System and methods for financial instrument trading and trading simulation using dynamically generated tradescreens

• US 8,027,900 B1
• Filed: 05/17/2002
• Issued: 09/27/2011
• Est. Priority Date: 05/17/2002
• Status: Active Grant

• Current Assignee: Summalp Applications Incorporated
• Original Assignee: Summalp Applications Incorporated
• Inventors: Chaffee, Arthur Willard
• Primary Examiner(s): Akintola; Olabode
• Assistant Examiner(s): TINKLER, MURIEL S
• Application Number:
  US10/150,990
• Time in Patent Office: 3,420 Days
• Field of Search: 705/36.R, 705/35, 705/37, 705/36.T, 705/1, 705/10, 705/26, 273/256, 463/16, 463/25, 463/42, 463/1, 463/17
• US Class Current: 705/37
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

A financial instruments trading system provides a front end user interface comprising dynamically generated tradescreens that enable the trader to calculate the effects of a hypothetical trade or transfer of a financial instrument on the corresponding portfolio and on aggregate holdings of the financial instrument in that portfolio before the trade or transaction is actually executed. The tradescreens display financial information characterizing the current status of the portfolio and the current status of all holdings of the financial instrument in the portfolio. The tradescreens further include fields for entry of information characterizing the hypothetical trade or transfer, and routines for calculating the revised values of the displayed financial information for the portfolio and the holdings of the financial instrument that reflect changes that will occur in the event that the hypothetical trade or transfer is executed. Each tradescreen further enables the trader to submit the trade or transfer for execution from the tradescreen. The tradescreens are dynamically generated by a server based on portfolio data maintained in a portfolio database, and are customized to the selected financial instrument and the type of action to be taken. The submission of a trade or transfer causes data entered into the tradescreen to be communicated to the server, where the tradescreen calculations are replicated and the portfolio database and a general ledger are updated to reflect the trade or transfer. The server also dynamically generates reports describing various aspects of the portfolio'"'"'s holdings based on the data stored in the portfolio database.

Claims

1. A method in a server of a financial instruments trading system comprising:

maintaining a portfolio database in the server, the portfolio database including a portfolio of a user wherein the portfolio has current financial information for a plurality of holdings associated with the user;

receiving a request for a tradescreen from the user, the request specifying a selected financial instrument and a type of action to be taken regarding the selected financial instrument;

generating the tradescreen based on the portfolio database in the server, the tradescreen for displaying the current financial information for the portfolio, the tradescreen for calculating and displaying revised financial information for the portfolio, the tradescreen for entering proposed data comprising one of a proposed trade and a proposed transfer of the plurality of holdings of the user, the tradescreen for allowing the user to determine if the proposed data entered into the tradescreen would produce one of a first type of result and a second type of result;

providing an interface on the tradescreen for enabling the user to submit a transaction corresponding to the proposed data entered into the tradescreen to update the portfolio database in the server with the revised financial information in an event the user determines that the proposed data would produce the first type of result; and

updating the portfolio database in the server with the revised financial information upon the user submitting the transaction;

wherein the revised financial information for the portfolio of the user is based on the proposed data entered into the tradescreen and the current financial information for the portfolio of the user.

2. The method claimed in claim 1, wherein the executable tradescreen comprises:

financial information representing a current state of the portfolio;

financial information representing a current state of any holdings within the portfolio of the selected financial instrument;

fields for entry of data;

routines for calculating revised financial information representing a revised state of the portfolio reflecting changes that will occur if the transaction is executed; and

routines for calculating revised financial information representing a revised state of the holdings within the portfolio of the selected financial instrument reflecting changes that will occur if the transaction is executed.

3. The method claimed in claim 1, wherein the tradescreen is customized to the selected financial instrument and a type of action to be taken.

4. The method claimed in claim 3, wherein the selected financial instrument is a stock and wherein the type of action to be taken is opening a long position in the stock.

5. The method claimed in claim 3, wherein the selected financial instrument is a stock and wherein the type of action to be taken is closing a long position in the stock.

6. The method claimed in claim 3, wherein the selected financial instrument is a stock and wherein the type of action to be taken is opening a short position in the stock.

7. The method claimed in claim 3, wherein the selected financial instrument is a stock and wherein the type of action to be taken is closing a short position in the stock.

8. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is opening a long position in the option.

9. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by an offsetting transaction.

10. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by exercising the option.

11. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by expiration of the option.

12. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is opening a covered short position in the option.

13. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by an offsetting transaction.

14. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by exercising the option.

15. The method claimed in claim 3, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by expiration of the option.

16. The method of claim 1, wherein the portfolio is an investment portfolio comprising a financial position report, said financial position report produced by a method comprising:

obtaining single entry transaction data records for individual transactions of the investment portfolio;

receiving user input data representing a request for a financial position report for the investment portfolio;

calculating current double entry asset, liability and equity balances for the investment portfolio as a whole using the transaction data records and current prices for investments held in the investment portfolio, wherein the sum of the portfolio asset balances equals the sum of the portfolio liability balances and the portfolio equity balances, and wherein the liability balances include balances that reflect obligations that would result if all investments of the investment portfolio were liquidated at said current prices;

generating a financial position report for the portfolio that presents the asset, liability and equity balances of the portfolio in a double entry format, wherein at least some of the asset, liability and equity balances displayed in the financial position report are associated with hyperlinks to corresponding reports supporting the associated balances;

transmitting the financial position report to the user; and

in response to receiving user input data representing user selection of one of said hyperlinks associated with one of said balances, transmitting a report to the user supporting the balance associated with the selected hyperlink.

