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Methods and apparatus relating to the formulation and trading of investment contracts

  • US 8,229,817 B2
  • Filed: 10/28/2009
  • Issued: 07/24/2012
  • Est. Priority Date: 07/07/1995
  • Status: Expired due to Fees
First Claim
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1. A data processing system to enable the formulation of multi-party investment contracts, the system comprising:

  • input means for allowing an ordering party to input contract data relating to a least one phenomenon, each said phenomenon having a range of future outcomes and a future time of maturity, the contract data including a set of probabilities of occurrence for each outcome in said range and a consideration due to a counterparty at or after the time of matching, and further by which at least one counterparty can input registering data including a set of probabilities of occurrence for each outcome in said range; and

    a processor configured to price and match a contract for a said phenomenon from said contract data and said registering data, wherein said processor configured to price said contract by;

    applying at least one template of entitlement as a function of outcome to each counterparty'"'"'s set of probabilities to give one or more individual counterparty prices each equal to the ordering party'"'"'s consideration; and

    applying the ordering party set of probabilities to each said template to derive an implied entitlement;

    wherein said processor is configured to match said contract by;

    determining which counterparty will provide the best entitlement on maturity by comparing each implied entitlement with the consideration; and

    wherein said processor is configured to match the contract with that counterparty having the template for the best said comparison.

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