System, method and computer program product for providing an efficient trading market

• US 7,979,343 B2
• Filed: 11/03/2008
• Issued: 07/12/2011
• Est. Priority Date: 05/18/2001
• Status: Expired due to Term

• Current Assignee: Chemtron Research LLC (Intellectual Ventures LLC)
• Original Assignee: Network Resonance Incorporated
• Inventors: Rescorla, Eric Kenneth, Dick, Kevin Stewart
• Primary Examiner(s): Akintola; Olabode
• Application Number:
  US12/264,005
• Publication Number:
  US 20090177572A1
• Time in Patent Office: 981 Days
• Field of Search: 705/37
• US Class Current: 705/37
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

A system, method and computer program product for providing a trading exchange are disclosed. A request for conducting trade of a security is received from a user. The security associated with requested trade is evaluated to generate a derivative security. A trade is then executed for the user using the derivative security. Information relating to the executed trade is captured utilizing a network so that the captured information can be utilized to adjust an account of the user in accordance with the executed trade.

Claims

1. A method, comprising:

receiving at a workstation, a request from a user to execute a trade of a specific security at a current market price for that security, the request being transmitted from the user via a network coupled to the workstation;

subsequently generating, at the workstation, a derivative security to represent the requested security, the derivative security having a price equal to the current market price of the security at a time the request was issued;

the workstation executing the requested trade using the derivative security instead of the security and without finding a counterparty for the trade of the security;

after the execution, the workstation obtaining a market price of the security at the time of the request from a financial market quotes provider from a data feed of market quotes received over the network from a financial market quote provider; and

the workstation adjusting an account of the user in accordance with the executed trade utilizing the obtained market price of the security.

2. The method of claim 1, wherein the derivative security is dynamically generated.

3. The method of claim 1, wherein the trade comprises a purchase.

4. The method of claim 3, wherein the derivative security has a limited lifetime, and the derivative security is automatically sold if the derivative security is held by the user at the end of the limited lifetime.

5. The method of claim 1, wherein the user is limited to hold an amount of the derivate security having a value equal to less than a predetermined percentage of an aggregate value of the security.

6. The method of claim 1, wherein the request includes a timestamp identifying the time of the request.

7. The method of claim 6, wherein the timestamp is compared to the data feed of market quotes to determine the price of the security.

8. The method of claim 1, wherein the user is permitted to add or remove funds from the account.

9. A system for providing a trading exchange, comprising:

a workstation coupled to a network, the workstation having;

a capture component for receiving a request from a user to execute a trade of a specific security at a current market price for that security, the request being transmitted from the user via the network;

a derivative component for generating a derivative security having a price equal to a price of the security at a time the request was issued;

a transaction component for executing the requested trade using the derivative security instead of the security and without finding a counterparty for the trade of the security;

the capture component obtaining, after the execution of the requested trade, a market price of the security at the time of the request from a data feed of market quotes received over the network from a financial market quotes provider; and

a component for adjusting an account of the user in accordance with the executed trade utilizing obtained market price of the security.

10. The system of claim 9, wherein the derivative security is dynamically generated.

11. The system of claim 9, wherein the trade comprises a purchase.

12. The system of claim 11, wherein the derivative security has a limited lifetime, and the derivative security is automatically sold if the derivative security is held by the user at the end of the limited lifetime.

13. The system of claim 9, wherein the user is limited by the trading exchange to hold an amount of the derivate security having a value equal to less than a predetermined percentage of an aggregate value of the security.

14. The system of claim 9, wherein the request includes a timestamp identifying the time of the request.

15. The system of claim 14, wherein the component for adjusting an account of the user compares the timestamp to the data feed of market quotes to determine the price of the security.

16. The system of claim 9, wherein the user is permitted to add or remove funds from the account.

17. A computer-readable storage medium having computer-executable instructions for causing a computer to perform a method, the method comprising:

receiving at a workstation, a request from a user to execute a trade of a specific security at a current market price for that security, the request being transmitted from the user via a network;

subsequently generating a derivative security to represent the requested security, the derivative security having a price equal to the current market price of the security at a time the request was issued;

executing the requested trade using the derivative security instead of the security and without finding a counterparty for the trade of the security;

after the execution, obtaining a market price of the security at the time of the request from a data feed of market quotes received over the network from a financial market quotes provider; and

adjusting an account of the user in accordance with the executed trade utilizing the obtained market price of the security.