17. The method of claim 1, wherein the exchange host is a live-market exchange host.

18. The method of claim 1, wherein providing an interface on the tradescreen comprises enabling the user to not submit the transaction corresponding to the proposed data entered into the tradescreen in an event the user determines that the proposed data would produce the second type of result.

19. The method of claim 1,

wherein the first type of result comprises a result that is deemed appropriate by the user;

and

wherein the second type of result comprises a result that is deemed inappropriate by the user.

20. The method of claim 1, wherein receiving a request for a tradescreen from the user comprises receiving a request for a tradescreen from the user at the remote computer.

21. A method in a client of a financial instruments trading system comprising:

transmitting a request to a server for a tradescreen, the request specifying a selected financial instrument and a type of action to be taken;

receiving a tradescreen from the server, the tradescreen for displaying current financial information for a portfolio of a user comprising a plurality of holdings associated with the user, the tradescreen for calculating and displaying revised financial information for the portfolio, tradescreen for entering proposed data comprising one of a proposed trade and a proposed transfer of the plurality of holdings of the user, the tradescreen for allowing the user to determine if the proposed data entered into the tradescreen would produce one of a first type of result and a second type of result;

providing an interface on the tradescreen for enabling the user to submit a transaction corresponding to the proposed data entered into the tradescreen to update the portfolio database in the server with the revised financial information in an event the user determines that the proposed data would produce the first type of result; and

updating the portfolio database in the server with the revised financial information upon the user submitting the transaction;

wherein the revised financial information for the portfolio of the user is based on the proposed data entered into the tradescreen and the current financial information for the portfolio of the user.

22. The method claimed in claim 21, wherein the executable tradescreen comprises:

financial information representing a current state of the portfolio;

financial information representing a current state of any holdings within the portfolio of the selected financial instrument;

routines for calculating revised financial information representing a revised state of the portfolio reflecting changes that will occur if the transaction is executed; and

routines for calculating revised financial information representing a revised state of the holdings within the portfolio of the selected financial instrument reflecting changes that will occur the transaction is executed.

23. The method claimed in claim 21, wherein the tradescreen is customized to the selected financial instrument and a type of action to be taken.

24. The method claimed in claim 23, wherein the selected financial instrument is a stock and wherein the type of action to be taken is opening a long position in the stock.

25. The method claimed in claim 23, wherein the selected financial instrument is a stock and wherein the type of action to be taken is closing a long position in the stock.

26. The method claimed in claim 23, wherein the selected financial instrument is a stock and wherein the type of action to be taken is opening a short position in the stock.

27. The method claimed in claim 23, wherein the selected financial instrument is a stock and wherein the type of action to be taken is closing a short position in the stock.

28. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is opening a long position in the option.

29. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by an offsetting transaction.

30. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by exercising the option.

31. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a long position in the option by expiration of the option.

32. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is opening a covered short position in the option.

33. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by an offsetting transaction.

34. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by exercising the option.

35. The method claimed in claim 23, wherein the selected financial instrument is an option and wherein the type of action to be taken is closing a covered short position in the option by expiration of the option.

36. The method of claim 21, wherein the portfolio is an investment portfolio comprising a financial position report, said financial position report produced by a method comprising:

obtaining single entry transaction data records for individual transactions of the investment portfolio;

receiving user input data representing a request for a financial position report for the investment portfolio;

calculating current double entry asset, liability and equity balances for the investment portfolio as a whole using the transaction data records and current prices for investments held in the investment portfolio, wherein the sum of the portfolio asset balances equals the sum of the portfolio liability balances and the portfolio equity balances, and wherein the liability balances include balances that reflect obligations that would result if all investments of the investment portfolio were liquidated at said current prices;

generating a financial position report for the portfolio that presents the asset, liability and equity balances of the portfolio in a double entry format, wherein at least some of the asset, liability and equity balances displayed in the financial position report are associated with hyperlinks to corresponding reports supporting the associated balances;

transmitting the financial position report to the user; and

in response to receiving user input data representing user selection of one of said hyperlinks associated with one of said balances, transmitting a report to the user supporting the balance associated with the selected hyperlink.

37. The method of claim 21, wherein the exchange host is a live-market exchange host.

38. The method of claim 21, wherein providing an interface on the tradescreen comprises enabling the user to not submit the transaction corresponding to the proposed data entered into the tradescreen in an event the user determines that the proposed data would produce the second type of result.

39. The method of claim 21,

wherein the first type of result comprises a result that is deemed appropriate by the user;

and

wherein the second type of result comprises a result that is deemed inappropriate by the user.