding order to trade said security;

receiving at said automated trading system said match-eligible binding order to trade said security from said source of binding orders, if said instruction was to specially route said match-eligible binding order to trade said security; and

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said match-eligible binding order to trade said security immediately upon receipt of said match-eligible binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said match-eligible binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other.

42. The method of claim 41, wherein the trade defined by said first active binding indication to trade and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

43. The method of claim 42, wherein said sponsor is a source of one or more of said first active binding indication to trade and of said match-eligible binding order to trade.

44. A method for the continuous-buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade only against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

transmitting information regarding said first active binding indication to trade said security to a module integrated into the internal systems of a source of binding orders from said automated trading system, said module to dynamically monitor said binding orders prior to their routing to one or more market centers for execution and said binding orders being retail orders to trade;

utilizing said information regarding said first active binding indication to trade said security to enable said module to identify an opposite-side binding order to trade said security, said opposite-side binding order being an order to trade said security which is on an opposite side of said first active binding indication to trade said security;

receiving at said automated trading system said opposite-side binding order to trade said security from said source of binding orders;

using said NBBO data to determine whether said opposite-side binding order to trade said security is a match-eligible binding order to trade said security, said match-eligible binding order being an opposite-side binding order to trade said security that is marketable;

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said opposite-side binding order to trade said security, if said opposite-side binding order is a match-eligible binding order to trade said security, said institution-to-retail trade being executed so that said first active binding indication to trade and said match-eligible binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other; and

executing, displaying, or routing said opposite-side binding order to trade said security as one of an exchange, an ECN, an ATS, a market-maker, a dealer, or an order-routing system, if said opposite-side binding order is not a match-eligible binding order to trade said security.

45. The method of claim 44, wherein the trade defined by said first active binding indication to trade and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

46. The method of claim 45, wherein said sponsor is a source of one or more of said first active binding indication to trade and of said match-eligible binding order to trade.

47. A method for the continuous buying and selling of securities through an automated trading system, comprising:

receiving at an automated trading system a first active binding indication to trade a security at non-discrete prices from at least one institution, said first active binding indication to trade said security being a non-retail order to trade only against retail orders and said non-discrete prices being determined using national best bid and offer (NBBO) data;

storing at said automated trading system said first active binding indication to trade said security;

receiving at said automated trading system a binding order to trade said security from a source of binding orders, said binding orders being retail orders to trade;

determining whether said binding order is a match-eligible binding order, said match-eligible binding order being a marketable order to trade said security, which is on an opposite side of said first active binding indication to trade said security;

executing at said automated trading system an institution-to-retail trade defined by said first active binding indication to trade said security and said binding order to trade said security, if said binding order to trade said security is a match-eligible binding order, said institution-to-retail trade being executed so that said first active binding indication to trade and said binding order to trade are not displayed to other market participants and said at least one institution and said source of binding orders are anonymous to each other; and

executing, displaying, or routing said binding order to trade said security as one of an exchange, an ECN, an ATS, a market-maker, a dealer, or an order-routing system, if said binding order is not a match-eligible binding order.

48. The method of claim 47, wherein the trade defined by said first active binding indication and said match-eligible binding order to trade is executed by a system sponsor acting as an agent or as a riskless principal.

49. The method of claim 48, wherein said sponsor is a source of one or more of said first active binding indication to trade and of said match-eligible binding order to trade.