Electronic spread trading tool

• US 8,666,872 B2
• Filed: 08/18/2009
• Issued: 03/04/2014
• Est. Priority Date: 06/14/2001
• Status: Active Grant

• Current Assignee: Trading Technologies International, Inc.
• Original Assignee: Trading Technologies International, Inc.
• Inventors: Burns, Michael J., Singer, Scott F.
• Primary Examiner(s): Nguyen, Nga B.
• Application Number:
  US12/543,315
• Publication Number:
  US 20090307127A1
• Time in Patent Office: 1,659 Days
• Field of Search: 705/35, 705/36, 705/37, 705/38, 705/36.R
• US Class Current: 705/37
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• 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

Abstract

A versatile and efficient electronic spread trading tool to be used when buying and selling comparable commodities either simultaneously or in conjunction with one another. The spread trading tool involves a method of displaying, on an electronic display device, the market depth of a plurality of commodities including an anchor commodity and a non-anchor commodity, where the method includes dynamically displaying a plurality of bids and asks in the market for the commodities, statically displaying prices corresponding to those plurality of bids and asks, where the bids and asks are displayed in alignment with the prices corresponding thereto, displaying an anchor visual indicator corresponding to and in alignment with a desired price level of the anchor commodity, displaying a price level indicator corresponding to and in alignment with a price level of the non-anchor commodity. Based on an unhedged position, and taking into account the parameters and spread price point values, as determined by the trader, price level indicators are calculated and displayed, which provide a visual representation of where the trader should buy and sell the applicable commodities. The price level for the price level indicator in the non-anchor commodity is determined based upon said desired price level of the anchor commodity. The price level indicator also includes a first visual indicator corresponding to and in alignment with a first price level of the non-anchor commodity and a second visual indicator corresponding to and in alignment with a second price level of the non-anchor commodity.

Claims

1. A computer-based method for facilitating the entry of an order for a commodity being traded electronically, the order having a quantity and a price, the method comprising:

receiving by a computing device a current position for a first commodity, wherein the current position comprises a particular quantity of the first commodity that has been bought or sold;

automatically calculating by the computing device a value based in part on a formula and the current position for the first commodity, wherein the formula is associated with a spread established between the first commodity and a second commodity;

automatically setting by the computing device a quantity based on the calculated value for an order to be sent to an electronic exchange, wherein the order comprises a request to buy or sell the automatically set quantity of the second commodity at a specified price; and

generating by the computing device an order message for the order to buy or sell the second commodity, the order message to be sent to the electronic exchange and comprising the set quantity at the specified price.

2. The method of claim 1, wherein the formula comprises a ratio.

3. The method of claim 2, wherein the ratio has a numerator that is associated with the first commodity and a denominator that is associated with the second commodity.

4. The method of claim 1, wherein calculating a value comprises multiplying the current position for the first commodity by a ratio.

5. The method of claim 1, wherein the first and second commodities comprise legs of a spread and the formula comprises a spread ratio.

6. The method of claim 1, further comprising sending by the computing device the order message to the electronic exchange.

7. The method of claim 6, wherein sending the order message is done in response to a single action of a user input device.

8. The method of claim 7, further comprising displaying by the computing device a plurality of bid and ask indicators for the second commodity in relation to a plurality of price levels on a price axis.

9. The method of claim 8, wherein the single action of the user input device comprises selecting an area associated with a price level on the price axis with a pointer of the user input device positioned over the area associated with the price level on the price axis.

10. The method of claim 7, wherein the single action sets a price parameter for the order.

11. The method of claim 1, further comprising initiating by the computing device placement of the order for the second commodity that comprises an order quantity value equal to the set quantity.

12. The method of claim 11, wherein initiating placement of the order is accomplished through a single action of a user input device.

13. The method of claim 11, further comprising displaying by the computing device bid and ask indicators for the second commodity in relation to price levels on a price axis.

14. The method of claim 13, wherein initiating placement of the order is accomplished through a single action of a user input device with a pointer positioned over an area associated with a price level on the price axis.

15. The method of claim 1, further comprising automatically recalculating by the computing device the value when the current position for the first commodity changes.

16. The method of claim 15, further comprising setting by the computing device the quantity for the order for the second commodity to the recalculated value.

17. The method of claim 1, further comprising displaying by the computing device the quantity.

18. The method of claim 1, wherein the current position comprises a trader'"'"'s net position for the first commodity.

19. The method of claim 1, wherein the first commodity comprises an anchor leg of a spread and the second commodity comprises a non-anchor leg of the spread.