Counterparty credit limits in computerized trading
First Claim
1. A method of using credit data in a computerized system for trading over a network financial interests having a future financial exposure, the method comprising:
- for each of a plurality of future time periods with respect to a trading session, storing in a memory device, at or prior to a start of the trading session, a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods;
storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and
during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion.
7 Assignments
0 Petitions
Accused Products
Abstract
Systems, methods, and computer program products for establishing and using credit limits between counterparties and for managing risk in the trading of financial interests. A trading party may control the amount of future financial exposure that the trading party will incur with any counterparty in one or more future time periods in trades by the trading party during a trading session. Credit limits may be used to permit proposed trades to be completed or not depending upon available credit. Where there is insufficient credit, the trade may be blocked or otherwise prevented from progressing towards completion. If there is insufficient credit and if trading up to available credit is permitted, a partial trade for an amount up to the credit limit may be allowed. During a trading session, the credit remaining of a set credit limit between the trading party and the respective counterparty is changed according to trades executed between the trading party and the counterparty. After the end of the trading session, the remaining credit may be automatically reset to the set credit limit for each counterparty and future time period.
89 Citations
33 Claims
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1. A method of using credit data in a computerized system for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device, at or prior to a start of the trading session, a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion. - View Dependent Claims (9, 10, 13, 14, 15, 16, 17, 18, 19, 31)
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2. A method of using credit data in a computerized system for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods having at least one parameter thereof set with respect to a trading session in accordance with one or more designations of a trading party, storing in a memory device, at or prior to a start of the trading session, a credit value for at least one counterparty designable by the trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion. - View Dependent Claims (6, 8)
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3. A method of using credit data in a computerized system for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device at or prior to a start of the trading session, a credit value designable by each of a pair of potential counterparties for use in connection with trading financial interests with each other, the financial interests having a financial exposure to each of the pair of counterparties in the respective future time periods; storing in the memory device a maximum credit value designable by each of the pair of potential counterparties for trading with each other, wherein the maximum credit value is associated with financial exposure to each of the pair of counterparties in two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the pair of potential counterparties of a financial interest having a financial exposure to each of the potential counterparties in a future time period towards possible completion (i) if the financial exposure to each of the potential counterparties of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the lesser of the credit values in the memory device for each of the potential counterparties for the future time period and (ii) if the total financial exposure to each of the potential counterparties in the two or more future time periods is less than the lesser of the maximum credit values stored for each of the potential counterparties, and (b) otherwise not processing the proposed trade towards possible completion. - View Dependent Claims (7, 11)
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4. A method of using credit data in a computerized system for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; and at or prior to a start of a trading session, storing the credit value for each time period and the at least one counterparty as a credit available value for use during the trading session; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit available value in the memory device for the future time period, is less than the available credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion. - View Dependent Claims (12, 32, 33)
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5. A method of using credit data in a computerized system for trading foreign exchange forwards contracts over a network, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device, at or prior to a start of the trading session, a credit value being designable by a trading party for use in connection with trading foreign exchange forwards contracts between the trading party and the at least one counterparty, each forwards contract having a forwards leg in a future time period; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a foreign exchange forwards contract for a given currency pair having a forward leg in a future time period towards possible completion (i) if the size of the proposed trade, expressed in a currency compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion proposed trade were executed. - View Dependent Claims (30)
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20. A system for computerized trading over a network of financial interests having a future financial exposure using credit data, comprising:
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at least one computer; a memory device, comprising at least one storage medium accessible by the at least one computer, that stores (i) for each of a plurality of future time periods with respect to a trading session, at or prior to a start of the trading session, a credit value designable by a trading party for use in connection with trading financial interests between the trading party and at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods, and (ii) maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; the at least one computer being programmed (a) to process, during the trading session, a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise to not process the proposed trade towards possible completion. - View Dependent Claims (22, 23, 24)
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21. A system for computerized trading over a network of financial interests having a future financial exposure using credit data, comprising:
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at least one computer; a memory device, comprising at least one storage medium accessible by the at least one computer, that stores (i) for each of a plurality of future time periods having at least one parameter thereof set with respect to a trading session in accordance with one or more designations of a trading party, at or prior to a start of the trading session, a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods, and (ii) a maximum credit value designable by the trading party for trading between the trading party and at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; the at least one computer being programmed (a) to process, during the trading session, a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device in the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise to not process the proposed trade towards possible completion.
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25. A product comprising a computer usable medium or media storing computer readable code which when executed causes at least one computer to carry out a method of using credit data for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device, at or prior to a start of the trading session, a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion. - View Dependent Claims (29)
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26. A product comprising a computer usable medium or media storing computer readable code which when executed causes at least one computer to carry out a method of using credit data for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods having at least one parameter thereof set with respect to a trading session in accordance with one or more designations of a trading party, storing in a memory device, at or prior to a start of the trading session, a credit value for at least one counterparty designable by the trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in a two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the credit value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion.
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27. A product comprising a computer usable medium or media storing computer readable code which when executed causes at least one computer to carry out a method of using credit data for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device at or prior to a start of the trading session, a credit value designable by each of a pair of potential counterparties for use in connection with trading financial interests with each other, the financial interests having a financial exposure to each of the pair of counterparties in the respective future time periods; storing in the memory device a maximum credit value designable by each of the pair of potential counterparties for trading with each other, wherein the maximum credit value is associated with financial exposure to each of the pair of counterparties in two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the pair of potential counterparties of a financial interest having a financial exposure to each of the potential counterparties in a future time period towards possible completion (i) if the financial exposure to each of the potential counterparties of the financial instrument in the future time period, expressed in terms compatible with the credit value in the memory device for the future time period, is less than the lesser of the credit values in the memory device for each of the potential counterparties for the future time period and (ii) if the total financial exposure to each of the potential counterparties in the two or more future time periods is less than the lesser of the maximum credit values stored for each of the potential counterparties, and (b) otherwise not processing the proposed trade towards possible completion.
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28. A product comprising a computer usable medium or media storing computer readable code which when executed causes at least one computer to carry out a method of using credit data for trading over a network financial interests having a future financial exposure, the method comprising:
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for each of a plurality of future time periods with respect to a trading session, storing in a memory device a credit value for at least one counterparty designable by a trading party, each credit value being for use in connection with trading financial interests between the trading party and the at least one counterparty, the financial interests having a financial exposure to the trading party in the respective future time periods; and at or prior to a start of a trading session, storing the credit value for each time period and the at least one counterparty as a credit available value for use during the trading session; storing in the memory device a maximum credit value designable by the trading party for trading between the trading party and the at least one counterparty, wherein the maximum credit value is associated with financial exposure to the trading party in two or more of the plurality of future time periods; and during the trading session, (a) processing a proposed trade between the trading party and the at least one counterparty of a financial interest having a financial exposure in a future time period towards possible completion (i) if the financial exposure to the trading party of the financial instrument in the future time period, expressed in terms compatible with the available credit value in the memory device for the future time period, is less than the credit available value in the memory device for the future time period, and (ii) if the total financial exposure to the trading party in the two or more future time periods is less than the maximum credit value, and (b) otherwise not processing the proposed trade towards possible completion.
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Specification