Method and apparatus for enabling individual or smaller investors or others to create and manage a portfolio of securities or other assets or liabilities on a cost effective basis

• US 8,099,344 B2
• Filed: 07/28/2003
• Issued: 01/17/2012
• Est. Priority Date: 03/11/1998
• Status: Expired due to Fees

• Current Assignee: Folio Financial Incorporated (Goldman Sachs Group Incorporated)
• Original Assignee: FOLIOfn Incorporated (Goldman Sachs Group Incorporated)
• Inventors: Wallman, Steven M. H.
• Primary Examiner(s): Cheung, Mary
• Assistant Examiner(s): GREENE, DANIEL LAWSON
• Application Number:
  US10/627,626
• Publication Number:
  US 20040024677A1
• Time in Patent Office: 3,095 Days
• Field of Search: 705/35, 705/36.R, 705/37
• US Class Current: 705/35
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• 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
• CPC Class Codes: G06Q 40/10 Tax strategies
• CPC Class Codes: G06Q 40/12 Accounting

Abstract

An investor adjusts a risk-return characteristic of a portfolio of investments by using a graphical user interface to adjust a pointer on a screen up or down. In response, the computer system automatically recalculates the required mix of the portfolio'"'"'s stocks. Trades are then sent to the system for execution to implement the adjusted portfolio. Thus, investors are afforded a simple click-of-a-mouse mechanism to adjust their entire portfolio to precisely the types of portfolio characteristics desired without having to know about the various interactions of securities with each other or the portfolio effects of changing one security or another or have any other knowledge.

Claims

1. A computer implemented method for creating a portfolio of market tradable investments to be directly owned by an investor comprising the steps of:

providing a graphical user interface to enable a user to select, using a computer, a portfolio of market tradable investments, said portfolio including a plurality of different market tradable investments, to be directly owned by the investor from a plurality of potential investment options;

providing a graphical user interface to enable the user to adjust, using a computer, a desired risk-return characteristic of said selected portfolio by adjusting a risk-return pointer via the graphical user interface;

providing a graphical user interface to enable the user to transmit over a computer network a single trading order to purchase an entire risk adjusted portfolio including a plurality of selected market tradable investments to be directly owned by the investor;

receiving by a portfolio trading system over the computer network the single trading order from the user; and

converting automatically by the portfolio trading system the single trading order into a plurality of trading orders to trade each of the plurality of selected market tradable investments in a market for each of the plurality of selected market tradable investments.

2. The computer implemented method according to claim 1, further comprising:

determining automatically by the computer a weighting of a plurality of instruments in the portfolio to accommodate said adjusted risk-return characteristic.

3. The computer implemented method according to claim 1, further comprising:

netting via a computer, for at least one distinct investment of the plurality of selected market tradable investments, at least one buy order from the user with at least one sell order from one or more other users.

4. The computer implemented method according to claim 1, further comprising:

netting via a computer, for at least one distinct investment of the plurality of selected market tradable investments, at least one sell order from the user with at least one buy order from one or more other users.

5. The method according to claim 1, further comprising:

receiving one or more portfolio characteristic parameters that will be permitted for the investor;

prompting the user for investor preference information; and

receiving from the user a selection of a plurality of investments;

said plurality of investments defining a portfolio commensurate with said investment preference information and said one or more portfolio characteristic parameters.

6. The method according to claim 1, wherein the plurality of transactions include an order to trade at least one of the plurality of selected market tradable investments in response to a periodic monetary contribution.

7. The computer implemented method according to claim 1, further comprising:

maintaining in a separate account up to one single share of each distinct investment in which there was at least one trading order for a fractional share of said each distinct investment, wherein said maintaining includes holding any remaining fractional shares of said at least one investment after allocating for subsequent trading.

8. The computer implemented method according to claim 1, further comprising:

aggregating via a computer, for each distinct investment of the plurality of selected market tradable investments, the trading order from the user with one or more trading orders from one or more other users.

9. The computer implemented method according to claim 8, wherein said aggregating includes combining at least one economically unviable trading order of said each distinct investment with at least one other trading order of said each distinct investment.

10. The computer implemented method according to claim 9, wherein said at least one economically unviable trading order includes a single share of said each distinct investment.

11. The computer implemented method according to claim 9, wherein said at least one economically unviable trading order includes an odd lot of said each distinct investment.

12. The computer implemented method according to claim 9, wherein said at least one economically unviable trading order includes a fractional share of said each distinct investment.

13. The computer implemented method according to claim 8, further comprising executing one or more trades of said each distinct investment resulting from said aggregating.

14. The method according to claim 13, wherein said executing one or more trades comprises transmitting at least a single buy order for said each distinct investment to an electronic trading system.

15. The method according to claim 13, wherein said executing one or more trades comprises transmitting at least a single sell order for said each distinct investment to an electronic trading system.

16. The computer implemented method according to claim 1, further comprising:

aggregating via a computer, for each distinct investment of the plurality of selected market tradable investments, the trading order from the user with one or more trading orders from one or more other users to create a single aggregated buy order for said each distinct investment and a single aggregated sell order for said each distinct investment.

17. The computer implemented method according to claim 16, further comprising:

netting via a computer, for at least one of said each distinct investment, the single aggregated buy order against the single aggregated sell order to create a single order to trade said at least one of said each distinct investment.

18. The computer implemented method according to claim 16, wherein said aggregating includes combining at least one trading order involving a single share of said each distinct investment with at least one other trading order of said each distinct investment.

19. The computer implemented method according to claim 16, wherein said aggregating includes combining at least one trading order involving a fractional share of said each distinct investment with at least one other trading order of said each distinct investment.

20. The computer implemented method according to claim 16, wherein said aggregating includes combining at least one trading order involving an odd lot of said each distinct investment with at least one other trading order of said each distinct investment.