Routing of orders in equity options by means of a parameterized rules-based routing table
First Claim
Patent Images
1. A method for options order routing, comprising:
- (a) listing by a computing system, on a market center, having at least one processor and at least one memory a plurality of options series, wherein the computing system has an order book for each option series and a market maker quote book for each option series, has intermarket linkages and direct connections to a plurality of away market centers, receives a top-of-book best bid and offer disseminated quotation from the plurality of away market centers for each option series, and has at least one configurable routing table including a set of routing rules that specify intermarket linkage and direct connection parameters for each away market center;
(b) receiving by the computing system an incoming order;
(c) determining by the computing system whether the order can execute at the NBBO or better;
(d) responsive to determining that the order can execute at the NBBO or better;
(d)(i) retrieving by the computing system the best bid and offer disseminated quotation from each away market center;
(d)(ii) determining by the computing system whether a disseminated quotation of any away market center is superior to the orders and market maker quotes resident on the market center;
(d)(iii) responsive to determining that the disseminated quotation of any away market center is superior;
(d)(iii)(a) retrieving by the computing system the set of routing rules from the routing table for the away market center having the superior disseminated quotation;
(d)(iii)(b) determining by the computing system whether the incoming order can be routed to the away market center having the superior disseminated quotation;
(d)(iii)(c) responsive to determining that the incoming order can be routed to the away market center having the superior disseminated quotation;
(d)(iii)(c)(i) determining by the computing system an appropriate routing protocol and generating an outbound order based on the routing rules for the specified away market center; and
(d)(iii)(c)(ii) routing by the computing system the generated outbound order to the away market center having the superior disseminated quotation over the selected routing protocol.
2 Assignments
0 Petitions
Accused Products
Abstract
An enhanced system and method for the “smart” routing of orders in an electronic options environment is disclosed. The method of routing includes different rules and protocols for orders that are allowed to route using a traditional intermarket linkage than for orders that are allowed to route using an alternative private direct connection or third-party service provider. The system and method of routing has at its basis a configurable, rules-based routing table that allows orders to be routed using different protocols based on the account type of the incoming order.
172 Citations
51 Claims
-
1. A method for options order routing, comprising:
-
(a) listing by a computing system, on a market center, having at least one processor and at least one memory a plurality of options series, wherein the computing system has an order book for each option series and a market maker quote book for each option series, has intermarket linkages and direct connections to a plurality of away market centers, receives a top-of-book best bid and offer disseminated quotation from the plurality of away market centers for each option series, and has at least one configurable routing table including a set of routing rules that specify intermarket linkage and direct connection parameters for each away market center; (b) receiving by the computing system an incoming order; (c) determining by the computing system whether the order can execute at the NBBO or better; (d) responsive to determining that the order can execute at the NBBO or better; (d)(i) retrieving by the computing system the best bid and offer disseminated quotation from each away market center; (d)(ii) determining by the computing system whether a disseminated quotation of any away market center is superior to the orders and market maker quotes resident on the market center; (d)(iii) responsive to determining that the disseminated quotation of any away market center is superior; (d)(iii)(a) retrieving by the computing system the set of routing rules from the routing table for the away market center having the superior disseminated quotation; (d)(iii)(b) determining by the computing system whether the incoming order can be routed to the away market center having the superior disseminated quotation; (d)(iii)(c) responsive to determining that the incoming order can be routed to the away market center having the superior disseminated quotation; (d)(iii)(c)(i) determining by the computing system an appropriate routing protocol and generating an outbound order based on the routing rules for the specified away market center; and (d)(iii)(c)(ii) routing by the computing system the generated outbound order to the away market center having the superior disseminated quotation over the selected routing protocol. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 47, 48)
-
-
46. A market center system which lists a plurality of options series and routes orders to away market centers, comprising:
-
a market center comprising; (a) an order book for each option series and a market maker quote book for each option series, intermarket linkages and direct connections to a plurality of away market centers, and at least one configurable routing table including a set of routing rules; (b) an interface for receiving orders, an interface for receiving quotes and an interface for receiving a top-of-book best bid and offer disseminated quotation from a plurality of away market centers for each option series; (c) at least one memory for storing code for analyzing and processing orders and quotes; (d) at least one computer processor for interacting with the interfaces and executing the code for analyzing and processing quotes and orders, wherein the code, when executed; (d)(i) receives an incoming order; (d)(ii) determines whether the order can execute at the NBBO or better; (d)(iii) responsive to determining that the order can execute at the NBBO or better, retrieves the best bid and offer disseminated quotation from each away market center; (d)(iv) determines whether a disseminated quotation of any away market center is superior to the orders and market maker quotes resident on the market center; (d)(v) responsive to determining that the disseminated quotation of any away market center is superior, retrieves the set of routing rules from the routing table for the away market center having the superior disseminated quotation; (d)(vi) determines whether the incoming order can be routed to the away market center having the superior disseminated quotation; (d)(vii) responsive to determining that the incoming order can be routed to the away market center having the superior disseminated quotation, determines an appropriate routing protocol and generates an outbound order based on the routing rules for the specified away market center; and (d)(viii) routes the generated outbound order to the away market center having the superior disseminated quotation over the selected routing protocol. - View Dependent Claims (49, 50, 51)
-
Specification