Method and apparatus for a fair exchange

• US 8,108,297 B2
• Filed: 05/18/2010
• Issued: 01/31/2012
• Est. Priority Date: 10/02/2002
• Status: Expired due to Term

• Current Assignee: Trading Technologies International, Inc.
• Original Assignee: Trading Technologies International, Inc.
• Inventors: Schluetter, Jens-Uwe
• Primary Examiner(s): MONFELDT, SARAH M
• Application Number:
  US12/782,485
• Publication Number:
  US 20100228644A1
• Time in Patent Office: 623 Days
• Field of Search: 705/37
• 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 30/0601 Electronic shopping [e-shopping]
• 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

Abstract

A fair exchange is disclosed to reduce potential inequities in an electronic trading environment. Market data is sent from a host system to client devices through one or more synchronized local communication servers such that the data can be displayed simultaneously or nearly simultaneously at each client device. Market data sent to client devices might include price information. Likewise, a host system may transaction data sent from client devices via the local communication servers. The ordering of transaction data is based, at least in part, on when the local communication servers received the transaction data from the client devices. Transaction data sent to a host system might include order information.

Claims

1. A method including:

receiving by a host exchange a first transaction message at a first receipt time, wherein the first transaction message is received by a first network device from a first client device before being received by the host exchange;

receiving by the host exchange a second transaction message at a second receipt time, wherein the second transaction message is received by a second network device from a second client device before being received by the host exchange;

determining by the host exchange a first time based on a first travel time and the first receipt time, wherein the first travel time is a time from the first network device to the host exchange, wherein the first time is an approximation of the time at which the first network device sent the first transaction message;

determining by the host exchange a second time based on a second travel time and the second receipt time, wherein the second travel time is a time from the second network device to the host exchange, wherein the second time is an approximation of the time at which the second network device sent the second transaction message; and

prioritizing by the host exchange the first transaction message and the second transaction message based on the first time and the second time.

2. The method of claim 1, wherein the first transaction message includes an order.

3. The method of claim 1, wherein the first network device is geographically positioned at approximately the same location as the first client device and wherein the second network device is geographically positioned at approximately the same location as the second device.

4. The method of claim 1, wherein the first network device and the second network device are under control of the host exchange.

5. The method of claim 1, wherein the first travel time and the second travel time are determined by the host exchange.

6. The method of claim 1, wherein the first travel time and the second travel time are stored in a look-up table.

7. The method of claim 1, wherein the first time is determined by subtracting the first travel time from the first receipt time.

8. The method of claim 1, wherein the second time is determined by subtracting the second travel time from the second receipt time.

9. The method of claim 1, wherein the first and second transaction messages are prioritized by ordering the first and second transaction messages for processing from earliest to latest.

10. The method of claim 1, wherein the first time is determined before the second transaction message is received by the host exchange.

11. The method of claim 1, wherein the prioritizing of the first transaction message and the second transaction message is not completed until after a delay period has elapsed.

12. The method of claim 11, wherein the delay period is based on at least one of the first travel time and the second travel time.

13. The method of claim 11, wherein the delay period is preselected.

14. A system including:

a host exchange,

wherein the host exchange is adapted to receive a first transaction message at a first receipt time, wherein the first transaction message is received by a first network device from a first client device before being received by the host exchange,

wherein the host exchange is adapted to receive a second transaction message at a second receipt time, wherein the second transaction message is received by a second network device from a second client device before being received by the host exchange,

wherein the host exchange is adapted to determine a first time based on a first travel time and the first receipt time, wherein the first travel time is a time from the first network device to the host exchange, wherein the first time is an approximation of the time at which the first network device sent the first transaction message,

wherein the host exchange is adapted to determine a second time based on a second travel time and the second receipt time, wherein the second travel time is a time from the second network device to the host exchange, wherein the second time is an approximation of the time at which the second network device sent the second transaction message, and

wherein the host exchange is adapted to prioritize the first transaction message and the second transaction message based on the first time and the second time.

15. The system of claim 14, wherein the first transaction message includes an order.

16. The system of claim 14, wherein the first network device is geographically positioned at approximately the same location as the first client device and wherein the second network device is geographically positioned at approximately the same location as the second device.

17. The system of claim 14, wherein the first network device and the second network device are under control of the host exchange.

18. The system of claim 14, wherein the first travel time and the second travel time are determined by the host exchange.

19. The system of claim 14, wherein the first travel time and the second travel time are stored in a look-up table.

20. The system of claim 14, wherein the first time is determined by subtracting the first travel time from the first receipt time.

21. The system of claim 14, wherein the second time is determined by subtracting the second travel time from the second receipt time.

22. The system of claim 14, wherein the first and second transaction messages are prioritized by ordering the first and second transaction messages for processing from earliest to latest.

23. The system of claim 14, wherein the first time is determined before the second transaction message is received by the host exchange.

24. The system of claim 14, wherein the prioritizing of the first transaction message and the second transaction message is not completed until after a delay period has elapsed.

25. The system of claim 24, wherein the delay period is based on at least one of the first travel time and the second travel time.

26. The system of claim 24, wherein the delay period is preselected.

27. A computer readable medium having stored therein instructions executable by a processor to perform a method including:

receiving by a host exchange a first transaction message at a first receipt time, wherein the first transaction message is received by a first network device from a first client device before being received by the host exchange;

receiving by the host exchange a second transaction message at a second receipt time, wherein the second transaction message is received by a second network device from a second client device before being received by the host exchange;

determining by the host exchange a first time based on a first travel time and the first receipt time, wherein the first travel time is a time from the first network device to the host exchange, wherein the first time is an approximation of the time at which the first network device sent the first transaction message;

determining by the host exchange a second time based on a second travel time and the second receipt time, wherein the second travel time is a time from the second network device to the host exchange, wherein the second time is an approximation of the time at which the second network device sent the second transaction message; and

prioritizing by the host exchange the first transaction message and the second transaction message based on the first time and the second time.

28. The computer readable medium of claim 27, wherein the first transaction message includes an order.

29. The computer readable medium of claim 27, wherein the first network device is geographically positioned at approximately the same location as the first client device and wherein the second network device is geographically positioned at approximately the same location as the second device.

30. The computer readable medium of claim 27, wherein the first network device and the second network device are under control of the host exchange.

31. The computer readable medium of claim 27, wherein the first travel time and the second travel time are determined by the host exchange.

32. The computer readable medium of claim 27, wherein the first travel time and the second travel time are stored in a look-up table.

33. The computer readable medium of claim 27, wherein the first time is determined by subtracting the first travel time from the first receipt time.

34. The computer readable medium of claim 27, wherein the second time is determined by subtracting the second travel time from the second receipt time.

35. The computer readable medium of claim 27, wherein the first and second transaction messages are prioritized by ordering the first and second transaction messages for processing from earliest to latest.

36. The computer readable medium of claim 27, wherein the first time is determined before the second transaction message is received by the host exchange.

37. The computer readable medium of claim 27, wherein the prioritizing of the first transaction message and the second transaction message is not completed until after a delay period has elapsed.

38. The computer readable medium of claim 37, wherein the delay period is based on at least one of the first travel time and the second travel time.

39. The computer readable medium of claim 37, wherein the delay period is preselected.